Unit 4 - The Hospitality Business Toolkit

This document discusses the principles of managing and monitoring financial performance in the hospitality industry. It covers topics such as preparing financial reports, maintaining inventory, and analyzing overhead costs. The document also includes information on the HR life cycle, performance management plan, and legislation that hospitality firms need to comply with.

Unit 4 - The Hospitality
Business Toolkit

Table of Contents
INTRODUDUCTION .........................................................................................................................3
Activity 1- PART 1...............................................................................................................................3
TASK 1 ................................................................................................................................................3
P1 Examine the principles of managing & monitoring of financial performance .........................3
P2 Use double entry bookkeeping system of debits & credits to record sales and purchases
transactions in a general ledger........................................................................................................4
P3 Present a basic trial balance applying the use of balance off rule to complete the ledger..........7
Activity 2- PART 2...............................................................................................................................8
TASK 2.................................................................................................................................................8
P4. Various stages of the HR life cycle and role in retaining the talent...........................................8
P5 Analyse performance management plan in hospitality job role applying techniques to solve
negative behaviour & deal with issues of staff retention ................................................................9
TASK 3...............................................................................................................................................10
P7 Give examples how firm, employment & contract law has potential impacts on business
decision making.............................................................................................................................11
Conclusion..........................................................................................................................................13
REFERENCES ..................................................................................................................................14
Books & Journal:...........................................................................................................................14

INTRODUDUCTION
Hospitality refers to the relationship which is between guest and host. In this, host provides
their services to their guest which is one of the better services. Hospitality includes event planning,
lodging, theme parks, food and drink services and transportation and many more (Albizri, 2019).
This report is based upon Premier Inn which is an international hotel which is there able to provide
high quality of services to their customer and is located in UK. This hotel has many competitors like
The Ritz Carlton London, Fore Season hotel & resorts, etc. This is a luxurious hotel which
introduced electric lifts and lights throughout the building also containing hot and cold running
water and having much innovation in their premises. This report consist of HR role in business, HR
life cycle along with management plan which helps in conflict solving along with this there are
different rules and legislation.
Activity 1- PART 1
TASK 1
P1 Examine the principles of managing & monitoring of financial performance
In business, it is important to focus on financial performance of business so that goals are
accomplished in proper manner. Finance is important part without which it is not possible to
execute business activities. It is necessary to manage and monitor the financial performance so that
it is easy to achieve goals. In relation of Premier Inn, it is large firm and has wide range of chains
all across the globe. It is essential to be aware about financial performance so that it is easy to use
the methods in proper manner. So, various types of financial performance principles are discussed
as follows-
Preparing financial report- Financial statement is defined as written document that defines
the financial position of business. Basically, three statements are being prepared which are profit
and loss, balance sheet and cash flow statement. With help of these financial statements, it is easy to
depicts the how well entity is performing financially. All these statements are essential to be
prepared by finance department of firm (Dedusenko, 2017).
Maintaining inventory- It is also essential principle of financial performance because it is
critically important to carry out functions as well as operations of business properly. It is necessary
to maintain inventory so that needs and demands of customers are fulfilled appropriately. In relation
of chosen hotel, they manage inventory with proper considerations.
Analysis of overhead- Overhead refers to costs that not directly related cost units. There are

various kinds of overhead costs such as rent, insurance, sales & marketing, administrative costs etc.
It is necessary for selected entity to be well aware about these type of costs so that decisions related
to costs are undertaken in proper manner.
Therefore, from above stated matter it is seen that it is essential to focus on these principles
so that positives benefits are achieved easily, Also, it is has been specified that it is necessary to use
these principles with proper considerations (Gupta, 2019).
P2 Use double entry bookkeeping system of debits & credits to record sales and purchases
transactions in a general ledger
In an organisation, it is essential to focus on accounting terms as they help in understanding
of business operations properly. So, some financial terms are further explained as follows-
Book keeping-
It refers to process of recording of cash transactions that are done within business (Hanley,
2020).
Double entry-
It is defined as for every debit there is credit of same amount. It is necessary to understand
this double entry system so that transactions are managed accordingly. In reference of Premier Inn,
they manage & maintain journal within their record of ledger & classify them accordingly.
Journal-
It refers to written document in which all transactions are being recorded first time. It is
also known as book that contains all details of every transaction in systematic manner.
Ledger-
A ledger is defined as book that contains record of every transaction into classified and
summarised-form.
In viewpoint of chosen hotel, the finance and account department is well aware of these
terms and them these documents with proper considerations. Bookkeeping, double entry, journal
and ledger both are crucial for recording of transactions (Jan, 2018).
There are three essential principle which is used in bookkeeping system that are considered as
a separate entity concept through which the organisation focuses on having their own legal article.
In addition to this, the principle related to accounting equation that is described regarding Assets –
Liabilities = Capital. Then, tthe principle signifies regarding every transaction that imposes direct
effect on another transaction that is determined as a dual effect.
Balance sheet of Hotel
Assets Amount Liabilities Amount

