Financial Management and HR Life Cycle in Hospitality Business: A Case Study of Hilton Hotels

This report discusses the financial management and HR life cycle in the hospitality business, using Hilton Hotels as a case study. It covers topics such as financial transactions, principles of managing and monitoring financial performance, double entry bookkeeping, trial balance analysis, cost types and profit margin calculation. It also explores the different stages of the HR life cycle and their application to talent acquisition and retention in the food and beverage sector.

UNIT 4 THE HOSPITALITY
BUSINESS TOOLKIT

TABLE OF CONTENT
INTRODUCTION ..........................................................................................................................3
ACTIVITY 1- PART A...................................................................................................................3
Introducing financial transaction of Hilton by determining types of source documents.............3
Investigating principles of managing and monitoring financial performance of venture............3
Explaining the principles of double entry bookkeeping systems of debits & credits..................3
Analysis of trial balance using sales and purchase transactions, and steps of trial balance........3
Analysis of errors in trial balance and their rectifications...........................................................4
Types of cost and their influence on financial performance and profit margin calculation-.......4
Discussing the importance of accurate recording of transaction in line......................................5
Including conclusion that critically examine role of financial management and monitoring......5
ACTIVITY 1- PART B ..................................................................................................................6
Different stages of the HR life cycle as applied to issues in talent acquisition and retention
within the food and beverage sector............................................................................................6
Developing a performance management plan .............................................................................8
.....................................................................................................................................................8
Recommendations to improve HR life cycle ..............................................................................8
legislation(s) that hospitality organizations has to comply..........................................................9
Impact of company's employment and contract law on business decision-making ...................9
Examining potential implications of two regulations..................................................................9
Critically reflecting on impact of ethical issues of regulations..................................................10
ACTIVITY 2..................................................................................................................................10
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11

INTRODUCTION
In today's business environment, everyone needs to understand the concept of business-
not just their own part of it but how all the different aspects link together. The actions of a
hospitality manager can have a direct impact on other areas of business. The present report is
based on hospitality sector, Hilton hotels which is one of the largest hotel chain in the world
provides various types of services to attract customers. The current activity has two part, in part
A, the report is going to cover all the business transactions and accounting processes that the
organization goes through annually. In part B, the study will outline about human resources life-
cycle and potential impact of legal and ethical consideration on a hospitality business.
ACTIVITY 1- PART A
Introducing financial transaction of Hilton by determining types of source documents.
Financial transaction refers to the strategic agreement or contract as well as
communication between buyers and sellers. This kind of agreement may enable both parties to
exchange products and services or other assets for purpose of money.
Payments and receipts are the two types of financial transactions that Hilton may utilize
in appropriate manner. It may also take approach to use some specific source documents such as
checks, receipts, invoices, purchase orders and credit memos. By using each source of document,
management may keep evidence of financial transaction between venture and others such as
suppliers.
Accounts manager may follow the process of recording in which different types of stages
are included (Accounting Cycle, 2022). By referring to accounting cycle concept, some phases
are determined such as transaction, journal entries, posting, trail balance, worksheet, adjusting
entries, financial statements, and closing the books.
Investigating principles of managing and monitoring financial performance of venture.
Consistency-
According to the first principle of financial management, in the Hilton, management may
focus on transaction of money which they are accountable to handle in consistent way.
Timeliness-
The current principle may drive the attention of manager toward handling overall
financial transaction on time, by following the overall process and policy as it enable them to

