Pearson New International Edition International pcl tp indd 1

GUEST CHARGES, PAYMENT, AND CHECK-OUT
collection. The service provider charges the hotel a fee on all checks accepted (typ-
ically about 2 percent of the check amount) and agrees to pay for all returned
checks if the hotel has followed the service provider’s methods and procedures for
personal check acceptance.
Payment Card
The process used to settle folios and accounts of guests using payment cards was
described earlier in this chapter. From an accounting perspective, a guest’s use of a
payment card for account settlement results in a transfer of debt from the guest to the
card company. The amount owed to the hotel is moved from the guest ledger to an
accounts receivable section of the city ledger to bring the guest’s account balance to
zero. The card user (guest) promises to pay the card company, and the card company
promises to pay the hotel.
In most cases, this transfer of responsibility is routine. Difficulties can arise, how-
ever, when departing guests who had payment card funds blocked for payment at
check-out refuse to sign their final bill. Assume that Mr. Rios checked into the
Altoona Hotel for two nights. The front desk agent authorized his American Express
card for use as payment at check-out and, at check-in, Mr. Rios signed his registration
card. The next morning, however, Mr. Rios wants to check out because his room’s air
conditioner was too noisy. When he phoned the front desk at midnight to complain,
he says he was told there was no one available to fix the unit, but he could move to
another room. Mr. Rios did not want to change rooms at that late hour, and now he
does not want to stay because of the inadequate level of service. He refuses to sign his
bill stating that, because of the noisy unit, he could not rest and should not have to pay
for the room.
In this situation, and others involving guest complaints, it would be ideal if the
guest could be accommodated in a way that is fair to the guest and to the hotel. If
this is not possible, and the guest refuses to sign the folio statement, the guest’s
card can still be charged based on the signature secured at check-in. The guest must
then file a protest with the payment card company stating why the forced payment
was unjust.
Normally the payment card company will support the hotel in these disputes
if the hotel followed the payment card company’s established card-handling poli-
cies and procedures. Therefore, FOMs should be very familiar with the process-
ing procedures required by each payment card company with which the hotel does
business.
Direct Bill
Guest charges can be settled by transferring them from the guest ledger to a direct
bill account in the accounts receivable portion of the city ledger. This transfer
should be done only if the hotel’s accounting manager (i.e., controller) has preap-
proved an application for a direct bill account. Unlike a cash sale, a direct bill set-
tlement will not result in an immediate deposit of funds in a hotel’s bank. As shown
in Figure 13, a direct bill creates an accounts receivable that must be collected
before funds can be deposited. The responsibility to invoice and collect a direct
billing lies with the hotel’s credit manager. To complete a direct billing at check-
out, guests must sign their folios approving the posted charges. Only guests author-
ized to make charges to a direct bill account should be allowed to do, and their
names will be listed on the application for a direct bill account.
529

---