Financial Management for the Hotel Industry

Financial Management
for the Hotel Industry

Contents
Contents...........................................................................................................................................2
INTRODUCTION...........................................................................................................................1
MAIN BODY..................................................................................................................................1
Evaluation of fiscal efficiency.....................................................................................................1
The importance of comprehending ratios and their variations for hospitality administration is
discussed......................................................................................................................................4
Addressing the advantages and drawbacks of accounting ratios as a decision-making tool.......5
CONCLUSION................................................................................................................................6
REFERENCES................................................................................................................................8

INTRODUCTION
Stakeholders are far more convinced by monetary statements. The statements will be
analysed in a range of methods, including accounting ratios, peer-to-peer assessment, year-over-
year evaluation, and inter-departmental interpretation, among others (Firouzjah, 2018).
Proportion assessment is the most common methodological approach. As a Jurys Inn auditor, I
have received charged with providing information for the administration in order to conduct
these accounting ratios. Jurys Inn is a hospitality firm operating in the Great Britain and Northern
England. The firm's current operations have actually taken a sour turn. As a result, the analysis
includes the fiscal success of it and that too in an effective and efficient manner.
MAIN BODY
Evaluation of fiscal efficiency
Monetary effectiveness assessment can be performed in a variety of methods. Proportion
assessment is a fiscal account analytical technique that takes into account various comparisons
for various monetary data. The metrics are the proportional connections between diverse
accounting elements, in which every proportion is calculated as a fraction of the others. Liquidity
position, viability position, engagement proportions, gearing metrics, and leverage percentage
are the five categories of these metrics. Accessibility metrics are a measure of a company's
capacity to repay relatively brief liabilities. Solvency metrics are a measure of a company's
capacity to discharge protracted liabilities (Higgins and Cornwell, 2016). Productivity
percentages are a measure of how efficiently a business uses its operational resources. Gearing
metrics are financial leveraging statistics that reveal the proportion of leveraged in a statement of
financial position as well as its capacity to service debt. Productivity metrics are revenue
representation percentages for various monetary elements like selling, assets, and capital, among
others.
Computing appropriate ratios, debating observed patterns, and deriving conclusions from
analytics of the Jurys Inn
Profitability Ratios 2019 2020 Trend
Gross profit margin 93% 86% -7%
Net profit margin 70% 60% -10%
Return on capital employed 59% 57% -2%