21/02/2026
Hospitality Accounting Process 👇
1. Recording Financial Transactions
All business activities are recorded daily, such as:
Room sales (Front Office)
Restaurant & bar sales (F&B)
Banquet or event income
Laundry, spa, transport income
Purchase of goods/services
Salary & wages
Utility bills (electricity, water, gas)
Tools used: PMS (e.g., Opera PMS), POS system, and accounting software (e.g., Tally, SAP,IDS,plrofic). 2. Departmental Accounting
Hospitality businesses follow a departmental accounting system. Each department is treated as a cost/revenue center:
Rooms Division – Room revenue, laundry, telephone.
F&B Department – Restaurants, bar, banquets.
Other Income – Spa, transport, recreation.
Administration & General – Salaries, office expenses.
Maintenance/Engineering
Sales & Marketing
Each department’s revenue and expenses are tracked separately.
3. Daily Revenue Report (DRR)
Prepared by accounts daily (often called “Night Audit”):
Summarizes total revenue from rooms, F&B, etc.
Shows occupancy %, ADR (Average Daily Rate), and RevPAR (Revenue per Available Room).
Helps management monitor performance. 4. Cost Control & Inventory Management
Food & Beverage cost tracking.
Recipe costing, yield, and wastage reports.
Store requisitions and purchase control.
Physical stock verification vs. system stock. 5. Journal Entries and Ledger Posting
All daily transactions are posted in ledgers:
Cash & bank receipts/payments
Vendor invoices
Payroll entries
Adjustments (depreciation, accruals, etc.). 6. Financial Statements
At the end of each month and year:
Income Statement (P&L): Profit by department + overall profit.
Balance Sheet: Assets, liabilities, and equity.
Cash Flow Statement: Tracks liquidity and operational efficiency.
7. Taxation & Statutory Compliance
GST (Goods & Services Tax)
TDS (Tax Deducted at Source)
PF/ESI for employees
Income tax returns
License renewals (FSSAI, liquor license, etc.)
PT.
8. Internal Control & Auditing
Night audit verification
Cashier and petty cash checks
Vendor bill verification
Audit of inventory, F&B controls, room revenue
Coordination with internal & statutory auditors. 9. Key Performance Indicators (KPIs)
Management monitors:
Occupancy %
ADR (Average Daily Rate)
RevPAR
Food Cost % / Beverage Cost %
Gross Operating Profit (GOP)
