Improving HR Life Cycle and Financial Management

The provided assignment details a study on financial and human resource management in the growth of the hospitality industry. It highlights the significance of financial reports and statements in managing resources and measuring performance. Human resource management is also crucial for proper hotel functioning, as it enables customer satisfaction through employee relations and performance evaluation. The study emphasizes the importance of legislation and laws in boosting profitability and communication in the service sector's success.

The Hospitality Business
Toolkit

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
Introduction Of Financial Transactions, Identifying The Types Of Source Documents And
Recording Processes...............................................................................................................1
Principles Of Double Entry Bookkeeping System Of Debits And Credits ...........................2
Needs Of An Accounting Report And Trial Balance.............................................................3
Types Of Costs, Its Influence The Financial Performance And Importance Of Accurate
Recording Of Transactions.....................................................................................................4
Evaluation Of Role Of Financial Management & Financial Monitoring And Recommendation
................................................................................................................................................4
TASK 2............................................................................................................................................5
Overview Of HR Issues Regarding Talents Acquisition And Retention...............................5
Factors Affecting General Manager Job.................................................................................5
Legislation affects the business of the hospitality industry....................................................5
Life cycle of HR and their importance...................................................................................6
Performance Management Plan For The Role of Hotel Manager..........................................7
Recommendations To Improve The Hr Life Cycle................................................................8
TASK 3............................................................................................................................................8
CONCLUSION................................................................................................................................8
REFERENCES..............................................................................................................................10

INTRODUCTION
Hospitality refers to the relationship between guests and host. Hospitality is an industry
which comes under the Service Sector. This industry provides lodging, food and drink service,
event planning, theme parks and travelling service. In this industry, hospitality units are hotels,
motels, flotels, resorts, restaurants, bars, cafes, night clubs, tea shops and wine shops (Lopes,
2016). Hospitality management refers to the management of hotel staffs, management of
business, management of marketing, management of revenue and financial accounting. It also
includes the maintenance of standards of hotel facilities and guest satisfaction. This Report will
highlight the financial aspects and human resource management of hospitality. Report will also
describe the legislations and laws follow by hospitality industry. Report will tell about the
communication system used by hospitality industry.
TASK 1
Financial transactions, identifying the types of source documents and recording processes
FINANCIAL TRANSACTIONS – It is an event which happens between Buyers (guests) and
Sellers(hosts) for the exchange of services against some monetary value. There are 4 types of
Financial Transactions -
11 Sale is a financial transaction in which services is transferred from buyer to seller in
exchange of monetary value.11 Purchase is a financial transaction in which services is transferred from seller to buyer in
exchange of monetary value.11 Receipt is a financial transaction in which hotel is getting paid for delivering goods and
services to another business.11 Payment is a financial transaction in which hotel is paying to another business for getting
goods and services (Kimmel and et.al., 2016).
TYPES OF SOURCE DOCUMENTS -
11 Invoice is a document which is issued by hosts to the guests for the services used by
guests. It is given before the payment.11 Receipt is a written acknowledgement that services are providing. It is given only when
final payment is done. It is written by hosts and give it to the guests of the hotel who will
use hotel services.
1

11 Cheque is a document that order the bank to pay specific amount from the guest's
account to the host in whose name the cheque has been issued (Top 8 Types of
Documents Used in Accounting, 2014).
RECORDING PROCESS – Hotel uses journal entry for the recording of financial transactions.
Journal entry is the first step used in financial accounting system, where all the transactions are
recorded as debits and credits (Narayanaswamy, 2017).
Principles of double entry bookkeeping system of debits and credits
Debits and Credits are entries made in double entry bookkeeping in which debit means
increasing in asset or expense account and decreasing in liability or equity account. While, credit
means decreasing in asset or expense account and increasing in liability or equity account.
To determine that which account is debit and which account is credit. There is an
approach which is based on three principles which is also known as ACCOUNTING GOLDEN
RULES. These 3 principles are as follows -
1. Debit whatever comes in and, credit whatever goes out – This rule is applicable to
Real accounts which includes the assets of the hotel.
2. Receiver's account is debited, and giver's account is credited – This rule is applicable
to Personal accounts which includes the managers, employers, employees, hotels, banks
and all the customers.
3. All expenses and losses are debited and, all incomes and gains are credited – This
rule is applicable to Nominal accounts which includes income, expenditures, losses and
gains (Bookkeeping, 2004-2019).
EXAMPLE -
Tom Ltd. sold a product to Oliver Ltd. for £100 in cash.
TRANSACTION DEBIT CREDIT
Cash A/C Dr. £100.00
To Sale A/C £100.00
Needs of an accounting report and trial balance
Needs of accounting reports are mentioned below -
1. It helps hotel to maintain records of transactions.
2