grow Hilton rapidly (FIVE PRINCIPLES OF FINANCIAL TRANSACTIONS MANAGEMENT,
2020).
Justification-
They may take approach to clarify the reason behind small or large transaction that help
management to achieve aim of a task or project, adhere to strategic guidelines.
Documentation-
Management may assure that documentation is complete in appropriate manner before
and after financial transaction that may impact Hilton performance and success either in negative
or positive manner.
Certification-
It is important for them to make transaction approve and keep all the practice up to the
mark, with high authority approval and engagement.
Explaining the principles of double entry bookkeeping systems of debits & credits
The process of double entry bookkeeping system is quite simple and easy to comprehend.
As it is based on specific term such as every debit may have opposite and equal credit. Two
accounts are important to have that include any transaction.
It can be said that double entry is based on credit & debit accounts of money transaction,
that happen from national to international level (Sangster, 2022). Thus, it is essential for
management to comprehend above principle and also type of account, that might be real,
nominal and personal.
By following the above principle of double entry bookkeeping, they may manage
financial accounts and process of Hilton in appropriate way, which enable them to reach desire
outcomes as strategic decisions are made in systematic way.
Analysis of trial balance using sales and purchase transactions, and steps of trial balance.
For the year 2020.
Particulars Debit balance Credit balance
Total revenue by sales of services 4307
Sales of continuous operations 720
Purchase of operational services 620

Purchase of assets 1798
Other purchases of different hospitality items 2609
5027 5027
(Note- The data is taken as abstract.)
The steps taken for preparing trial balance-
1. Calculation of the balances of ledger accounts.
2. Recording debit and credit balances.
3. Calculating the total of Debit side.
4. Calculating total of the Credit side.
5. Checking the both sides of Trial balance (Bagdasaryan, 2019)
Purpose of Trial Balance-
It helps to check out the equality of the debit and credit sides of ledger.
It helps to uncover the errors which in the practise of journalizing or posting of entries.
Trial balance is very much helpful to prepare financial statements.
Analysis of errors in trial balance and their rectifications.
If any error is committed then a few steps or actions are taken in order to rectify those mistakes.
Example-1 If the amount of credit side is written in debit side.
Particulars Debit balance Credit balance
Total revenue by sales of services 4307
Sales of continuous operations 720
This is possible that such type of error takes place. In such circumstances the journal entry would
be passed-
Suspense a/c Dr. 720
To Sales of Continuous operations a/c 720
Example-2 If the amount is wrong. It is possible that due to recklessness the amount has been
written 720 and it might be 270. so again a journal entry would be passed.

So the difference amount of sales which was wrongly credited to the account would be rectified
with the journal entry-
Sales of continuous operations a/c Dr. 450
To Suspense a/c 450
Types of cost and their influence on financial performance and profit margin calculation-
There are multiple types of cost such as-
 Variable cost
 fixed cost
 semi-variable cost
 Historical cost
 Sink cost
 operational cost etc.
These costs are having their great influence on the organization and its financial performance.
 If the costs are now well managed then the organization would get thrive.
 There is need to install a strong cost accounting system in order to articulate them.
 The organization may align with costing standards in order to manage it with higher
standards.
 The costs must be aligning with their respective cost centre so better control can be
ensured.
So by abiding with these practises it can be managed.
Profit margin calculation- The profit margin can be calculated by applying the formula.
Profit margin ratio= Net income/ Net sales*100 (Senn, 2022)
For the year 2019 the Net income of Hilton hotels were= 9.451 billion USD.
The Net Profit was= 0.881 billion USD.
Profit margin= 0.881/9.451*100
=9.32%
With this regard, a well structured process has been followed where firstly the net income
of the organization was calculated. For fulfilment of the purpose the total cost was deducted form
the total revenue. Then the above stated formula was applied in order to calculate the profit
margin ration.

