Managing Finance and HR in Hospitality Business

This report provides insights into managing finance and human resources in the hospitality industry. It covers topics such as financial transactions, principles of double entry bookkeeping, cost management, HR life cycle, and the impact of legal and ethical considerations.

Hospitality Business
Toolkit

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
PART A...........................................................................................................................................1
Introduction to financial transaction of hospitality business.......................................................1
Investigate principles of managing and monitoring performance of finance.............................2
Describe principles of double entry bookkeeping system of debits and credits ........................4
Basic trial balance.......................................................................................................................4
Analyse types of cost and how company can be managed to influence performance of finance.
.....................................................................................................................................................5
Importance of actual recording of transactions...........................................................................5
Conclusion...................................................................................................................................5
PART B............................................................................................................................................6
Review of various steps of HR cycle..........................................................................................6
Evaluate every step of HR cycle and its importance...................................................................7
Develop a management of performance plan to support particular job role...............................7
Judgements and recommendations..............................................................................................8
Identify particular legislation......................................................................................................8
How organisation's employment and contract law affect on business decision making.............8
Analyse potential implications of any two of regulations...........................................................9
Critically reflects on impact of ethical problems of regulations, legislations and principles.....9
Exploration of various functional roles within the The Berkeley...............................................9
Describe various communication methods and levels used in company..................................10
Analyse effectiveness of various communication methods, integration and monitoring within
particular department................................................................................................................10

Valid judgements and recommendations..................................................................................10
CONCLUSION .............................................................................................................................11
REFERENCES..............................................................................................................................12

INTRODUCTION
Hospitality industry is part of services industry and it comprised three major sub sector
which include food and beverages, events, tourism and transportation. This industry is concern
itself provide the best quality of products and services to its customers and provide them high
level of satisfaction from those product and services. Hotel has huge loyal customer base provide
them luxury products and services (Korstanje, 2020). This report is based on The Berkeley hotel,
Berkeley is five star hotel in London, hotel has been trending its own path for more than 100
years. With stunning rooms and the brightest minds in the design world. This report include
information about how to manage finance and record transaction to minimise cost responsibility
within the hospitality sector, also evaluation of how to manage human resource life cycle within
the hospitality industry. Furthermore, it include various impact of legal and ethical consideration
on hospitality industry.
MAIN BODY
PART A
Introduction to financial transaction of hospitality business.
Financial transactions refer to the recording of all financial transactions, summarising
them, and appropriately reporting them. This transaction has all the record of inflow and outflow
of the funds within the organization(Murillo, and King, 2019). In hospitality industry a fine
collection of month end account is prepared in order to have insight about expenses and
profitability of the organization. In the context of The Berkeley, hotel prepare and maintain
monthly transaction records for the future safety. They maintain budget statement, business
planning, creating financial statements and balance sheet and payroll. Accounting is highly
significant in hospitality business of The Berkeley, this helps the business of hotel to have insight
about the financial position of the company.
Principles of managing and monitoring financial performance:
Managing and monitoring financial performance of the organization helps business in
making both long and short term decision making in order to gain better profitability and growth
of the company. Management of financial performance of the business helps in effective decision
making and gain competitive edges in the industry. In the context of The Berkeley below are
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various principles that company can use in order to management and monitor its financial
performance.
Consistency: In the context of The Berkeley, hotel ensure that all the transactions within
the organization must be handle on consistence manner(Tasci, 2019). This helps them to analyse
their day to day financial performance and enhancement in the financial transactions of the
organization. Hotel also established policies and procedures that followed by the accounting
managers of the hotel in order to maintain all the types of transactions in routine manner.
Timeliness: In the terms of The Berkeley, accounting managers of the hotel ensure that
they handle all the transaction within an fixed period of time. Managers ensures that they analyse
all the transactions on consistency and appropriate time in order to provide effective financial
results to the hotel.
