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PROJECT CLAID (Contextualized and Localized Activities Intended for Distance Learning)
Name : ___________________________________ Date: ___________ Score:____

TECHNICAL-VOCATIONAL-LIVELIHOOD
FRONT OFFICE SERVICES - G12
Quarter 2 – Week - 1
Competency: TLE_HEFS9- 12CA-IIIa-b-15
Lesson: Front Office Services Accounting Cycle
Objectives:
1. Identify and resolve financial and system discrepancies according to
level of responsibility.
2. Implement financial systems and financial control systems in
accordance with establishment procedures.
3. Monitor systems and provide feedback.

CONCEPT
To independently conduct night audit.

ACTIVITY NO. 1
Getting Started
Directions: What is your idea on the modes of payment made by the guest in
the hotel? On a piece of paper, write 5 statements describing transactions
made on the two pictures shown below.

Picture A Picture B

DISCUSSION
FRONT OFFICE ACCOUNTING CYCLE
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ACCOUNTS
An account is a form in which financial data is accumulated and summarized.
It is a record of charges and payments. Adding a charge or payment to the
account is called posting to the account.

TWO TYPES OF ACCOUNT

Guest Account
A guest account in front office accounting system is to record of financial
transactions between a guest and the hotel.
Non-Guest Account
A hotel may extend in-house charge privileges to local businesses or agencies
as a means of promotion or to the groups sponsoring meetings at the hotels.

FOLIOS
Front office transactions are charted on account statements called folios. A
folio is a statement of all transactions (debits and credits) affecting the balance
of a single account.

FIVE TYPES OF FOLIO

Guest Folios Accounts assigned to individual guests or guestrooms.

Master Folios Accounts assigned to more than one guest or guestroom, usually
applicable for group accounts.
Non-Guest or Semi- Accounts assigned to non-guest business or agencies with hotel
Permanent Folios charge purchase privileges.
Employee Folios Accounts assigned to employees with charge purchase privileges.
Split Folios Accounts assigned to a guest on his/her request to split his/her
charges and payments between two personal folios – one to record
expenses to be paid by the sponsoring business company and the
other to record personal expenses to be paid by the guest. In this
case, two folios are created for the same guest.

VOUCHERS

A voucher details a transaction to be posted to a front office account. There

are several types of vouchers used in front office accounting system. These
are:

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Cash Voucher A voucher used to support a cash payment transaction at the front
desk.
Charge Voucher A voucher used to support a charge purchase transaction that takes
place somewhere other than the front office.
Allowance Voucher A voucher used to support an account allowance.
Cash Advance A voucher used to support cash flow out of the hotel, either directly
Voucher to or on behalf of the guest.
Correction Voucher A voucher used to support the correction of a posting error which is
rectified before the close of business on the day the error was made.
Credit Card A form designated by the credit card company to be used for
Voucher imprinting the credit card and recording the amount charged.
Paid-Out Voucher A voucher used to support the cash disbursed by the hotel on behalf
of a guest.
Transfer Voucher A voucher used to support a reduction in balance on one folio and an
equal increase in balance on another. It is used for transfers between
guest accounts and for transfers from guest accounts to non-guest
accounts when they are settled by credit cards.
Travel Agency In travel agent guaranteed reservation, the travel agent forwards a
Voucher voucher to the hotel as proof of payment and guarantees that the
prepaid amount will be sent to the hotel when the voucher is returned
to the travel agency for payment.

POINTS OF SALE (POS)

The term ‘point of sale’ denotes the location at which goods or services are
purchased. Any hotel department that collects revenue for its goods and
services is considered a point of sale.

LEDGERS
A ledger is a summary grouping of accounts. A front office ledger is a collection
of front office account folios. There are two types of ledgers in front office
accounting system:

Guest Ledger – It refers to the set of accounts related to the registered hotel
guests. It is also known as Transient ledger, Front Office ledger or Rooms
ledger.
City Ledger – Also called the non-guest ledger, it is the collection of non-guest
accounts. It can contain credit card payment accounts, direct billing accounts,
and accounts of past guests due for collection by the hotel.

ACCOUNTING SYSTEMS
Non-Automated. Guest folios in a manual system contain a series of columns
for listing debit and credit entries accumulated during occupancy

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Semi-Automated. Transactions are printed to a machine-posted folio.

Fully Automated. Computerized systems in which POS transactions are

automatically updated in the front office accounts.

CREDIT MONITORING
The front office accounting system must monitor guest and non-guest
accounts to ensure that they remain within acceptable credit limits. Guest
and non-guest accounts with other approved credit arrangements are subject
to limitations established by the front office called house limit.

FRONT OFFICE ACCOUNTING SYSTEM FORMULA

Transaction postings in the front office conform to a basic accounting formula:

Previous Balance + Debits – Credits = Net Outstanding Balances

INTERNAL CONTROL IN THE FRONT OFFICE

Internal control in the front office involves:
• Tracking transaction documentation
• Verifying account entries and balances
• Identifying vulnerabilities in the accounting system
• Auditing is a process of verifying front office accounting records for
accuracy. Certain records are maintained to have a control in front
office cash.

FRONT OFFICE CASH SHEET – The front office is responsible for a variety
of cash transactions affecting both guest and non-guest accounts. The front
office cashiers have to complete a front office cash sheet that lists each receipt
or disbursement of cash.

CASH BANK – A cash bank is the amount of cash assigned to a cashier so

that he/she can handle the various transactions that occur during a
particular work shift.

