Hospitality Business Toolkit

This document provides insights into the principles of managing and monitoring financial performance in the hospitality industry. It covers the application of double entry book-keeping system, production of a basic trial balance, and the stages of HR life cycle. It also includes the development of a performance management plan for a specific hospitality job role. The content is relevant for students studying hospitality business and related courses.

Unit 4 - Hospitality Business
Toolkit

Table of Contents
INTRODCUTION...........................................................................................................................3
TASK 1............................................................................................................................................3
P1 Investigation of the principles of managing and monitoring financial performance........3
P2 Application of double entry book-keeping system of debits and credits to record sales and
purchase transactions in general ledger..................................................................................5
P3 Production of a basic trial balance applying the use of balance off rule...........................6
TASK 2............................................................................................................................................7
P4 Reviewing stages of HR life cycle which is applied to a specific hospitality job role and
their importance in retaining and developing talent...............................................................7
P5 Development of performance management plan for a specific hospitality job role applying
techniques to resolve problems..............................................................................................8
TASK 3............................................................................................................................................9
P6 Identification of specific legislation that a hospitality organisation has to comply..........9
P7 Illustration of the way in which employment, company and contract law has potential
impact upon business decision making................................................................................10
TASK 4..........................................................................................................................................11
P8 Interrelation between different functions and roles within hospitality sector.................11
P9 Different communication method, coordination, and monitoring in the department......13
CONCLUSION..............................................................................................................................14
REFERENCES..............................................................................................................................15

INTRODCUTION
Hospitality industry is regarded as one of the major industry which is providing huge
services related with leisure and stay to their customers. The major emphasis of this industry is
related with customers which is to attain high customer satisfaction (Rhou and Singal, 2020).
The industry of hospitality is working for enhancing customer satisfaction so that their
experience can be enhanced and business objectives can be aligned with needs of customers. One
of the prominent aim of hospitality industry is associated with giving quality within services so
that value to customers can be enhanced and this could lead in attaining major benefits to
customer and organisation as well. The industry of hospitality is trying to give best and
appropriate services to their customers and for this different activities are being performed by
them such as planning, organising and analysis. These are activities which are having direct
alignment with goals and objectives of hospitality industry and by this customer satisfaction is
the primal objectives which could be attained. This report is covering major aspects of
hospitality industry in the background of The Ritz which is a luxurious hotel situated in London,
UK. The hotel was started in the year of 1906 and in current time The Ritz is managing their
hotels with high degree of innovation and quality standards. This report is covering analysis of
financial performance of The Ritz and information related to trial balance. Besides this all those
laws and regulations which are required to be followed by hospitality industry. On the other hand
HR life cycle which is going to be followed by The Ritz and communication methods are also
added within this report.
TASK 1
P1 Investigation of the principles of managing and monitoring financial performance
Introduction to the financial transactions
Business transactions are required to be recorded in such a manner that all the input and
output aspects within an organisation. Financial translocations are having direct impact over
profitability of the organisation as they are recording each and every transaction in order to
represent financial information in true manner (Nurjaya, 2018). In the context of The Ritz,
accounting is playing vital role in order to ensure compliance of statutory laws and to provide
safety to their investors so that they can invest in the hotel in appropriate manner.

Source documents are defined as the initial documents in which all types of information
are being recorded in the context of business transactions. They are regarded as documentary
evidence in which all the information associated with books of accounts are recorded. There are
different source document for The Ritz such as petty cash vouchers, cheques received, journal
vouchers, sales credit notes, purchase credit notes and many more. The information from source
documents is recorded in original books of accounts in order to hold it for longer duration of
time.
Recording process: The Ritz hotel is following journal system within managing accounts and
entries. This is helpful for the hotel management to keep record of all their transactions in
chronological order which enhance easiness in finding discrepancies.
Principles of managing and monitoring financial performance
This is highly important that to manage and organise financial performance so that to
inhale appropriate recording of the same. There are numerous principles that can be used by The
Ritz so that to monitor and manage their financial performance and the same are elaborated as
under:
Consistency: This is one of the major principles which is emphasised over managing
financial performance. This is used by managers of The Ritz as with the help of this they can
present and monitor financial performance in optimal manner (Karytsas, Vardopoulos and
Theodoropoulou, 2019)
Justification: According to this principle all the justification related to books of accounts
and records. For managing financial performance the major focus of The Ritz is associated with
analysing actual information and making effective decisions as well.
Timelines: This principle is associated with managers and their tasks in such a way that
they meet all the requirements in timely manner. By accounting professional of The Ritz is using
this principle so that to align their recordings with tasks given.
Documentation: This is a significant principle which is associated with The Ritz and
could be helpful for them in managing financial performance. This is guiding to managers so that
they can keep all those transactions in subtle way so that to manage overall functions during
whole year.

