Finance and Funding in Travel and Tourism Sector - BTEC Assignment

This report analyzes the application of finance and funding principles within the travel and tourism sector, focusing on the Dalata Hotel Group as a case study. It explores the use of management accounting information, including financial statements (balance sheets, income statements, and cash flow statements), budgeting, management information systems (MIS), and forecasting. The report details how these tools aid in decision-making processes, such as controlling expenses, assessing financial status, and making future estimations to maximize profits. It also covers the importance of budgetary control, financial statement analysis, and activity-based accounting in making effective decisions. The report references key concepts and current issues affecting business decision-making, such as profitability and solvency.

Finance and Funding in the Travel
and Tourism Sector

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Management information System:
 MIS collect all the information and system
and hardware that all work together to
produce the correct information for the
company.
 It help in decision making and through this
management system employees are able to
communicate their views to the outside of the
organization.
 It produces data reports which help the
management team to take correct decision for
a company.

P 2.1 different types of management
accounting information used in travel
organisation
Dalata Hotel Group is the largest hotel operator in
Ireland's who have four star hotel including 7700
rooms. The company uses different management
accounting information in order to know its
financial status such as financial statement,
budgets, variance analysis, Management
Information system, forecast and this are describe
below:

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 Financial Statement: this statement are
used to determine the exact financial status
of a company. This statement include three
basic statements such as
Balance sheet: it shows the net profit or loss
of a company and it shown asset and
liability side of a company and prepared in
last.

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 Income statement chart: it is also called profit
and loss account which include all the
information related to profit and loss during a
particular financial year.
 Cash flow Statement: this statement show the
how much cash flows during a time in a
company.
 This is the most important management accounting
system because it decides the company is in loss or
profit as compared to last year and it help to
determine the capability of a company to pay its
debt and how much cash is generated and its
expenses during a period.

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Budget:
 It is an estimation of finance which is used in future
period of time.
 Deciding budget for different departments in a
company is necessary because it will help to
controlling on extra expenses.
 The Dalata Hotel Group have master budget and
then it divide that budget into different departments
in order to run a company in better way.
 Usually budgets are decided in meeting in order to
face future risk and to run a company in effective
way.

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Management information System:
 MIS collect all the information and system
and hardware that all work together to
produce the correct information for the
company.
 It help in decision making and through this
management system employees are able to
communicate their views to the outside of the
organization.
 It produces data reports which help the
management team to take correct decision for
a company.

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Forecast:
 Management accounting help to make
assumption for future expenses. With the help
of present financial statement, the owner can
easily judge the future outcomes of a
company and it also prevent in some mistakes
done in future.
 Through forecasting futute decisions are
made which help to maximizes the future
profit and increases its present revenue so
that it will help in future generations.

2.2 Assessing use of management
accounting information in
organisation for decision-making
Management accounting tools are help in
decision making in many ways such as :
 Management accounting information help
in decision making by collection all the
information .
 By preparing financial statement reports,
can easily determine the actual status of a
company and it will help in future
decisions.

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 Through management accounting
information, the effective decision can be
make because it help to keep all records
safe during a period.
 Budgetary control planning will help to
control on the price or cost of the products
which are offered to the customers. It also
help to make effective decision planning.

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 Through forecasting, an effective decision
are taken.
 Because it help to determine the exact
position of a company and also determine
the future estimation required for a
company.
 To provide best result and maximum
return and profit, investment are help to
take better decision for their company and
it will help to make future estimations.

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 Management accounting information is helpful in
provide complete information about a company
and by make and buy analysis, owner can easily
determine the choice of customers and it help to
make effective decision power of a company.
 Budgetary control, financial statement and
activity based accounting are always help in
taking better decision for a company and achieve
all the target objectives.
 There are so many current issue which affect the
decision making of a business such as profitability
of a company, solvency and to control all the
assigned budgets of different departments etc.