1. Chapter 12 The Night Audit

2. Learning Objectives
Develop an ability to recite without error the formulas associated with basic rooms statistics.
Discuss the importance of the housekeeper’s report to management of the front desk.
Understand the connection between the rooms management reports and the rooms forecasts.

3. The Auditor and the Audit (1 of 2)
Point-of-Sale System Interfaces
The nature of point-of-sale (POS) has changed drastically in the past few years
Where hand-written and physically carried vouchers were the norm in the 1980s, today’s hotel departments use mobile, contactless, and NFC payment hardware and software solutions
“Exception” alerts

4. The Auditor and the Audit (2 of 2)
The Night Auditor
Work Shift
Graveyard Shift: 11/12 midnight to 7/8 AM
Required to remain, until job is completed
Relieves the “Swing Shift” and is relieved by the “Day Shift”
General Duties
Night Audit plus all Night Manager Duties in smaller hotels
Security, FO, HK, Maintenance etc.,
Restricted to auditing duties only in larger hotels
FO staff and others handle night operations 4

5. Overview of the Audit (1 of 3)
Reconciling Accounts Receivable
All businesses need to reconcile accounts periodically
Hotels need to do it daily, as it may be too late otherwise!
The Closeout Hour
Hotels never close, so we have to pick a time to “close”
“Closing” means one days accounts are closed and the next days accounts begin
Most hotels chose midnight to “close”
Can be done later, if F & B outlets are open later
Later closing puts pressure on night auditors, but it accounts better for sales of outlets for the “day” 5

6. Overview of the Audit (2 of 3)
Posting Room Charges
Posting Room Charges Electronically
Room and tax for all rooms is posted at the press of one button instantaneously
Totals are updated automatically, and a summary made
No math or entry errors!
Room Charges Not Posted By the Auditor
Day rate, use rate, part day rate guests
Extra room charge for late check outs 6

7. Overview of the Audit (3 of 3)
Revenue Verification
Each folio (receivable) is updated nightly so an accurate bill can be presented on demand
Total income earned by any one department (say, room service) must equal the total of individual room-service charges posted to guest folios

8. Reconciling Using a Property Management System (1 of 5)
Interfacing Different Systems
Turnkey Systems
A standardized system installed by a vendor that the user simply “turns the key” to start
(as opposed to designing a system from scratch!)
Verifying Basic Data
Closing Routine
The press of one button does all steps of the manual night audit!
Need to tally department totals with FO totals only if POS systems are not interfaced with PMS system
Reports and print-out of folios generated automatically

9. Reconciling Using a Property Management System (2 of 5)
Zip-Out Check-out
Printed folio is put under guest room door late at night and amount is charged to credit card, guest comes to FO for check-out only if there is a problem
Similar procedure can be done with in-room TV
If guest needs a copy of bill, it can be mailed to them
PMS Posting Errors (Exhibit 12-6)
Errors still possible in PMS
Mostly entry errors of cashiers
System reduces errors by “rejecting” wrong entries
Can be systematic errors due to bugs in the system 9

10. Reconciling Using a Property Management System (3 of 5)
Reports form the Night Audit
Exception Reports
Highlights only exceptions from the norm
Lists only those over credit limit as opposed to credit status of each guest
Downtime Reports
Print outs of core information in case of system breakdown
Credit Reports
Credit status of “problem” guests
Reservation reports
Report of rooms sold, un-sold, sold-by, demanded, refused, walked, projected occupancy etc. 10

11. Reconciling Using a Property Management System (4 of 5)
Rooms Management Reports
List of guests, rates, convention member, VIP, etc.
Room Status Reports
List of occupied, vacant, OOO, OOI rooms, etc.
Accounts Receivable Reports
Lists details of City Ledger, Credit Card transactions, departmental totals etc.

12. Reconciling Using a Property Management System (5 of 5)
Report to the Manager
A report of the key issues of the previous day
Room Count, House Count, Room Income
These are reported daily and accounted for
Room Statistics
Rooms sold, ADR, Occupancy%, Comps, RevPar are reported daily
The Housekeeper’s Report