P2 Application of double entry book-keeping system of debits and credits to record sales and
purchase transactions in general ledger
Profit and Loss Statement: This is regarded as the financial statement in which
recording of various income and expenditure for yearly basis (Jang and Kandampully, 2018).
Double entry system is also known as book-keeping or in which process of debit and credit is
being described.
Profit and loss statement of The Ritz for march 2021
Profit and loss statement of The Ritz for March 2021
Particulars Amount Particulars
To Opening Inventory 17000 By Sales 145000
To Purchase 63000 Less : Return Inward -3200
Less : Return Outward -1800 61200 By Closing Inventory
To Gross Profit 84600
Total 162800 Total
To Administration Cost 33000 By Gross Profit
TO Distribution Cost 30500
To Depreciation 9000
To Finance Cost 1600
To Tax 2100
To Net Profit 8400
Total 84600 Total
Effective recording of debit and credit: This is regarded as the procedure of transaction
in which debit and credit entries are recorded. These recordings are further classified in rules of
journal entries. These recording are helpful in managing data in systematic manner so that
appropriate presentation can be done.
Manual addition to computer software to record financial data together with
information
Financial statements are made within an accounting period so that to examine decision
taking in appropriate manner and to align the same with organisational objectives. In current
time by emerging changes within environment people have started to manage accounting with

the help of electronic media so that to minimise manual efforts. These activities are executed in
such a manner that fare representation can be made of final statements (Casado-Díaz and Simon,
2016). The management of accounting is helpful in providing appropriate data along with high
speed and convenience.
P3 Production of a basic trial balance applying the use of balance off rule
Trial balance is defined as the ledger accounts in which arrangement and formation of
credit and debit account is made. These are prepared at the end of every accounting year so that
final statements can be prepared. The rule of set off is associated with recording of debit and
credit and total of them. This can be said that all the accounts are to be balanced at the end of
each accounting period.
Trial Balance for The Ritz
Trial Balance for The Ritz
Particulars Debit Credit
Storage Cost 500
Purchase 10500
Sales 14600
Moter
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
Purchase
Return 70
Salaries 5000
Business Rates 1480

Capital 397060
Total 440830 440830
Role of Trial Balance in identifying rectification of errors: The major role of
examining and determining errors within recording of entries so that errors within debit and
credit accounts can be made. This is helpful for the managers to examine error and rectify the
same in order to make decisions in prompt manner.
Components of Trial Balance: This is associated with account number, debit and
column of credit. The managers of The Ritz are using these aspects in order to provide
components related to list of accounts and balance within debit and credit as well.
Uses of budgets to plan and control:-
Income Stream: This is helpful in generating revenues through profit- margin. The
managers of The Ritz are associated with generating revenue with investments and bearing high
risk over returns.
Fixed cost and variable cost: The fixed cost is associated with those expenses which are
fixed and doesn’t fluctuate with variation of sales or production(Buhalis and Leung, 2018).
There are some costs which are fixed for The Ritz such as wages, rent and salaries. The variable
costs are defined as those costs which are varying as according to level of output or production.
For The Ritz the major variable expenses are direct material, labour and overheads.
Pricing strategies and setting realistic goals: The pricing strategies are defined as cost
which is required to be acquired within production of a specific product and can be consumed
with margin profit as well. Managers of The Ritz are trying to implement cost plus pricing
strategy so that to maximise their profit margin to longer range.
From the above task this can be concluded that there are various principles which are
used by hospitality businesses in order to manage and monitor their financial performance so that
to make recording process easier and to examine profit and loss for a particular financial year. In
the context of Ritz hotel group by preparing appropriate financial statements funds can be used
by the organisation in optimal manner along with avoiding areas of mismanagement. Besides this
there are various pricing strategies that can be used by The Ritz for the purpose of deciding their
profit margin and to intensify their range.

