Finance and Funding in the Tourism Sector

This presentation discusses the importance of finance and funding in the tourism sector and its impact on decision making. It explores different types of management accounting information such as forecasting, budgeting, variance analysis, and ratio analysis. The presentation also assesses the use of management accounting information as a decision-making tool for Dalata Hotel Group plc. References are provided for further reading.

Finance and funding in the
tourism sector

INTRODUCTION
• Finance and funding play important role in in tourism and travel industry.
Importance of cost which proceeded into the decision making process.
• Business use finance information as all level of operation to understand the
effect of costing and help to management in effective decision making.
• In the brief of tourism and travel industry the mode of assessment,
assessment criteria after completion of the detail knowledge and the
importance of direct, indirect, fixed and variable cost.
• Analysing the pricing model which lead to organization in the competition
and get better return on the investment.

Different type of management
accounting information
1.Forecasting:-
 as of april13,2018 Dalata hotel group plc have consensus
forecast among 4 polled investment expert.
 Company will out form in the market. Company had revenue
for the year of 2017 of 348.47$ . revenue growth has been
recorded as 19.94% then the forecast model will use an annual
growth rate at 19.94%.
 Importance of forecasting is to predict the outcomes for the
future operations.

2.
2. Budgeting :-
 After the process of forecasting process Dalata hotel group plc have
forecasted and identified to build a model of the anticipated future revenue
growth.
 in budget process company allots the capital money for the future
operational activities. Company needs to examine the cost and liabilities
that are created in future.
 Company have certain design management for the budget: pre design
budgeting, design specification and management of tender process with
negotiating with suppliers. Review the selected tender and getting fixation
and equipment selection.

3. Variance analysis and cost accounting:-
 this analysis is process of comparing the actual standard with the
budget expenses. It is the quantitative analysis of actual and
planned behaviour.
 For instance Dalata hotel group plc have standard budget of
raising capital of 202.8$ but after the acquiring 15 hotels in
ireland and uk the company have achieved adjusted raising capital
of 62.6$(after cost).
 If in a company a positive variance occurs that means it can be
used into offset other negative variance and effort to modify the
present profit margin of the company.

4. Ratio analysis:-
this management accounting information can
be calculated for the company ability to pay
long term and short term debt.
This management information demonstrate a
company solvency and liquidity of the
company.
Ratio analysis can be used in optimum
utilization of resources and inventories.

P2.2 Assessing the management accounting information
as a decision-making tool for Dalata Hotel Group plc :-
management accounting information provides
significant data to leaders and top management
for the decision-making in future activities.
How to direct forward planning, projection
and monitoring the actual performance
comparing with the standard performance.
Management accounting tools provide
significant data that may lead to organisation
in competitive environment.

CONT…
Strategic decision:-
 after completing the raw structure of the future operation
management accounting information provide long term benefits
to the company.
 Dalata hotel group plc wants create better values to its
stakeholders and shareholders and this can be only achieved by
proper analysing of the accounting information.
 Cash flow and financial statements of the company actually
provides the actual position of the company.
 On the strategic front Dalata hotel group plc have commenced
four new hotels. This strategies also help in the extremely
positive development in long term lease.

Managerial decision:- this type of decisions are
related to the day by day working operational
activities of the company.
Ratio and variance analysis assist to working
capital requirement to daily operation of the
tourist and travel company.
Inventories management tools assist to better
management of the inventories so that effective
service can be providing to the customer’s.
 Management accounting information assists in
making of forecasting that find out variance and
formulate better decision.

Others:- management accounting information provides the
businesses to where the cost will be incurred and revenues
will come from.
• Make realistic raw structure of the future operational
activities that may leads to company in preparing for the
budget so gross profit and net profit can be find out for the
decision-maker.
• To optimum utilization of resources and inventories by in
daily operational activities.
• This type of tools also leads to organization in way of
merger, acquisition and reduce the probability of
duplication of work as tasks that are assigned to certain
department.

REFERENCES
Robinson, P. and et.al., 2016. Operations management
in the travel industry. CABI.
Roy, C., 2016. Financial Reporting Irregularities in
Indian Public Sector Units: An Analysis of Current
Practices. Browser Download This Paper.
Said, H. A., 2016. Using Different Probability
Distributions for Managerial Accounting Technique:
The Cost-Volume-Profit Analysis. Journal of
Business and Accounting. 9(1). p.3.