Insurance 1200 Current liabilities 15000
Current assets 52000 Fixed liabilities 54490
Fixed assets 94000 Capital: 30000
NP: 47710 77710
Total 147200 Total 147200
On the basis of above given balance sheet of organisation, it is assess that all principle
related to bookkeeping system must be followed by finance department. The organisation makes
sure to maintain balance sheet according to need and wants.
From above stated matter, it is seen that is essential to be aware about financial statements so
that decisions making regarding finance and other activities are being carried out in proper manner.
It is critically crucial for business and finance department to have proper communication so that
statements are being prepared in effective manner.
P3 Present a basic trial balance applying the use of balance off rule to complete the ledger
In organisation, it is necessary to record transactions so that recording of transaction is done
in proper manner. Data and credentials which is being gathered through ledger is further posted into
trial balance. So, trial balance is crucial which is to be used with proper considerations. Every entry
which is being recorded in journal as well as ledger is then posted into trial balance. In case of
Premier Inn, they too use trial balance. Ledgers as well as trial balance both are important for
completion of trial balance in proper manner. Furthermore, it is also seen that it is critically crucial
to focus on such financial accounting terms (Lofamia, 2017).
Trial balance-
A trial balance refers worksheet of bookkeeping in which all balance of ledgers are
recorded into debit & credit & their equal amount is matched. Main aim of trial balance is to assure
the entries within accounts in organised manner. Premier Inn prepares trial balance on yearly,
monthly basis.
Advantages
 Main benefit of this trial balance is that it summarizes all the transactions within time
period.
Limitations
 Trial balance does not reflects that every transactions has been recorded in proper manner.
 Further drawback of this statement is that it is not possible to identify or track missing entry
from ledger (Mehmood, 2020).

Particulars Amount Particulars Amount
Rent 1000 capital 30000
Purchases 10000 Food supplies 2000
Insurance 1200 Sales 20000
Petty expenses 200 Sales of beverages 13000
Telephone and internet 2200
rates, water charges and refuse 950
wages and salaries 1740
Net profit 47710
65000 65000
It is essential to be aware about trial balance so that it is easy to make decisions regarding
financial and other business activities in proper manner. With help of trial balance, chosen entity is
able to analyse their financial transactions in effective way.
Analysing kinds of cost
There are various kinds of cost that is taken place within company as administration possess
to track all records to explore activities and functions of business organisation in an effective
manner.
Net profit margin example:
NP margin = NP / Sales revenue*100
= 25000/105000*100
= 23.80%
Gross profit margin example:
GP margin = GP / Sales revenue*100
= 18500/105000*100
= 17.61%
Activity 2- PART 2
TASK 2
P4. Various stages of the HR life cycle and role in retaining the talent
HR is important person in business without which it is not possible to execute activities of
firm and other procedures in proper manner. Main role of HR is to regulate as well as formulate
policies in appropriate way so that it is easy to manage individual within enterprise. Human
resource of firm make assures that objectives are achieved in correct way (Pistor, 2020). In context
of Premier Inn, they also have human resource department and HR of firm who has capability to
deal with problems, implement strategies, scan business environment etc. There are several stages
which are being followed by human resource of Premier Inn & are further explained as follows-
 Selection, attraction, recruitment – In hospitality sector, it is essential to focus on roles