TASK 2
P4 Reviewing stages of HR life cycle which is applied to a specific hospitality job role and their
importance in retaining and developing talent
The Ritz is managing their business in such a way that high degree of control and direction
can be rendered so that they are able to manage all of their franchise in appropriate manner. The
HR manager is implementing various polices and structure within the business so that to inhale
high edge efficacy and efficiency and to align goals and objectives in appropriate manner.
HR Life Cycle:- This is defined as the stages which are being followed by employees in
order to perform in better manner within an organisation. The HR manager of The Ritz is
concentrating over enhancing internal strength of their employees so that they can deal with
market complexities in appropriate manner (Iordanoglou, 2018). Besides this it would be
advantageous for The Ritz to acquire higher edge as in comparison of their rivals in order to
bring higher success and sustainability. The life cycle is elaborated as under:
Illustration 1: HR Life Cycle
Recruitment: This is the process which is associated with filling up of vacant position
within job area or some specific job role. The HR manager of The Ritz is using this step in order
to recruit appropriate people for job roles such as reception, housekeeping and chef.
Selection: Under this process suitable candidates are selected over the job role as
accordance with their qualification and job requirement. The HR manager of The Ritz is required

to recognise appropriate candidate for their vacant job role by taking help of interviews so that
they can perform given tasks in suitable manner.
On boarding and Orientation: This is the process which consent from employees so that
to prepare them for their job role and designation with optimal capabilities and appropriateness.
The HR manager of The Ritz value their employees so that to render positivity within working
environment of organisation.
Exit and transition: Under this process employees leave the organisation by voluntary or
compulsion movement and get retirement from their responsibilities and authorities. The HR
manager of The Ritz is using this process in order to provide retirement to their existing
employees so that new skills can be admitted (Adeola, 2016).
Different recruitment methods:- There are various methods that can be used by The Ritz
in order to recruit employees and align them with proper managing of business objectives. This
is helpful in enhancing employee retention for longer duration of time. By direct advertising or
talent pool skilled employees can be recruited.
P5 Development of performance management plan for a specific hospitality job role applying
techniques to resolve problems
Performance Management Plan
This plan is defined as the procedure which is used in order to recognise various activities
those are aligned with employees and their efforts of goal attainment towards business
organisation. The HR manager of The Ritz is implementing this plan so as to control
performance of their employees and directing them towards attaining organisational goals and
objectives. The major role of food and beverage is to manage quality within food and beverages
served by the organisation (Wang, Hung and Huang, 2019). These services are helpful in
attracting customer and providing luxurious services and customer satisfaction as well.
Performance management plan: The following table is elaborating performance
management plan for newly appointed Supervisor for The Ritz:
Objectives Providing training Review performance Monitoring and
control
Promoting diversity
and equity
Diversity and equity is
acceptance of different
By providing
appropriate appraisal
For monitoring of
growth in appropriate

culture, age, sex,
colour and religion by
all the people.
and promotion
Supervisor of The Ritz
can review
performance of each
and every employee in
significant manner.
manner all the
dimensions are
required to be
considered by
Supervisor so that to
establish prominent
tools for control and
monitoring.
Managing
international and
multicultural teams
The Ritz is rendering
various services to
their guests and in this
manner differentiated
groups are managed
by the organisation so
that to include team
diversity.
The Ritz is giving
remarkable rewards to
their employees those
are performing good.
For development and
growth of company it
is essential to evaluate
different teams so in
order to monitor
Supervisor is
analysing performance
of each and every
employees in apt
manner.
TASK 3
P6 Identification of specific legislation that a hospitality organisation has to comply
Legislation is defined as the statutory laws which are governed by various regulations and
government of UK. These are imposed in order to provide safety and protection to employees
working. In the industry of hospitality various legislations related to health and safety are used so
that to provide proper assistance and customer satisfaction to them. Implications of legislation
may lead to face different challenges such as cyber theft, data protection and many more. Some
prominent legislation are elaborated as under:
Environmental Legislation Act, 1974: This is defined as the issues which are arising
due to industrial waste and impact air, water and atmosphere. The Ritz hotel is using such
business practices by which waste can be minimised and lesser harm can be rendered to
environment.