Justification: Management of The Berkeley, ensure that all the transaction within in
organization must be done in order to support the goals and objectives of the company. There
should be appropriate reason for the transaction that is done under the record of financial
statement of the company.
Documentation: All the transactions in The Berkeley, has support documentation that
helps higher authorities to understand about the funds and inflow and outflow of funds in the
company.
Certification: All the transactions in The Berkeley, has approved from higher
authorities of the hotels and carry out authorized signatures.
Investigate principles of managing and monitoring performance of finance.
Profit and loss statements:
It is a financial statement that summarizes the revenues, cost and expenses incurred
during specific period of time(Higgins-Desbiolles, Moskwa,and Wijesinghe, 2019). Profit and
loss statement helps business to have insight about ability and inability of business. In the
context of The Berkeley profit and loss statement of the hotel explain all the expenses and
revenue of the business during the financial year of the company. This is double entry
bookkeeping system that have all the records of debit and credit of the business. Below is
showing the profit and loss statement of the hotel.
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Profit and loss statement of The Berkeley:
Profit and loss statement of The Berkeley for March 2020
Particulars Amount Particulars Amount
To Opening
Inventory 17000 By Sales
14500
0
To Purchase
63
00
0 Less : Return Inward -3200 141800
Less : Return
Outward
-
18
00 61200 By Closing Inventory 21000
To Gross
Profit 84600
Total 162800 Total 162800
To
Administrati
on Cost 33000 By Gross Profit 84600
TO
Distribution
Cost 30500
To
Depreciation 9000
To Finance
Cost 1600
To Tax 2100
To Net Profit 8400
Total 84600 Total 84600
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Describe principles of double entry bookkeeping system of debits and credits .
It is very essential for the business to have effective record of all the debit and credit
transaction of the organization. In the context of The Berkeley, hotel has all the records of
transaction occurring within an organization. This helps organization have actual insight about
the financial position of the hotel in the market.
Basic trial balance.
It is a bookkeeping worksheet that have information about the all balance of ledgers and
complied it into debit and credit accounts column totals that are equal. Business prepare tail
usually at the end of financial year (Deszca, Ingols, and Cawsey, 2019). The purpose of
preparing trail balance is to ensure the entries in the company' bookkeeping system. In the
context of The Berkeley, the accounting managers of the hotel ensure that they prepare trail
balance at the end of financial year so that it can summarise all the transaction in appropriate
manner.
Trail balance of The Berkeley:
Trial Balance for The Berkeley
Particulars Debit Credit
Storage Cost 500
Purchase 10500
Sales 14600
Motor
Expenses 530
Cash at Bank 54000
Cash in Hand 18700
Payables 29100
Premises 250000
Van 52250
Fixtures 8350
Inventory 23200
Receivables 15420
Sales Return 900
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Purchase
Return 70
Salaries 5000
Business Rates 1480
Capital 397060
Total 440830 440830
Analyse types of cost and how company can be managed to influence performance of finance.
Fixed cost: This cost is an expense for the business do not change with the change in
productivity and sale of the business(Stankova, and Pashova, 2020). Fixed cost stay in the place
as long the size of operation is same. It is an pre-determined expenses of company that are paid
on monthly basis. In the context of The Berkeley hotel pay various fixed expenses in the
business that helps to make their business operational. Fixed cost of the hotel associated with
fixed period of time.
Variable cost: This cost of the business fluctuate with the time and production of the
company. It is proportion to the production output, variable cost increase and decrease depending
on production volume of the business. In the context of The Berkeley, hotel variable cost is a
corporate expense that change with production output.
Importance of actual recording of transactions.
It is essential for the business to have appropriate record of all the transactions that helps
business to have insight about the financial position of the company. Recording of all the
transaction increase the effectiveness of business and provide business and proper statement of
profit and loss. The actual specific business form of all the statements assist business towards
appropriate decision making of organization. Bookkeeping system in The Berkeley, helps hotel
to have all the record transactions and profitability of the organization in financial year.
Conclusion.
