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Audit Procedures for Hotel Occupancy Tax

Revised 10/2004

Chapter 3 - Taxpayer Records

Introduction

This chapter explains the terminology and methods of record keeping most common to the hotel industry.


Registration Card

A guest registers his/her name and address on this card. The card will indicate the room number, room rate and date of registration. The card usually bears a folio number. An example of a Registration Card follows.

Registration Card

Guest Folio

In addition to the information on the registration card, the folio shows the itemized charges accrued by the guest by date and department. The serial (folio) number should correspond with that shown on the registration card. The guest folio may be arranged in various forms, such as:

  • Two separate copies (one for guest and hotel).
  • Original and carbon (one copy for the guest; the other for the hotel).
  • The guest folio and registration card may be arranged as one form, in duplicate (one copy for the guest; the other for the hotel).

An example of a Guest Folio follows.

Gracious International Inns

Room Revenue Balance Sheet

The Room Revenue Balance Sheet is prepared daily. This report records the room number, the occupant's last name and the number of occupants per room. An example of a Room Revenue Balance Sheet follows.


ROOM REVENUE BALANCE SHEET

                                                       TOTAL ROOM

DAY__________ DATE__________ LOCATION_________________ REVENUE $_______

                                                       CLERK___________
RM
NO		 NO
BR		 LAST
NAME		 S
O		 CK
O		 ROOM
REV		 RM
NO		 NO
BR		 LAST
NAME		 S
O		 CK
O		 ROOM
REV		 RM
NO		 NO
BR		 LAST
NAME		 S
O		 CK
O		 ROOM
REV
100



  
238



  
201



    
102





240





203





104





242





205





106





244





207





108





246





209





110





248





211





112





250





213





114





252





215





116





254





217





118





256





219





120





 





221





122





 





223





124





 





225





126





 





227





128





 





229





130





101





231





132





103





233





134





105





235





136





107





237





138





109





239





140





111





241





142





113





243





144





115





245





146





117





247





148





119





249





 





121





251





200





123





253





202





125





 





204





127





 
SUB-TOTAL

206





129 









     No.of Sgl._____________
     No.of Dbl._____________
     No.of Rms. Occ.________
     No.of Rms. Vac.________
     No.of Guests___________
208





131





210





133





212





135





214





137





216





139





218





141





220





143





222





145





224





147





226





149





228





 





230





 





232





 





234





 





236





 





 
SUB-TOTAL



 
SUB-TOTAL




Daily Control Report

This report is used to balance the total room sales. The key totals are usually printed on this report from the posting machine. The night auditor reconciles the report, and amounts in the adjustments column could indicate:

  • An entry error on the register
  • An adjustment for tax-exempt transactions
  • A sale rung up on an incorrect key

Daily Report

The night auditor of a hotel summarizes the total receipts for each day on a daily report. This report includes:

  • Room rentals
  • Banquet room rentals
  • Food sales
  • Beverage sales
  • Gift shop sales
  • Telephone charges
  • Vending machine sales
  • Other miscellaneous sales or services

The daily report may also include:

  • Room and food statistics, such as:
    • Number of rooms occupied - single
    • Number of rooms occupied - double
    • Number of complimentary rooms
    • Average daily rate
    • Number of breakfast, lunch and dinner covers
  • Sales tax payable.
  • Hotel Occupancy Tax payable.
  • Cash account and credit card accounts

Housekeeper's Report

This report is prepared the following morning on the basis of the maids' reports and inspection of the rooms by the housekeeper and her assistants. The information as to occupancy and baggage in the rooms is summarized on the report. The printed form of the report contains a list of all room numbers, with a small blank space after each to show the status of each room by means of symbols. In most cases the following symbols give sufficient information:

  • "/" means occupied, baggage in room.
  • "X" means occupied, no baggage.
  • "B" means baggage, room not occupied.
  • "O" means room out-of-order

"Occupied" refers to overnight occupancy and it means that someone slept in the room.


City Ledger

This is a record book showing the customers who will be billed directly by the hotel.


Monthly Summary

The hotel will summarize the information from the daily reports to a monthly summary. An example of a monthly summary that summarizes all receipts and a monthly room revenue sheet that summarizes only room receipts are shown. Also note on the room revenue sheet that there is a tax-exempt revenue breakdown.


Monthly Summary, Example


Monthly Summary, Example

Tax Report Room Revenue Sheet, Example


Tax Report Room Revenue Sheet, Example

Residential Hotel Record Keeping

A residential or semi-residential hotel may not need to keep daily records as they cater to a clientele that stays for long periods of time. The following two forms are usually found in the records of a residential hotel, but may be found in connection with a hotel that caters to overnight customers.

Deposit Agreement - A deposit agreement is usually required at a residential hotel. The deposit agreement normally will show the:

  • Date of occupancy
  • Date of notice
  • Date of vacancy

Deposit Agreement, Example


Deposit Agreement, Example

Monthly Summary Report

A residential hotel may not prepare daily room rental reports but instead prepare weekly or monthly room rental reports. The monthly summary report will show:

  • The unit number
  • The deposit amount
  • The check-in date
  • The occupant of the room
  • The period of payment
  • The base rate
  • Possibly the check-out date

Monthly Summary Report, Example


Monthly Summary Report, Example

Room Sale Accounting System

The steps involved in a typical room sale accounting system are as follows:

STEP 1
As the guest registers, a registration card is completed. Other departments of the hotel are immediately notified, and a notice of registration is placed in the room rack. The room rack is an index of all occupied vacant guest rooms. It is constructed in the same manner as a rack for time cards.

STEP 2
The night auditor of the hotel posts the following daily information to the customer's folio, usually after 12:00 midnight:

  • Room charge
  • Tax
  • Phone charges
  • Bar charges
  • Restaurant charges
  • Any other charges

After the daily charges are posted, the customer's folio will have the balance due as of that date.

STEP 3
After all daily charges have been posted, then the night auditor can obtain from the posting machine the total room charges, total tax, total phone call charges, total bar charges and the total restaurant charges for the day.

STEP 4
The night auditor will usually verify the correctness of the total room charges by the following computation.

  Room Sales for Proceeding Day                     $  840.00
  Add: Total Rate for new Arrivals                     450.00
       Total New Rate of Charges                        22.00
                                                    ---------
  Total                                             $1,312.00

  Deduct:    Total Rate of            $395.00
              Departures
             Total Old Rate
              of Charge                 28.00          423.00
  Balance:   Room Sales for           -------       ---------
              the Day                               $  889.00
                                                    =========

STEP 5
The night auditor prepares a room revenue balance sheet or a room control sheet.

STEP 6
The total room charges shown on the room revenue sheet are compared with the amounts shown on the daily control sheet.

STEP 7
The daily report is prepared from the information on the room revenue sheet and the daily control sheet.

STEP 8
The staff accountant verifies the night auditor's reports with the receipts; the accountant checks the room rack to determine if all rooms rented were reported.

The staff accountant may also check the housekeeping report to determine if all receipts taken were reported to examine the report for errors. (This is a good internal control measure.)

STEP 9
The Comptroller of the hotel will prepare monthly summary sheets from the daily reports.

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