Conquer Your Accounting Challenges to succeed in Hospitality Business
The hotel industry has always been one of the most challenging industries to manage, primarily because they have a unique set of accounting challenges. This is due in part to the onerous requirements for records management and reporting compliance, as well as the often complex nature of transactions. As a result, many businesses are turning to cloud-based accounting software solutions with increased frequency in order to help them achieve greater efficiencies, stability, and compliance.
If you’re an owner, manager, or accountant for a hotel, you know first-hand that hotel accounting is an unforgiving process. The difficulty lies in the fact that each hotel is a business with its own set of needs and goals. There’s not just one solution to fit everyone’s needs – but with hotel accounting software you’ll be able to address all your hotel accounting needs.
The need to keep up with finances is always among your top priorities. A cloud-based accounting system can solve some of these issues. These challenges faced by hospitality professionals are among the most prevalent in this industry:
1) High number of transactions – A hotelier could have hundreds of transactions during any given day.
2) Costly software licenses – Many smaller hotels don’t have enough funds for license purchases and maintenance fees.
3) Difficult to use software – Many accounting and financial systems are complicated to use. This can mean that hotel staff need training to get accustomed to software.
4) Management overhead – “Numerous small tasks can take up a lot of time, resulting in inefficiency and wasted opportunities.”
5) Inadequate security – A majority of hotels are NOT using strong passwords and connections between accounts. This makes the entire computer network fragile, which increases the chance of data loss or theft.
By deploying modern cloud-based accounting software, you can help your business improve bookkeeping process efficiency as well as security and cost-savings.
1) A hotel manager can use the Cloud-based Hotel Accounting Software to upload payments and make purchases.
2) With a cloud software solution, owners or managers can make payroll and other payments.
3) If a manager needs to quickly retrieve financial data, he or she can log into the accounts via smartphone, tablet or laptop.
4) Software allows for easier balance sheet management, with quick reporting and analysis for better management decisions.
5) Using cloud-based accounting software is easy as well as affordable for small hotels due to the zero-maintenance fees.
Read on more to learn more about common challenges faced by hotels and how cloud-based accounting software can make them easier!
Cloud-based accounting software solutions are geared towards helping you overcome the most common challenges that all hotels face:
- Find and manage all your receivables
Many hotels focus on controlling the amount of money coming into their business but overlook the money that’s leaving. When it comes to tracking all your receivables, start with these accounting system which lets you track all funds received in hotel.
- Managing your expenses and controlling your costs
Hotel Accounting Software is all about keeping track of expenses, but not everything is staying within your hotel. When handling hotel’s finances, it’s important to know what’s leaving the hotel. There are many cloud-based hotel accounting software solutions that will keep you informed on this.
- Striving for digital, paperless, and mobile experiences
Many hotels struggle with making the digital transition because of the costs and time involved. You can help your business navigate through this transition by using digital books; a cloud-based accounting software that offers small businesses digital books.
- Tracking all the different types of paperwork you have to deal with
Unlike other industries, hoteliers are required to have several kinds of documents in order to complete their tasks accurately. For example, you’ll deal with: invoices, purchase orders, payroll reports and many more other things. With cloud-based accounting software solutions, you can be sure that every document is being accounted for properly.
- Income statement and balance sheet management
Accounting practices differ significantly in the hospitality industry because businesses must calculate and monitor profitability on a regular basis to ensure that they’re staying profitable and paying taxes accordingly. Because of the complexity of this process and geographical dispersion of hoteliers, hotels need cloud-based accounting software that’s intuitively easy-to-use, but one that also has advanced features so that they can meet financial requirements.
- Increased regulatory compliance and reporting requirements
The hospitality industry is highly regulated, particularly with the implementation of the Sarbanes-Oxley Act in 2002 and the Health Insurance Portability and Accountability Act in 2010. These regulations are intended to protect investors from fraudulent financial reporting, but they can be burdensome for businesses that don’t have the proper resources or infrastructure.
- Tax management
Hoteliers must manage a relatively large number of taxes compared to other industries. Not only do they have to prepay sales tax on all incoming revenue, but they also have to pay occupancy taxes at both a state and local level plus miscellaneous taxes like parking fees etc.
- Managing customer transactions
Hotels are required to be able to provide customer statements at any time, and have a high volume of customer transactions that need to be tracked. For example, hotels may have thousands of different reservations with hundreds of different types of rates, as well as other product offerings like spa services. Managing all of this data is essential in helping businesses meet financial reporting requirements and stay compliant with regulations.
- Employee management
Hotel businesses typically have fairly low profit margins, so they rely heavily on their employees to help keep costs low while addressing customer needs. Cloud-based accounting solutions help the hotel accountants and managers simplify their accounting, auditing and reporting responsibilities, so unleash productive space to focus on guests.
The big players in the hospitality sector like Airbnb, Airbnb, Inc. and Greenhouse are already using cloud-based accounting software.
Hospitality professionals can also choose from the cloud-based accounting software from QuickBooks Online, but if you really need hotel specific look for something like Nimble Property. The hoteliers can run quick financial reports using it and close books without getting stuck with traditional accounts payable or accounts receivable systems. Unlike traditional cash management methods, you can use the spending alerts feature to track spending money in real-time.
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