2. It helps in providing accounting information to the management for the purpose of their
further financial planning for the hotel.
TRIAL BALANCE, IT'S PURPOSE AND STEPS USED IN TRIAL BALANCE
Trial Balance is a statement that shows the total of debits and credits of all the
transactions recorded in ledger accounts.
The purpose behind the making of trial balance is to verify the arithmetical accuracy of
posting into ledger accounts and finding errors. Also, it helps in preparing financial statements
like profits and loss accounts, balance sheets etc.
Following steps are taken in order to prepare Trial Balance -
Calculate the balances of each account in the Ledger.
List down each account and place its balance in the column of debit and credit.
Compute the total balance of debit column and credit column both.
Verify the total of debit is equal to total of credit. If total of both the side (Debit side and Credit
side) are not match then there is a chance of error in either in recording the transactions or
posting the entries into ledger.
SAMPLE OF TRIAL BALANCE -
3

Types of costs, its influence the financial performance and importance of accurate recording of
transactions
TYPES OF COST AND ITS IMPACT ON FINANCIAL PERFORMANCE
There are mainly 2 types of costs -
1. Fixed Cost – Fixed cost is the cost, which does not change with the number of producing
services by the hotel.
2. Variable Cost – Variable cost is the cost, which change with the number of producing
services by the hotel. If number of services produced is increased, this would lead to
increase in variable cost. But if number of services produced is decreased, this would lead
to decrease in variable cost.
FIXED COST + VARIABLE COST = TOTAL COST
Financial performance can be measured by gross profit which is influenced by the fixed
and variable costs. Gross profit is calculated by “Total Revenue – Total Cost”.
Fixed Cost always remains same. Change in variable cost impact the total cost. If variable
cost increases, total cost will also increase. But if variable cost decreases, total cost will decrease.
If total cost increases and revenue is same, which means gross profit is low which show the weak
financial performance. If total cost decreases and revenue is same, it means gross profit is high
which show the strong financial performance.
IMPORTANCE OF ACCURATE RECORDING OF TRANSACTIONS
1. It helps hotel to know about the payment of tax and tax return.
2. It helps hotel to track the expenses and profits.
3. It helps hotel to fulfil the legal requirements.
4. It helps hotel to prevent from fraud and theft etc.
Evaluation of role of financial management & financial monitoring and recommendation
EVALUATION -
Financial management helps company in financial planning which helps company to use
its financial resource and funds carefully. This lead to increase in profitability and overall value
of the firm. It also provides economic stability and growth of the company.
Financial monitoring helps company to manage the cost and risks involved in business
activities. It boosts financial manger confidence regarding financial decisions. It allows business
4

to compete its competitors. These all in turn leads to a healthier business and faster growth rate
of business (Warren and Jones, 2018).
RECOMMENDATION -
Company can boosts its financial position and improves its financial performance by
using various financial management tools and financial monitoring tools. By using tools,
company can uses its financial resources and funds qualitatively which improves the company's
activities and reduces the cost. This lead to increase in profitability of company. This will boost
the company competitive advantages.
TASK 2
Overview of HR issues regarding talents acquisition and retention
ISSUES IN TALENT ACQUISITION
Today, in Talent acquisition process, HR managers face of Hilton the biggest issue of not
finding suitable candidates for the job. When they find the suitable candidates, they either don’t
have experience or their performance is poor.
ISSUES IN RETENTION
All employees expect high salary and promotion in the future, but if they don't get the
promotion or increment in salary, they quit the job. Also, when employees get lucrative offers
from better companies, it makes employees to quit the present job which increase employee
turnover.
Factors Affecting General Manager Job
Following factors are mentioned below which affect the job of General Manager -
1. Conflicts between employees affect the co-ordination activity of general manager.
2. Change in environmental factors affects the implementation of strategies by general
manager.
3. Poor performance of hotel also affects the general manager.
4. Future is uncertain and general manager have to update and predict the future situation
that may occur and affect the business. This will also affect the general manager.
5. General manger is responsible for the investment. If in case the investment goes into loss,
this will also affect him (Fayol, 2016).
Legislation affects the business of the hospitality industry
Employments act 1996
5

