Pearson New International Edition International pcl tp indd 1

NIGHT AUDIT AND REPORT MANAGEMENT
Night auditors balance financial records such as guest ledgers and city ledgers.
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FRONT OFFICE SEMANTICS
Cashier’s drawer:
Cash, checks, payment card copies, and other financial records for which an employee
(cashier) is responsible.
Charles next records the cash received by the hotel during the day. Assume that
the amount of currency and checks totals $1,500. This amount is subtracted from net
revenue to yield the total resulting balance to be transferred to various accounts
receivable (e.g., specific credit and debit cards and direct bill accounts). Recall that
accounts receivable (A/R) represent the amounts owed to but not yet received by the
hotel. Figure 6 reviews the flow of revenue through the guest ledger balancing
process. The specific methods and procedures used to balance a hotel’s guest ledger
can vary. However, each night auditor must record, and each hotel’s FOM and con-
troller must monitor, the daily balancing of this ledger.
City Ledger
To balance the city ledger portion of the hotel’s accounts, Charles uses the formula
presented in Figure 7.
The city ledger is simply an A/R file maintained at the front desk. Charles checks
his records, which indicate that the A/R account balance from the prior day was
$70,000. To that he adds today’s A/R transfers of $6,790, which yields a total A/R
balance of $76,790. Next Charles subtracts $10,000: payments received by the hotel
today that must be applied to A/R balances. This includes receipts from payment
card companies, checks, and cash received that should be applied to direct bill
accounts receivable. Sometimes advance deposits or prepayments are received that
result in a credit balance for some accounts. In this example, the results of the com-
pleted account balance for the city ledger are shown in Figure 8.