From the above information it can be conclude that financial transaction in hospitality
have all records of financial transaction and it assist hotel towards the better insight about the
profit or loss of the company. Principles of managing and monitoring financial performance of
hotel helps to handle all the transactions on time and in appropriate manner. Effective records of
all the transactions increase the level of effectiveness in business.
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PART B
Review of various steps of HR cycle.
Human resource department of the company effective manage at workplace and focus on
effective performance of employees and productivity (Jasnoff, and Sheikh, 2019). Human
resource life cycle define the employee's time within in organization. In the context of The
Berkeley, human resource managers of hotel ensure that they follow HR life cycle in most
effective manner that increase the level of effectiveness in productivity. They focus on attracting
talented and skilled employed in the company and increase the level of profitability.
Human resource life cycle:
It is an concept of human resource management that describes that stages of employee
time in particular organization (Lobo, and Samaranayake, 2020). Human resource department
plays each stage of the HR life cycle for effective outcome for employees and organization.
Below is detail explanation of human resource life cycle in the context of The Berkeley.
Recruitment: It is an process of identifying, screening, attracting, and interviewing
potential candidates, according to the skills and talent within an organization. Recruitment also
include the level of effectiveness managers analyze in the candidates in order to provide effective
productivity to the company. In the context of The Berkeley, human resource manager of the
hotel focus on attracting talented employees in organization so that they can help in effective
profitability and growth of the company.
Selection: It is an process of identification of skilled and capable candidates and select
them for appropriate position within an organization. Selection process of the company is
depends on the job position and requirement. In the context of The Berkeley, company select
employees on the basis of their education criteria and appropriate skills and capabilities
according to the job profile.
On boarding and Orientation: Orientation is the event of organization for the welcome
of new employees in the company and provide them information about organizational goals and
objectives. So that they can work for the achievement of those goals and objectives. Whereas,
on-boarding is an series of events in which managers helps their sub-ordinates to understand
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about job rolls and profile and helps them in the achievement of effective performance within an
organization.
Evaluate every step of HR cycle and its importance.
Attraction, Recruitment, selection: In the stage of human resource life cycle
organization focus on attracting skilled and talented employees in the organization(Stoyanova-
Bozhkova, Paskova, and Buhalis, 2020). In the requirement stage managers of The Berkeley,
ensure that they analysis the vacant potions in the hotel and requite candidates according to the
needs and wants of the organization. Whereas managers of The Berkeley ensure that they select
employees in the organization according to the job roll so that they can effectively work within
an organization.
Induction, orientation, on-boarding: In the stages of human resource life cycle,
induction include proper arrangement introduction program in the hotel. In induction program of
The Berkeley the managers of human resource ensure that they provide all the information to the
employees about the hotel.
Career planning and development: Managers of The Berkeley, ensure that they provide
appropriate training to their employees so that it can help them to increase the level of
effectiveness within the organization. This helps employee of the hotel in the enhancement of
skills and capabilities.
Develop a management of performance plan to support particular job role.
This process helps in the enhancement of employees performance within an organization,
performance management plan helps business in the achievement of all the strategic objectives
and goals of the company(Davis, Gough, and Taylor, 2019). In the context of The Berkeley,
managers of hotel is focused on achievement of organizational goals and objectives, they ensure
that employee give effective performance and increase the level of productivity within an
organization. Below is the process of performance management plan is explained in the context
of The Berkeley.
Plan: The managers of The Berkeley evaluate the performance of the employees and
make a effective plan according to their performance. Managers of the hotel ensure that they
make plan according to the goals and objectives of organization.
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Track or monitor: In this stage of performance management plan managers of The
Berkeley, ensure that they monitor and track the performance of the employee for the effective
outcomes and productivity.
Review: After analyzing and assessing the performance of the employee managers of
The Berkeley review the performance and compare it to the expected performance within an
organization.
Rewarding: After evaluation of employee performance managers of The Berkeley
provide the rewards for the excellent performance of the employees.
Judgements and recommendations.
