Chapter 5Chapter 5

III. The Night AuditIII. The Night Audit

Night AuditNight Audit

A daily comparison of

Guest and Non-guest

Accounts with

Revenue Center Transactions

Functions Of The Night Functions Of The Night AuditAudit

1. Verify posted account entries

2. Balance all front office accounts

3. Resolve room status

discrepancies

4. Monitor guest credit restrictions

5. Produce reports

Night AuditNight Audit

The night audit focuses on two areas:

1. The discovery and correction of front office accounting Errors

2. The creation of accounting and management Reports

Night AuditNight AuditAudit Work Time

Time from beginning to end of night audit. “End of Day” is when the audit begins. Transactions received during this time are held and posted once the audit

is completed.

Audit Trail Flow of source documents which details each step in the processing of a

transaction. Use cash register tapes as a cross-reference.

Night AuditNight Audit

Bucket Check Cross check folios with housekeeping report and room

rack.

Make sure all occupied rooms are charged.

Audit is complete when: Totals for all guest, non-guest and departmental

accounts are in balance.

If it is out of balance, you have to find it!!

Night Audit ProcessNight Audit Process

1. Complete Outstanding Postings First step in the night audit process

Post all transactions before “End of Day”

2. Reconcile Room Status Discrepancies Perform a Bucket Check

Errors can lead to lost revenue

Not a problem in fully-automated hotels

Night Audit ProcessNight Audit Process3. Balance All Departments

Trial Balance - Balance front office accounts with departmental transactions.

4. Verify Room Rates & No-ShowsRoom Revenue & Count ReportCompares rack rate to actual rate

No-showsCheck Duplicates and Misspellings

Night Audit ProcessNight Audit Process

5. Post Room & Tax

Semi-automated system Post room & tax separately for every room

6. Prepare & Distribute Reports Distribution of reports is the final step in the night

audit process.

7. Clear or Back-Up the System– Clear = Semi-automated system– Back-Up = Fully-automated system

Night Audit ReportsNight Audit Reports

Department Detail & Summary Report Verifies that all transactions were properly posted

High Balance Report Identifies guest and non-guest accounts that are

approaching the hotel’s credit limit.

Daily Operations Report The most important outcome of the night audit. Summarizes the day’s business and provides hotel

operating statistics.

Mui Ne Hotel StatisticsMui Ne Hotel Statistics Hotels Rooms Occ ADR

Allezboo 1,922 88.1% $67.03

Novotel 3,813 78.3% $85.97

Sealion 5,146 70.5% $88.99

Victoria 1,860 67.2% $78.74

L’anmien 2,759 70.9% $107.16

Common Errors Corrected Common Errors Corrected

During The Night AuditDuring The Night Audit

Balance Pickup Errors Incorrectly enter the folio’s previous balance Does not happen with fully automated systems

Transposition Errors Transaction numbers are reversed Post $25 instead of $52 Subtract numbers and divide by 9 52 - 25 = 27 27/ 9 = 3 (Whole number)