Pearson New International Edition International pcl tp indd 1

Discussion Questions:
1. What roles should the FOM and the hotel’s controller play in establishing poli-
cies and procedures applicable to front-office accounting?
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GUEST CHARGES, PAYMENT, AND CHECK-OUT
MANAGING GUEST CREDIT
The FOM serves an important role as a credit manager, because most guests pur-
chase the hotel’s goods and services on credit. Each hotel has policies about who may
establish a line of credit and how large each guest’s accounts receivable balance may
become before some payment is required. Roadmap 2 indicates that tactics to 
manage guest credit will now be discussed, and these tactics are important because
each affected front office staff member must be thoroughly familiar with the hotel’s
credit policies and procedures to enforce them equally and fairly for all guests.
At most hotels, payment cards are the most common method used to ensure pay-
ment. At check-in, the card is initiated and authorized for a predetermined amount;
the guest may then charge room rental and product and services purchases up to this
2. What are the main differences in bookkeeping procedures required to reduce
to zero a folio balance when it is paid by cash or payment card (credit or debit)
or when it is charged to a house account?
3. Can you think of examples of guest folio charges that might be transferred to a
hotel’s house account?