From the above information it can be understand that for the effective human resource
strategy hotel is using various techniques and process that helps them in effective performance
and growth of the organization(Zhao, and Wang, 2019). It can be recommended to the hotel, that
managers of The Berkeley can increase the effectiveness of organization's performance by the
use of talent management and employee engagement in the hotel.
Identify particular legislation.
Legislation is the set of law that have passed by the parliament of UK, these laws and
regulations are made for the employees' health and safety. Government made this law and
regulation for the better protection of interest of employees and customers of hospitality industry.
In the context The Berkeley, managers of hotel ensure that they follow all law and legislation
govern by the government of UK. Below are various legislation passed by the government of UK
for hospitality industry is explained.
Environment legislation Act, 1974: This act was passed by the government in order to
cover number of environmental issues such as water, noise, air and atmospheric pollution as well
as waste on land. In the context of The Berkeley, hotel use various tools and techniques by which
they ensure that they fulfill their environmental responsibilities.
Food and safety legislation Act, 1990: This Act was made for providing the better
quality of food and beverage products to customer. This legislation was made so that hotels
ensure that quality of food and beverage product do not have any affect on the health of their
customers.
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How organisation's employment and contract law affect on business decision making.
In hospitality industry there are various law and regulation that have an impact on the
decision making process of the company (Habets, Jeandarme, and Kennedy, 2020). This
legislations are made due to the protection of business and its profitability in the hospitality
industry. Below are various law are explained that have an impact on the decision making
process of The Berkeley.
Employment law: This law made for the benefit from the minimum charter of
employment rights. This explain interest of employees that employer has to follow in order to
provide them better working environment.
Contract Law: It is a documentation that explain the relationship between two or more
parties that have arrangement that define rights and duties of the government. A contract is
legally enforceable when it meet the requirements and approval of the law.
Analyse potential implications of any two of regulations.
Several implications of law and regulation in the context of The Berkeley is explained below:
Equality and diversity: This law is an legal format that made for the protection of
employees at workplace(Jayes, , Palmer, and Enderby, 2020). In the context of The Berkeley
hotel ensure that they provide healthy working environment and job protect to their employee so
that they can retain them with the organization.
Employment relation act: This law explain the relationship between the employee and
employer. In the context of The Berkeley, hotel helps their employees and staff members to build
secure career within an organization.
Critically reflects on impact of ethical problems of regulations, legislations and principles.
Various regulation and legislation of the government has huge impact on the performance
of the hospitality industry and decision making process of businesses in this industry. The
equality and diversity have huge impact on the requirement process of The Berkeley, by the
impact on the decision making and selection process of the company.
Exploration of various functional roles within the The Berkeley.
There are various functions of the hotel that helps in better performance of organization
and growth in hospitality industry. Below are the various functions of The Berkeley that profive
effectiveness and efficiency in hotel industry:
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Food and beverage department: This function of The Berkeley, hotel ensure that they
provide best quality of food and beverages to their customers and provide them high level of
satisfaction from those quality food.
Housekeeping department: This function of The Berkeley, ensure the cleanness and
hygiene in hotel's rooms, kitchen, and other departments. With safety and protection of hygiene
rooms and kitchens of the hotel housekeeping department provide high level of satisfaction to
their customers.
Describe various communication methods and levels used in company.
There are various communication methods that The Berkeley use for the better
understanding operation and the task performed by the staff members(Brooks, Mosier, and
Bassett, 2020). Below are various communication methods that hotel use for effectiveness in
organization's operations.
Verbal communication: This is the method of sharing ideas, thoughts and opinions to
one person to another person(Slavic, and Horvat, 2020). It is an two way communication
method that helps in better transfer of ideas and thoughts of the person. The Berkeley use this
method of communication for the effective working of operations in the organization.
Non verbal communication: The common aspect of non verbal communication is body
language of person. This communication method also include body movements, gesture and
posture.
Analyse effectiveness of various communication methods, integration and monitoring within
particular department.
