Budgeting for Operations Coordination from Accounts Division Annual Operation Budget Plan Management Evaluation Review by GM & FC Overall Budget Report Approval by Hotel’s Owners

Budgeting for Operations Front office managers does this a long term planning The hotel’s annual operations budget is a profit plan that addresses all revenue sources and expense items Annual plans are divided into monthly plans, that in turn, are divided into weekly and sometimes into daily as well These budget plans become standards against which the management evaluates the actual result of operations

Budgeting for Operations In most hotels revenue and profit from room division is usually greater than other divisions Hence, accurate room division budget is vital to creating the hotel’s overall budget All management personnel must closely coordinate in the budget planning process Statistical information essential to the budget preparation process is the responsibility of accounting division

Budgeting for Operations Accounting division is also responsible for coordinating the budget plans of individual department managers into a comprehensive property-wide operations budget for top management’s review Then the GM and Controller review departmental budget plans and prepare an overall hotel budget report for approval by the hotel’s owners Incase of unsatisfactory budget, it is returned to the appropriate division managers for review and revision

Budgeting for Operations FOM ‘s primary responsibility in budgeting are: Room revenue forecast (input from reservation manager), Estimating related expenses (input from all department managers in the room division)

Estimating Expenses Typically rooms division expenses are: Payroll and related expenses Laundry, linen and terry and guest supplies Commissions and reservation expenses Other expenses