NET CASH RECEIPTS = Amount of Cash, Checks, Vouchers etc in

the Cashier’s Drawer – [Amount of Initial Cash Bank + Paid Outs]

OVERAGES – When the total of cash and checks in a cash drawer is greater
than the initial cash bank + net cash receipts.

SHORTAGES – When the total of cash and checks in a cash drawer is less
than the initial cash bank + net cash receipts.

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DUE BACK – A due back occurs when a cashier pays out more than he/she
receives i.e. there is not enough cash in the cash drawer to restore the initial
cash bank.

SETTLEMENT OF ACCOUNTS

The collection of payment for outstanding account balances is called account

settlement which involves bringing the account balance to zero.

ACTIVITY NO. 2

DIRECTIONS: Give what is being asked. Write your answer on the space
provided for.

___________1. A form on which financial data are accumulated and summarized. It is

a record of charges and payments.
___________2. It is used to support a cash payment transaction at the front desk.
___________3. It is called as the collection of payment for outstanding account
balances.
___________4. A voucher used to support a reduction in balance on one folio and an
equal increase in balance on another.
___________5.Guest folios in a manual system contain a series of columns for listing
debit and credit entries accumulated during occupancy.
___________6. It is also called the non-guest ledger and it is the collection of non-
guest accounts.
___________7. It is the result when the total of cash and checks in a cash drawer is
less than the initial cash bank + net cash receipts.
___________8. In this system, transactions are printed to a machine-posted folio.
___________9.It is a computerized systems in which POS transactions are
automatically updated in the front office accounts
___________10. The collection of payment for outstanding account balances.

DISCUSSION
Travelers are becoming increasingly reliant on their mobile devices, and they
love the convenience of paying for their goods and services online. It’s
important that hotel operators monitor the rising trends in the hotel payments
industry, because knowing how guests prefer to pay for their rooms is vital
for maximizing bookings at your property.

These are the top 5 trends in the hotel payments industry right now
1. Guests crave a seamless transaction
Rather than checking-out at the front desk and physically handing their
credit card to your staff member, your guests are starting to expect a
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seamless, ‘behind-the-scenes’ payment experience.

2. It is now common for payment processing to be integrated with the

property management system.

3. Guests are much more willing to give credit card information online
Consumers are increasingly willing and able to shop for nearly any product
or service online. They trust this medium and prefer the convenience online
shopping affords them.

4. Going paperless is now the norm, rather than the exception

Hotel guests not only prefer the convenience of electronic transaction
confirmations, they also see it as the more sustainable and responsible option.
5. Credit cards are the preferred method of payment, but use of e-wallet
is on the rise
E-wallets are considered to be more secure and more convenient than credit
cards. They are not the primary payment method of most travelers, but the
number of people relying on e-wallets is rising every year.

Benefits or advantages of online payments

Low labor costs. Since online payments are usually automatic, they
have lower labor costs than manual payment methods, such as
cheque, money order, cash and EFTPOS.

Convenience for online sales. Online payment methods allow

conveniently selling goods and services online.

Fast transaction speed. Online transactions quickly provide feedback

to you and your customers.

Low risk of theft. After processing delays, online payments generally

go straight into your bank account, so they have a low risk of theft.

Disadvantages of online payments

Service fees. Payment gateways and third-party payment processors

charge service fees.
Vulnerability to cybercriminals. Cybercriminals can disable online
payment methods or exploit them to steal people’s money or
information.

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Technical problems. Online payment methods can go down due to

technical problems.

Processing online payments

A customer visits your website and finds some products they want to buy.
The customer checks out the products from your website and goes to the
payments section.

Your website lets your customer know the total cost of the products they want
to buy as well as their payment options.

Tips for using online payment methods

Protect customer information. Only retain credit and debit card information
if you need it. Make sure you have good security to protect any information
you retain.

Shop around. Look for the best payment gateway provider or third party
payment processor for your business.

Use encryption. Make sure you use encryption for sending payment
information to and from your website to protect your customers’ information
from cybercriminals.

ACTIVITY NO.3
DIRECTIONS: Read the statements below regarding
disadvantages/advantages of online payments. Then, write T if the
statement is True and F if it is False.

_____1. Since online payments are usually automatic, they have lower labor
costs than manual payment methods, such as cheque, money order,
and cash.
_____2. Online payment methods allow convenience in selling goods and
services.
_____3. Online payments can be automatic which can be convenient for
both guest and hotel.
_____4. Online transactions quickly provide feedback to Hotel Management
and customers.
_____5. After processing delays, online payments generally go straight into
your bank account, so they have a low risk of theft.
_____6. Payment gateways and third-party payment processors charge
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service fees.
_____7. Online transactions are not vulnerable to cybercriminals.
_____8. A customer cannot visits website and finds some products/services
they want to buy.
_____9. The site lets customer know the total cost of the products they want
to buy as well as their payment options.
_____10. Online payment methods cannot go down due to technical
problems.

REFERENCES:
https://www.littlehotelier.com/r/revenue-
management/strategies/toptrends-hotel-payments-industry/

https://smallbusinessfirst.kochiesbusinessbuilders.com.au/advantagesand-
disadvantages-of-online-payments/

Prepared by:

EVELYN G. EMUTAN
Isaac Lopez Integrated School
SDO Mandaluyong

Editors:

LIBERTY P. MARQUEZ JULIE ANN S. ESPARAGOZA

Language and Layout Illustrator

Approved:

MARIFE V. ARIAS
Education Program Supervisor, TLE
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Q2 Week No.1 Competency Code: TLE_HEFS9- 12CA-IIIa-b-15 Competency:
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