Effective communication helps business to decrease communication berries between the
employees and employers. In the context of The Berkeley, effective communication between
front desk department and housekeeping is important for the fulfillment of needs and wants of
the customers. Effective communication also helps in better organization of the hotel
departments.
Valid judgements and recommendations
From the above information it can be recommended to the The Berkeley, that there are
various law and regulation on the hospitality industry that have an impact on the decision making
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process of the hotel. So that respective organization should follow all the rules and regulation of
government in order to make effective working environment and growth of the company.
CONCLUSION
From the above information it can be conclude that effective management of
accommodation and hospitality business helps in better growth and success of the company.
There are various transaction that hotel industry maintain in order to have better insight about
financial position of the hotel and its growth. Also there are various legislation and law of the
government that have an huge impact on the decision making process of the hospitality industry.
Human resource department of the hotel industry play an important role in better arrangement of
goals and objectives of the organization and fulfilment of needs and wants talented employees in
the organization.
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REFERENCES
Books and Journals
Korstanje, M.E., 2020. Experiencing hospitality. International Journal of Contemporary
Hospitality Management.
Murillo, E. and King, C. 2019. Why do employees respond to hospitality talent
management. International Journal of Contemporary Hospitality Management.
Tasci, A.D., 2019. Holistic theory development in tourism and hospitality: a perspective
article. Tourism Review.
Higgins-Desbiolles, F., Moskwa, E. and Wijesinghe, G., 2019. How sustainable is sustainable
hospitality research? A review of sustainable restaurant literature from 1991 to
2015. Current Issues in Tourism, 22(13), pp.1551-1580.
Deszca, G., Ingols, C. and Cawsey, T.F., 2019. Organizational change: An action-oriented
toolkit. Sage Publications.
Stankova, M. and Pashova, R., 2020. Effective Interpretation In Nature-Based Tourism As A
Tool For Sustainability (No. 21). University of Rijeka, Faculty of Tourism and Hospitality
Management.
Jasnoff, G.R. and Sheikh, A., 2019, June. Creating ePortfolios as Components of
Undergraduates Employability Toolkit. In EdMedia+ Innovate Learning (pp. 158-161).
Association for the Advancement of Computing in Education (AACE).
Lobo, S. and Samaranayake, P., 2020. An innovation management assessment
framework. Benchmarking: An International Journal.
Stoyanova-Bozhkova, S., Paskova, T. and Buhalis, D., 2020. Emotional intelligence: a
competitive advantage for tourism and hospitality managers. Tourism Recreation Research,
pp.1-13.
Zhao, Y., Xu, X. and Wang, M., 2019. Predicting overall customer satisfaction: Big data
evidence from hotel online textual reviews. International Journal of Hospitality
Management. 76. pp.111-121.
Habets, P., Jeandarme, I. and Kennedy, H.G., 2020. Determining security level in forensic
psychiatry: a tug of war between the DUNDRUM toolkit and the HoNOS-
Secure. Psychology, Crime & Law. 26(9). pp.868-886.
Jayes, M., Palmer, R. and Enderby, P., 2020. Evaluation of the MCAST, a multidisciplinary
toolkit to improve mental capacity assessment. Disability and Rehabilitation, pp.1-8.
Brooks, C., Mosier, B. and Bassett, M., 2020. Teaching from Home? Now What? Preparing
Your Online Emergency Teaching Toolkit. Journal of Physical Education, Recreation &
Dance.91(6).pp.46-49.
Slavic, N. and Horvat, P., 2020. Sustainability in transportation behaviour in relation to an event
organization. In Faculty of Tourism and Hospitality Management in Opatija. Biennial
International Congress. Tourism & Hospitality Industry (pp. 242-264). University of
Rijeka, Faculty of Tourism & Hospitality Management.
Davis, N.L., Gough, M. and Taylor, L.L., 2019. Online teaching: advantages, obstacles and tools
for getting it right. Journal of Teaching in Travel & Tourism. 19(3). pp.256-263.
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