Deck 13: The Night Audit

Question 1

Room sales are always accounts receivable sales, whereas sales in the dining room could be accounts receivable sales, cash sales or credit-card sales.

Answer 1

True

Question 2

A hotel system may have some departments charge guests using manual (pencil-and-paper) vouchers even while the balance of the hotel operates with a computerized property management system.

Answer 2

True

Question 3

The night audit reconciles the hotel's accounts receivable nightly whereas most other business types do that monthly or even less frequently.

Answer 3

True

Question 4

Several court cases are now pending because the night audit, which ends the hotel's accounting day, conflicts with its legal definition: A hotel is required to be open 24-7-365.

Question 5

The Hospitality Information Technology Integration System (HITIS) encourages vendors to build systems that interface with other manufacturers and urges hotels to support those efforts by buying products that meets HITIS standards.

Question 6

Late charges are reduced dramatically when POS terminals are used in the dining room because they:

A) Identify guests who have already checked out, preventing new charges from being made.
B) Record charges instantaneously rather than waiting for a runner to take the voucher to the desk
C) Flag paid-in-advance guests who are not permitted to charge
D) Alert cashiers to balances that exceed allowable credit limits
E) All of the above

Question 7

Charges for room and tax are posted by the night auditor except charges or fees for:

A) Day rate use
B) Use rate use
C) Late check out
D) Failure to stay through the reservation commitment
E) All of the above

Question 8

An "Allowance Report"is an example of a (an):

A) Reservation Report
B) Exception Report
C) Registration Report
D) Room Status Report
E) None of the above

Question 9

Which of the following class of reports would be the most helpful to the yield manager for forecasting and setting rates?

A) Exception reports
B) Reservation reports
C) Credit reports
D) Downtime reports
E) Both A and D

Question 10

The Daily Report to the Manager:

A) Has limited value because it reports cash sales only
B) Is just another name for The Night Auditor's Report to the Manager
C) Is prepared by the Income Auditor
D) Becomes the basis for entries into hotel's journals
E) Both C and D

Question 11

List 3 reports within any one class of reports. For example, one item under Exception Reports might be: A Comp Report. (Note: Your response may not use "Comp Report,"because it was shown in the question itself.)

Question 12

Charges and debits are interchangeable accounting terms.

Question 13

The night audit closes the hotel's day, which the American Hotel & Lodging Association (AH&LA) has set at 1 AM, although exceptions are allowed upon petition.

Question 14

Pencil-and-paper night audits spend a great deal of time and energy uncovering errors caused by the very pencil-and-paper system.

Question 15

Night auditor jobs are hard to fill because most of the U.S. states require that person to be a certified public accountant, CPA.

Question 16

Many non-accounting duties face the night auditor when he or she is the sole employee on duty during the late-night and early-morning hours.

Question 17

The night audit has grown less important in modern hotels because most guests now pay with credit cards rather than cash.

Question 18

"Account Receivable"is an accounting way of saying, "that guy owes us money."

Question 19

The night audit audits all types of sales - cash sales; sales on account; sales throughout the hotel for rooms, food, bars, spas, etc.

Question 20

The Daily Report to the Manager, which is prepared by the income or day auditor, is a more inclusive report than the Night Auditor's Report to the Manager.

Question 21

The night audit reconciles the hotel's accounts receivable nightly whereas most other business types do that monthly or even less frequently.

Question 22

City-ledger receivables must be audited more frequently and more promptly than an audit for transient receivables.

Question 23

Writing $53.21 as $35.21 is called a transposition; writing $53.21 as $532.10 is called a slide.

Question 24

The closing balance of each day is the same as the opening balance of the following day; whether the count is cans of peas, bottles of scotch or accounts receivable.

Question 25

If the night audit is to relied upon, only the night auditor should be permitted to post room charges and taxes.

Question 26

Simply put: The night audit proves that all cash sales by registered guests have been recorded and the guest folio properly charged.

Question 27

Management should contact the room - enter it if necessary - if the "Do-Not-Disturb"sign remains there throughout the day.

Question 28

A "Reverse Housekeeper's Report"goes from the linen room to the floor housekeepers rather than the traditional route of the floor housekeepers to the linen room.

Question 29

Uncovering errors is not the real purpose of the night audit; correcting records is.

Question 30

"The total equals the sum of the parts"means that the total income charged to individual account-receivable folios should equal the total of charged sales recorded for that particular department.

Question 31

Both wage-and-hour regulations and union contracts prevent night auditors from remaining beyond their work hours even if they have failed to balance within the shift.

Question 32

Night auditors can do their jobs even if they do not understand the accounting difference between a debit and a credit.

Question 33

If a PMS crashes, at say, 8:00 am, it is not possible to accurately check out a guest, at say, 8:15 am.

Question 34

POS terminals electronically connect the various departments to the PMS, except for telephone calls, which must still be manually posted to the folio.

Question 35

One would expect an Arrivals Report to help the bell-service department.