and responsibilities in proper manner. In relation of chosen hotel, it is important for human
resource to attract, recruit and do the selection of candidates. The recruitment and selection
is done by human resource of firm on basis of which experience, knowledge & skills.
Mostly they prefer candidates from hotel management background. Attraction is also crucial
as it helps in identifying of right candidates for vacant posts.
 Induction & orientation- When new candidates are selected as employee within firm, it is
necessary to be provide a brief introduction to employee regarding their roles,
responsibilities. So, HR of hotel conducts induction and orientation to make employee feel
as comfortable and friendly work environment (Wichasin, 2017).
 Career planning & development- After joining of employee within entity it is essential for
them to look after about their growth and development. Career and planning development is
crucial is important for every individual. In context of Premier Inn, co-counselling sessions
and activities are carried out which makes aware employees about their growth as well as
development.
 Retention- It is also essential stage of HR which is needed to be executed so that
productivity is increased at higher scale. It is crucial for firm to retain employees for longer
period. In reference of Premier Inn, employees retain for longer time interval as it is a well-
known brand & growth is also high (Williams, 2017).
 Separation and termination stage- This is also to be considered as crucial aspect in which
employees get separated and leaves job. Further, it is examined that subordinates within HR
department properly communicate with subordinates & identify the problems encountered
by them & reason for leaving of job.
P5 Analyse performance management plan in hospitality job role applying techniques to solve
negative behaviour & deal with issues of staff retention
Performance management plan refers to path way or gate way through which improvement
is done with aim of achieving strategic goals of firm. Planning is needed at every aspect and it is
essential to focus on this PMP. In hospitality sector, it is critically necessary to focus on improving
of performance so that competitive benefits are achieved. With help of PMP, employee is able to
analyse their own performance & accordingly decisions are taken.
In context of chosen hotel, it is further discussed as follows-
 Coaching- In this step, main focus is on providing of training sessions and help to
subordinates. In firm, it is crucial to provide training & development to employees so that

work is done properly. Directing is necessary to be done so that both everything is carried
out in proper manner.
 Appraising the performance- It is aspect in which work which is done by employees is
being examined and analysed. By appeasing the performance, employees get motivated
towards more achieving of better output. Appraisal is necessary as because it encourages
employees to work hard. Appraisal can be both paid as well as on paid relying on supervisor
decisions. So, Premier Inn hotel provide appraisal after a internal review of employees at
workplace.
 Action- It is last aspect in which entity take final action after determining of performance.
Employees with higher performance is able to get reward and whereas subordinates with
low performance do not get appraisal. The final decision is being taken by supervisors of
hotel and then performance appraisal is given. So, it is necessary to be aware about detail
information of subordinates so that actions are being taken effectively.
Thus, from above matter it has been examined that it is essential for develop a performance
management plan so that goals are accomplished easily. It is time consuming process which is
needed to be carried out in proper manner.
TASK 3
P6 Analyse legislation that hospitality firm has to comply
In business, it is necessary to focus on rules and regulations so that goals are accomplished
without facing any issue or problem. Legislation are rules are that are enforced by government. In
context of Premier Inn, they are large entity and carry out their every activity with proper
considerations. It is necessary to have knowledge about legislations so that it is easy to deals with
business problems in effective manner. Further, positive relations are needed to be maintained so
that it becomes easy for entity to consider every rules in correct way. In service sector, there are
several types of legislations which are needed to be focused and are explained as follows-
Health and Safety Law Act, 1974
According to this act, it states that healths of employees are to be kept secured at workplace.
It is important to make ensure that safety measures and procedures are undertaken. In reference of
Premier Inn, they provide insurance, wages, salary, to employees. Also, with rise of COVID 19
Premier Inn checks and has made it compulsory for every individual top wear masks at workplace.
With consideration of this act, subordinated retention period increases at higher scale. Moreover,
bonuses and perks are also given to employees every year based on their performance.
Trade Description Act, 1968