This act provides the rights to get minimum wages, employment contracts according to
the law. The equal opportunity of employment is provided to the each candidate who is appeared
for the interview. This act improved the recruitment process of the Hilton hotel.
Health and safety act 1974
According to this act the health and safety of the employees is the responsibility of the
employer. This act changes the health and safety regulation of the industry. According to this
acts Hilton hotel have to provide all the tools and technologies which helps employees to prevent
from any physical and mental harms.
Working time act 1998
This act guides the hotel management to set the minimum working hours for individual
employee. According to this law for a week minimum number of the work hour are fixed. This
act ensures that the employees are paid enough according to their work hours. For the pregnant
women this act ensures the maternity leaves with paid salary. For the employees Hilton hotel
provides the care for the education of their children.
Equality Act 2010
According to this act, there should be no discrimination between employees on the basis
of following characteristic-
1. sex
2. gender
3. marriage
4. castes, values and beliefs
5. regions
6. Opportunities (Khan, 2017).
Life cycle of HR and their importance
In the staffing process, for the post of hotel manager in the hotel Hilton the HR follows
cycle of seven different steps.
Recruitment- HR department recruit new staff to fill the current openings of manager. For the
recruitment the HR attracts the skilled and experienced persons and arrange the interview.
Through the interview process the candidates are shortlisted and selected for the particular role
of manager.
6

ON-Boarding- HR of hotel Hilton informs the candidate about the terms and conditions of the
hotel Hilton. Also, gives the information of the policies run by the hotel for well fare of the
employees.
Training- HR conducts the required training for the new recruits, related to their job profile to
enhance their skills.
Attendance- the HR department keeps the information of the employee's attendance to manage
the salary arrangement.
Payroll run- HR department manage the payrolls of the employee as per their performance and
take care of the minimum wages, deductions and keep the record of the payment data of the
employees (Wright, 2018).
Appraise- The HR department play an important role in designing and implementation of the
performance appraise of the employees to motivate them for better performance.
Exit- When the employee leaves the company, the HRM conducts the exit interview to take the
feedback for the company to improve the weak points in the employee management.
Importance of the HRM
HR department plays the important roll to support the hotel manager for better
performance. HR conducts different training to enhance the skills of the manager to increase the
situation handling capacity. To retain the employee the HR department provides different
incentives and appraisals.
Performance Management Plan For The Role of Hotel Manager
To improve the performance of the hotel manager hr department conducts the
performance management plan.
Duties & Improvement
Required
Action and Support
provided
Expected Outcomes?
Measurement
Time required
Communication The communication is
conducted to improve
the listing and
speaking skills of the
manager.
Communication is
improved
Two months
Employee The previous The employee Two days
7

management technologies used for
the employee
management are
replaced with the latest
technology.
management improved
Situation handling The required training
is conducted for better
situation handling.
Situation handling
improved
One and half month
(Cascio, 2015)
Recommendations to Improve the HR Life Cycle
To improve the HR life cycle several changes need to apply. The HR cycle is consists of
seven process and by improving them, overall performance of the HR cycle will improve. In the
recruitment process by improving the selection and shortlisting process, better candidate can be
hired and this will improve the client handling capacity of the hotel. By keeping the documents
related to the employee in well-arranged manner will improve the evaluation method of the
employee and help the HR department to conduct the training and help the HR to make the
proper deductions. The improved payroll management and documentation of the employee
performance helps the HRM to provide the required appraisals. If HRM is keeping the
information about the employee relations and performance, it will be helpful to take decisions
related to retaining of the employees.
TASK 3
Covered in the PPT
CONCLUSION
From the above study, it has been summarized that Financial and Human resource
management play an important role in the growth of hospitality industry. With financial reports
and statements, it cannot be possible to manage the financial resources and measure the financial
performance of the industry. Without human resource management, hospitality units can not be
manage properly. Customer satisfaction is the most important factor for this industry which can
be only measure when there will be any human touch. Legislation and laws play a crucial role in
the legal framework of the industry. It helps the companies to boosts its profitability In the realm.
8

Following these legislations and laws are beneficial for the companies as well as for the service
users. Communication also plays an important part in the growth of service sector. Without
communication, no hospitality and service sector won't survive and Hilton hotel as well. Thus,
managers have to take care of communication system of the hotel.
9

REFERENCES
Books and Journals
Cascio, W.F., 2015. Managing human resources. McGraw-Hill.
Fayol, H., 2016. General and industrial management. Ravenio Books.
Khan, S.A., 2017. Unit 3 State Legislations/Rules And Procedures. IGNOU.
Kimmel, P.D., and et.al., 2016. Financial Accounting. Wiley Custom Learning Solutions.
Lopes, M., 2016. The hospitality industry (Doctoral dissertation).
Narayanaswamy, R., 2017. Financial accounting: a managerial perspective. PHI Learning Pvt.
Ltd..
Warren, C. and Jones, J., 2018. Corporate financial accounting. Cengage Learning.
Wright, P., 2018. Fundamentals of human resource management. Management. 5. p.27.
Online
Bookkeeping. 2004-2019. [ONLINE]. Available through :
<https://www.accountingcoach.com/bookkeeping/explanation/3>
Top 8 Types of Documents Used in Accounting. 2014. [ONLINE]. Available through :
<http://www.yourarticlelibrary.com/accounting/documents/top-8-types-of-documents-
used-in-accounting/63112>
10