Discussing the importance of accurate recording of transaction in line.
Appropriate recording of transaction in line with accepted accounting principles is quite
essential for manager to do, because it may enable them to determine all the venture assets,
income, and other expense (Vogt, 2022). This process may drive their attention toward managing
everything according to plan and decision take to manage financial performance of hotel. It can
be said that good and appropriate record related to transaction may provide a lot of benefits to
company, for example, it may help to take right decision that management may implement into
practical manner, for purpose of purchasing goods or services. It may allow finance manager to
monitor the success and growth of venture that is also important for them to do that. The
consideration of each principle may allow them to obtain the current form of benefit, along with
others in the future.
Including conclusion that critically examine role of financial management and monitoring.
It can be critically evaluated that financial management and monitoring play important
role in the context of achieving progress in Hilton (Al Breiki and Nobanee, 2019). As it may plan
to pay taxes on a timely manner, so that it enable firm to become a good tax payer that help in its
growth in the overall industry, where success is important, but challenging too to achieve.
It recommended to management that they can also contribute to achieve progress of hotel,
in term of building a team of expert, who are able to manage and then monitor financial
performance of company (RESMI, PAHLEVI and SAYEKTI, 2021). It can aid management to
improve profitability of venture, in effective manner that also help to gain competitive benefit
and reach desire outcome that is important for them to do that in appropriate and systematic
manner.
ACTIVITY 1- PART B
Different stages of the HR life cycle as applied to issues in talent acquisition and retention within
the food and beverage sector.
As we all know that in today's business world, HR plays a vital role in the success of
business as they help company to find out and recruit talented staff for the different roles and
departments. Talking about human resources cycle which is famously called as the employee
journey, ensure the right people are in the right role (Kraneis, 2022). It has been said that there is
a high degree of overlap between the different stages of this life cycle of HR and the overall
strategy of HR. both of them together plays a large and important role in the overall experience

of employee. To be successful, the business organization in food and beverage sector needs to
manage both effectively. This helps company to increase productivity as well as employee
commitment towards business goals. Managed HR life cycle will help company to decrease in
staff turnover.
1. Recruitment, selection and attraction
This is the most important and fist stage of HR life-cycle. Attraction encompasses the
company's brand and what shapes a potential employee overall perception. Nowadays, word of
mouth plays a vital role in the success of business and helps to shape public opinion. The main
role of HR is to recruit and select talented people so that they can meet customer expectations.
Selecting the right people will help company to take employees promise and commitment
(Connery, 2022).
2. Induction, orientation, on-boarding
This is the second stage in which employees and employer layout their expectations of
each other. Human resource department ensure that new employee feels inspired and more
motivated by their new job role. It is the duty of company to feel welcomed and valued so that
they can easily achieve success and do their job in the right way. This stage should make sure
that companies should also make promise which they can actually deliver on. If they do fake
promises while induction and orientation time then employee become dissatisfied.
3. Career planning and development
after orientation and induction, employee should be provided with an opportunity for
them to grow so that they can easily achieve success. The HR professionals work effectively to
provide career planning details to every employee who are on-boarded. A key part of this stage is
how company's HR deal with performance management (Kraneis, 2022). It is essential to focus
on performance appraisal, company need to reward their employees in recognition of everything
they have achieved while working. The firm needs to focus on giving offer at individual level
and provide employee with team incentives for the new goals which is set. The company needs
to find out the ways to improve talent and skills of employees. Which helps them to boost
productivity and company's revenues.
4. Retention
As we all know that there is a lot of money and time invested in the employee cycle-
losing someone means that the entire process must start again and lots of work (Kraneis, 2022).

The HR professional needs to understand that they should use method to manage retention rate
and also able to retain talent. The best way to deal with this situation is to provide employee with
safe and healthy environment where they can work effectively and do their job role effectively.
When the company does not provide them a positive environment, employee become frustrated
and loses his temper.
5. Separation and termination phase
This is the last stage of HR life-cycle, it is very important for company to know about
why employees are leaving their job role and switching to another company. It is the duty of
company's HR professionals to have an open communication and conversation about their
choices and try to promote a positive work culture which helps to staff to leave the door open for
effective working (Marcon and Ribeiro, 2021).
HR plays a vital role in the success of business they support and grow talent in the
company (Rosett and Hagerty, 2021). The department of HR helps in employee retention, they
provide training sessions, internal promotion opportunities, providing them compensation and
benefits and also improve their workplace procedures and rules so that it can enhance the
workplace culture. The work effectively to improve the efforts related to recruitment. Especially
in hospitality sector, HR boost employee engagement by offering them flexibility while working
and offer them an effective communication tool that can enhance the culture of the firm. It is
advisable to take feedback from employees so that they can easily know about the areas of
improvement.
Developing a performance management plan
Areas of
improvement
Action to be taken Monitoring success
criteria
Review schedule
time
To improve workplace
culture with the help
of communication
skills
Creating healthy and
positive working
environment
Performance appraisal 1 month
To increase teamwork
by using collaboration
skills
Group work,
discussion and group
presentation
Key performance
metrics
2 month