It is type of act which states that goods and products of firm are needed to presented in
ethical manner. Main aim of this act is to prevent entities from showing their goods in misleading
procedure. In reference of Premier Inn, they have large number of suppliers at global scale and they
assures that every products as well as goods are being traded with appropriate procedures. Main
benefit of this act is that it helps in producing and distribution of products in well organised way.
Equality Act, 2010- It is another act in which it specifies that employees are treated as equal
regardless of any discrimination. It is necessary to treat every employee in equal manner so that
conflicts do not occur at workplace. For example- there many firm that discriminate employees on
basis of age, culture, gender etc. In relation of selected entity, human resource of a firm is well
aware about internal activities of company. So, it is easy to access activity where employees are not
treated equally. By treating every subordinate as equal leads to increasing of productivity at higher
level and accessing to better workforce development.
Environment legislation Act, 1974- According to this act, it specifies that it is crucial to
protect surroundings so that resources are used efficiently. In case of hospitality industry & chosen
firm Premier Inn, they use resources at higher and wider scale. It is important for hotel to hire
environmental practitioners so that effective strategies are implemented to protect environment. For
example- selected hotel aims at reducing of waste products and adopts appropriate measures. They
also establish campaigns which helps them in increasing awareness to protect surroundings.
Therefore, from above discussed matter it has been seen that it is necessary for entity to
focus on rules, regulations, so that it is easy to execute business activities. In this competitive era,
hospitality sector need to be active when establishing introducing new products or services with
appropriate considerations of governmental laws. So, human resource of company should conduct
internal scanning so that these legislations are properly analysed.
P7 Give examples how firm, employment & contract law has potential impacts on business decision
making
Business is wider and broader and it is essential to focus on development of activities &
other functions. Laws as well as legislations are important to be focused so that it is easy to execute
business activities. It is critically necessary to states that these laws have direct impact on decision
making. In relation of chosen firm, it is seen that HR of company is required to be well aware about
such types of laws so that better output is achieved. Therefore, both employment and contract law
are further described as follows-
 Employment law- It is type of law that reflects and governs the employer & employee
relationship. It clearly specified what employers ask to do and what employees has rights at
work. It is necessary to have relevant knowledge about these so that both parties are able to

access and achieve common desired goals at appropriate level. In relation of chosen hotel,
HR of company delivers all information to both employer & subordinates with a written
letter and agreement.
Impact on decision making-
This law impact on decision making as any error or mistakes in form of agreement might
leads to big problems. It is essential to make ensure that in agreement everything is properly cleared
so that it is easy for both parties to work accordingly in relation of Premier Inn, they both parties
sign the document after reading all the considerations (Albizri, 2019).
 Contract law- It refers to act in which agreement is exchanged between two or more than
two parties in order to complete a specific task. For example- such type of agreements
includes bills of sale, purchase order etc. In context of Premier Inn, they also focus on
contract law & it helps them in accessing to completion of work properly.
Impact on decision making
This law also affects upon decision making because it is not easy to maintain the contract
law and trust is required to carry out the contract for longer period. It has been also analysed that
appropriate type of relations are to be maintained so that objectives are achieved.
Therefore, from above explained matter it is examined with gaining knowledge of proper
laws and government rules it is easy to access competitive benefits (Dedusenko, 2017).

Conclusion
From above discussion, it can be concluded that hospitality industry is high in demand and
have wider concept which includes restaurants, hotels and bars. In this report there is discussion
about Premier Inn hotel. There is also discussion about the HR life cycle which helps in motivate
and retain employee in organisation. There is management plan which helps in reducing the
negative impact which is there in mind of employees. There is some discussion about the
importance of law and their applicability in hospitality sector. This can help in to enhance overall
performance of firm. So, it is analysed it is necessary to focus on market and changing situations so
that decisions are made in most effective manner.

REFERENCES
Books & Journal:
Albizri, 2019. Evaluation of financial statements fraud detection research: a multi-disciplinary
analysis. International Journal of Disclosure and Governance, 16(4), pp.206-241.
Dedusenko, 2017. Hospitality investment environment in Russia. Journal of Environmental
Management and Tourism (JEMT), 8(02 (18)), pp.291-300.
Gupta, 2019. Environmental enforcement and compliance in developing countries: Evidence from
India. World Development, 117, pp.313-327.
Hanley, 2020. Cancellation of principal in banking: Three radical ideas emerge from deep
examination of double entry bookkeeping in banking. arXiv preprint arXiv:2010.10703.
Jan, 2018. An effective financial statements fraud detection model for the sustainable development
of financial markets: Evidence from Taiwan. Sustainability, 10(2), p.513.
Lofamia, 2017. Addressing timeliness of submission of trial balance: an action research using
cooperation levers in CGM local government-Bookkeeping Division of the Accounting
Department.
Mehmood, 2020. Finance in the Hospitality Industry. In Contemporary Management Approaches
to the Global Hospitality and Tourism Industry (pp. 185-212). IGI Global.
Pistor, K., 2020. Law in the Time of Covid-19.
Wichasin, 2017. A Model for Competency Development of Thai Tourism and Hospitality Business
Entrepreneurs for Operating International Business within the ASEAN Economic
Community (AEC). Journal of Management Cases, p.34.
Williams, 2017. Regulating the sharing economy to prevent the growth of the informal sector in the
hospitality industry. International Journal of Contemporary Hospitality Management.