Food Safety Legislation Act, 1990: This legislation is having major responsibility of
managing food service and quality of food. This is ensuring that food is made with optimal
making standards and contains appropriate quality measurements.
Consumer legislation Act, 2019: This is defined as act in which rights of consumers can
be protected in such a way that problems within business can be minimised (Baker and Magnini,
2016). The business manager of Ritz is implementing this law so that to avoid any delay in
customer satisfaction and goal attainment.
P7 Illustration of the way in which employment, company and contract law has potential impact
upon business decision making
There are various potential impacts on their strategic decision-making approach through
the different legislations and laws governed. These laws are in place to ensure regular control
over business activities and restrict any kind of illegal and unlawful operations with the purpose
of accomplishing their business goals. Like other organizations, Ritz Hotels to have implemented
different laws to restrict any harmful activities by society and manpower while focusing on its
prime objectives. The laws in place are described below:
Employment Law:- This law is meant to regulate relationship of employee and
employer and various laws are defined to regulate the complete hiring and employment process.
This law impacts the policy of hiring the employees and their activities (Oskam, Dekker and
Wiegerink, 2017). The manager of Ritz Hotel has implemented this law in their organization to
ensure the healthy employee & employer relationships and comply with various employment
laws. By using such practices The Ritz can maintain satisfaction and harmony within employees
so that employees can provide their optimal contribution in business processes.
Company Law: - This law is imposed with view of directing and controlling companies
and ensure that they have legal and lawful objectives and path to achieve those goals with the
motive of maximizing profits. The manager of Ritz Hotels has followed this law since it is
mandatory requirement as well as to ensure safety, health and welfare of employee and society to
motivate them to stand with the organization. By implementing Company law The Ritz can
ensure regarding no disruptions in business functions to their stakeholders so that to provide
smooth functioning to functions.
Contract Law:- This is legal and lawful binding to carry business activities between two
parties and enter into an agreement. The managers of Ritz Hotel have implemented these to

ensure every agreement is in accordance with government rules and regulations. Contract law is
helping The Ritz to get assistance over any breach made out of any contractual capabilities
performed. Besides this the Act is associated with legally binding of any contract so that these
can be enforced by law and intent of contract can be met by The Ritz in appropriate manner.
TASK 4
P8 Interrelation between different functions and roles within hospitality sector
Organisational Structure of Hotel:
Organisational structure is playing significant role in managing various business
functions in appropriate manner. In the context of hospitality industry organisational structures
are elaborated as under:
Organisational Structure of Carnival Cooperation Plc :

Organisational Structure of Theme Park:
Organisational structure of hotel :

Hospitality industry includes various businesses such as Hotels, restaurants, theme parks,
tourist agencies etc. and each business has their own roles, organizational structures which are
interlinked with each other. Some of the interlinked departmental functions are given below:
 House Keeping and Front desk: are two key departments in hospitality sector. It is
important for smooth functioning of hospitality sector to have strong interlinked between
each other (Ariffin and et. al., 2018). Housekeeping department has responsibility of
cleaning guest rooms and providing any required service or assistance to room whereas
front desk is concerned with arrival and departure activity of guest. Interlink helps to
provide clean rooms to guest and improve Ritz’s brand image.
 Food & Beverage service and Food Production department: This plays key role in
hotel and hospital industry. Food & beverage department has function to serve food items
to customers that are prepared by food production department as per demand and taste of
guests.
Business mission and goals: The main mission and goal of The Ritz is to provide ultimate
satisfaction to their customer so that to attain higher business growth and developmental
opportunities. With the help of appropriate coordination and integration all the associated people
and parties can be included with business working in such a manner that mission of the
organisation can be accomplished.
Communication methods: In order to convey various information to different parties direct
method are used as this will provide specific edge in Delegation and providing Responsibilities

so that to monitor organisational functions in significant manner. For reporting structures
integration and coordination is effective to be executed as by adopting prominent channel of
communication reporting can be made easier.
P9 Different communication method, coordination, and monitoring in the department.
Multiple methods of communications used by Ritz hotels are given below:
 Conference: This method is used generally used to discuss strategies by high authorities
and board of directors for decision making. This is more f used by F&B department.
Video conferring is an additional way of conferencing.
 Seminar: Seminars can be initiated to reach mass audience together and to motivate and
boost morale of the employees to perform better and as per Ritz hotels customer needs.
 Email: This is the most formal way of communication used to communicate any vital
information in organization. Any employee in the organization can send or receive any
important business communication.
 Text Message: This is an informal mode of communication that can be used by
management of Ritz hotels to send any informal or unofficial communication to their
employees.
 Delegation: It is a way of monitoring and coordinating business activities as it enables
management to delegate task and duties to subordinates and get the work done in
desirable manner.
 Policies and Procedures: Policies and procedures are framed for managing the work and
employees in F&B department of Ritz Hotels. With the help of this it will be smoother to
guide employees and their activities.
 Face to face communication: This is the method which can be used by The Ritz as their
key method. This method building trust among team members as body language can be
interpreted which makes understanding in prominent manner.
 Team messaging application: By using team messaging applications degree of
informality can be provided in flow of information due to which messages can be
surpassed without any prominent barrier. This method is helpful for The Ritz to provide
appropriate satisfaction to needs of their guests.