Time management Avoid multitasking by
using time
management apps
Employee time
tracking
2.5 months
Conflict resolution Maintaining good
relationship using
open communication
as an effective tool
By measuring the
previous conflicts with
the present issues
1.5 months
Source : (How to implement a new performance management plan, 2022)
Recommendations to improve HR life cycle
It is recommended to improve recruitment process in the hospitality sector, by improving
a protocol for interviewing. By using methods like open communication, feedback, tests, active
listening and understanding the needs of employees. Giving the positive training and
development sessions to employees will be helpful. By managing communication channels will
help company to retain employees. The best way to improve life cycle of HR is to prioritize the
on-boarding process and always make efforts to make strong relationship with each employee.
Everyone in HR team of Hilton hotels should know that communication skills and
encouragement will be helpful to improve the HR life cycle stages (Schultz, 2021).
legislation(s) that hospitality organizations has to comply
Hospitality organisation must follow all the rules and regulation, policies, law and
legislation to run business smoothly. It is essential for them to follow legislation such as a license
under shops & establishments act so that they can run their business in a smooth manner. For eg:
They must also focus on following act like the health and safety at work act 1974 to protect
employee and customers from any hazards and dangerous situation. Hilton's hotels must take
notice of substances which may cause injury and illness to their staff. The main purpose of this
act is to promote and encourage high standards of health and safety at workplace so that they can
protect staffs and their working activities. In order to keep staff safe they must follow safety,
signs and signals regulations act 1996 so that they can know about fire exit and provide them
training on how to deal with any risky situation. Also, employment law must be taken into
consideration to maintain retention rate in the company.

Impact of company's employment and contract law on business decision-making
Employment law are those that protect rights of workers, encourage and promote safe,
healthy and positive work environments and prevent discrimination (Кudriavtsev, Kotova and
Arsentieva, 2021). The company should follow employment rights act 1996 in order to support
people in the company.
Examining potential implications of two regulations.
By implementing this law, companies can keep their workers and staff members satisfied
and encouraged towards their goals which helps them to make important decisions in the
company. This helps company to create mutual understanding between people and minimize
disputes between them. When the balance of employers and employees are equally maintained
then it helps to make decision-making process successful. Whereas, contract law is a promise
enforceable by law which helps company to make contract requires the mutual assent of 2 or
more parties. Contract law explain about the expectations of parties and protect both of them, for
eg: if these expectations are not met in an effective manner then it can impact the decision-
making process vice versa (Ulen, 2021). It helps company to maintain business relationship and
protect organizational activities. Hence, both the laws are very important in the smooth running
of business.
Critically reflecting on impact of ethical issues of regulations.
Ethical issues include discrimination and harassment, health and safety and toxic
workplace culture. If company wants to maintain its workplace culture and provide employee
safe and positive environment them they must follow legislation such as health and safety at
work act, equality act, employment law. A good employment and labour laws, contract can
accurately ensure fairness at work, attract people to work for firm and support company to boost
productivity (Bernstein, 2022).
ACTIVITY 2
Covered in PPT
CONCLUSION
From above study, it has been concluded that with appropriate financial transaction,
management has managed the financial performance of hotel, that is important and beneficial for
venture success. They had followed the key principles of managing as well as monitoring
financial performance that helped to gain competitive advantages in bulk. Firm has achieved its

strategic goals and objectives, by considering the trial balance and other financial terms.
Furthermore, by summing up above analysis, it has been summarized that hotel has improved its
performance and increased profitability by conducting practice of financial management and
monitoring. Human resource management has contributed to maximize organizational
performance, by hiring right people on the bases of their qualification, skills, competencies and
effectiveness. Moreover, it has been determined that by applying appropriate recruitment and
selection stages, management has build up wider and stronger workforce. The strategic
considerations have enabled company to grow productively in the hospitality sector.

REFERENCES
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be aware of. Available at SSRN.
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