Question 36

Many computer-prepared reports are "dumped"24 hours after they were printed.

Question 37

Both pencil-and-paper audits and electronic audits use similar, sometimes identical, departmental control sheets.

Question 38

As their title suggests, "Exception Reports"are not usually prepared during the night audit; they are exceptions prepared only when management seeks special information.

Question 39

By using "turnkey"installations, the hotel industry has slowed innovation and stalled the development of new uses for Property Management Systems.

Question 40

"Today's opening balance must equal yesterday's closing balance"is an issue for pencil-and-paper audits but is not a factor for electronic audits.

Question 41

To speed check-outs, folios of departing guests may be placed under the guest-room door, even if the hotel offers in-room television access.

Question 42

Property Management Systems capture a great deal of information that can then be arranged and reordered in a variety of reports.

Question 43

An "on-change"report indicates which guest rooms are undergoing renovation and when they will be ready for sale again.

Question 44

The night auditor reconciles only account-receivable sales.

Question 45

Property Management Systems require unit managers to wait for nightly reports rather than having the data for operational decisions throughout the day.

Question 46

Restaurant POS terminals reduce bad debts by rejecting invalid meal checks from guests who have already checked out and/or paid in advance.

Question 47

We're not there yet, but a computerized system might eventually display information such as the number and identity of vacant king rooms.

Question 48

"Downtime Reports"are used whenever the night audit crew takes a break for rest or meals.

Question 49

The Night Auditor's Report to the Manager contains a running (cumulative) balance of accounts receivable at the desk, cans of peas in the storeroom and bottles of scotch at the bar.

Question 50

Information on the Night Auditor's Report may be changed as a result of the income auditor's work.

Question 51

Having a credit manager on duty is more important to the operation of a highway motor inn than for an upscale, four-star hotel.

Question 52

Two ratios, the Percentage of Occupancy (%) and the Average Daily Rate (ADR), are among the statistics included on the Night Auditor's Report to the Manager.

Question 53

A Room Status Report shows rooms occupied, vacant, out-of-order and on-change for a particular day although it is prepared as part of the night audit.

Question 54

A well designed credit-limit report would list the outstanding balance of every folio so the credit manager could see how close to the limit was any particular balance (folio).

Question 55

Yield Management depends on current and accurate information about reservations, the very information provided by the Reservation Reports of a PMS.

Question 56

Which of the following symbols is (are) used in the Housekeeper's Report?

A) B: Baggage in the room, no occupant
B) NB: Baggage in the room appears to be worthless
C) S: No baggage in the room; appears to be a Skipper
D) PA: No baggage in the room; Paid in advance
E) All of the above are used to make the report complete

Question 57

Too early a closeout hour:

A) Throws many charges onto the following day's folio and audit
B) Probably increases the number of skippers
C) Will likely reduce sales in cocktail lounges and room service
D) Puts serious time pressure on the night auditor to finish
E) All of the above, except B

Question 58

PMS are changing dramatically as hotels:

A) Use a Window environment
B) Adopted and implemented HITIS
C) Install more and more dedicated software
D) Access the World Wide Web
E) All of the above except C

Question 59

Organizationally, the night auditor is most likely to be a member of the:

A) Front-office staff
B) Accounting department
C) Legal division
D) Manager's personal advisory group
E) None of the above

Question 60

Night auditors prepare:

A) Long-distance telephone records
B) Cash overages and shortages
C) Reports
D) Bank deposits
E) All of the above

Question 61

Which of the following does NOT belong in the set?

A) VIP check out
B) No-wait check out
C) Zip-out check out
D) Speedy check out
E) None of the above; they are the same process with different names

Question 62

Which of the following is NOT done electronically by a Property Management System?

A) Posting room charges
B) Reconciling discrepancies between the Housekeeper's Report and the desk
C) Addition and subtraction
D) Preparing reports
E) None of the above; that is, the PMS does all of these

Question 63

An "Allowance Report"is an example of a (an):

A) Registration Report
B) Room Status Report
C) Reservation Report
D) Exception Report
E) None of the above

Question 64

Which of the following reports would be of the most help for management involved in planning new room additions to the hotel?

A) A Reservation Report; a Daily Analysis Report, for example
B) A Credit Report; a Cumulative Charge Report, for example
C) An Exception Report; a Skipper Report, for example
D) A Rooms Management Report; Rooms Out Of Order, for example
E) Both B and D

Question 65

Night auditors prepare both dollar denominated and non-dollar reports; an example of the second type includes:

A) Tomorrow's departure list
B) Reverse housekeeper's report
C) Front-office log
D) Tomorrow's arrival list
E) All of these

Question 66

There are sales that may not appear within the night audit, such as:

A) Banquet sales posted directly to the city ledger
B) Registered guests buying F&B services for cash
C) Nonregistered guests buying F&B services with credit cards
D) Registered guests buying F&B services with credit cards
E) All of the above