Importance of the methods to strengthen value chain
With the use of this method the manager of Ritz hotels will be able to frame the most appropriate
business policies with respect to business objectives. The reason for its much importance is that
it flows information in most formal and sequential manner. Most effective communication can be
placed, and chances of errors and gaps can be reduced in significant manner. Moreover, it will
help management in guiding and motivating its employees in effective manner which would
ultimately result in increase in productivity (Ahmad, Bakar and Ahmad, 2018). The goals and
visions can be achieved smoothly with the proper co-ordination in desirable manner. The senior
person in this tool chain can guide its employees and subordinates effectively by ensuring
optimized plans for various organizations and departments.
CONCLUSION
From the above report this can be concluded that there are different measurements which
may impact business functions in positive or negative manner. There are some set of rules which
are made and imposed within an organisation so that business functions can be aligned with
attaining organisational objectives. Performance management is playing significant role in
solving problems at early stage and minimising complexities of business.

REFERENCES
Books and journals
Adeola, O., 2016. Human capital development in the hospitality industry in Nigeria. Worldwide
Hospitality and Tourism Themes.
Ariffin, A.A.M., Maghzi, A., Soon, J.L.M. and Alam, S.S., 2018. Exploring the influence of
hospitality on guest satisfaction in luxury hotel services. E-review of Tourism
Research, 15(1).
Baker, M.A. and Magnini, V.P., 2016. The evolution of services marketing, hospitality
marketing and building the constituency model for hospitality marketing. International
Journal of Contemporary Hospitality Management.
Bratton, J. and Watson, S., 2018. Talent management, emotional labour and the role of line
managers in the Scottish hospitality industry. Worldwide Hospitality and Tourism
Themes.
Buhalis, D. and Leung, R., 2018. Smart hospitality—Interconnectivity and interoperability
towards an ecosystem. International Journal of Hospitality Management, 71, pp.41-50.
Casado-Díaz, J.M. and Simon, H., 2016. Wage differences in the hospitality sector. Tourism
Management, 52, pp.96-109.
Gu, X., Sheng, L. and Yuen, C.Y., 2019. Inbound Tourism, Hospitality Business, and Market
Structure. Journal of Hospitality & Tourism Research, 43(8), pp.1326-1335.
Iordanoglou, D., 2018. Future trends in leadership development practices and the crucial
leadership skills. Journal of Leadership, Accountability and Ethics. 15(2).
Jang, J. and Kandampully, J., 2018. Reducing employee turnover intention through servant
leadership in the restaurant context: A mediation study of affective organizational
commitment. International Journal of Hospitality & Tourism Administration, 19(2),
pp.125-141
Karytsas, S., Vardopoulos, I. and Theodoropoulou, E., 2019. Factors affecting residents’ attitude
toward sustainable tourism development. Tourismos, 14.
Nurjaya, I.N., 2018, November. Sustainable tourism development of Indonesia: Policy and legal
politic point of view. In International Conference on Business Law and Local Wisdom
in Tourism (ICBLT 2018). Atlantis Press
Oskam, J.A., Dekker, D.M. and Wiegerink, K. eds., 2017. Innovation in hospitality education:
Anticipating the educational needs of a changing profession (Vol. 14). Springer.
Rhou, Y. and Singal, M., 2020. A review of the business case for CSR in the hospitality
industry. International Journal of Hospitality Management, 84, p.102330.
Wang, S., Hung, K. and Huang, W.J., 2019. Motivations for entrepreneurship in the tourism and
hospitality sector: A social cognitive theory perspective. International Journal of
Hospitality Management, 78, pp.78-88