Revealing the Ultimate Hotel Night Audit Checklist with a PDF

Debiprasad Sarangi -

Hotels operate 24 hours a day for seven days without taking any breaks. They require catering to different types of guests, preparing a summary of daily cash, optimizing occupancy, and checking credit card activities that occurred during the day at the front desk. Thus it is crucial to review regularly and verify the completeness and accuracy of guest and non-guest accounting records.

A hotel night audit is a crucial process for making sure your daily operations are running smoothly and your hotel business is right on track. Having a hotel night audit checklist can guarantee that all departments in the hotel are working in proper sync.

As a result, it helps in maintaining the thoroughness and reliability of front-office accounting. The most appropriate time for performing a night audit is either late night or early morning hours. So why is this considered a convenient time? It is because this is the only time when front auditors can perform night audits with zero interruption.

Why Night Audits are Important in Hotel Industry?

The night audit is more than just tracking charges and monitoring the credit activity of guests. It is an important function of a hotel which marks the end of a business day. The night audit process closes the business operation of the current day and rolls over the next date to start operations. You cannot perform check-in/check-outs without performing the night audit. It provides you a review of all the financial activities that take place in a hotel. On the basis of the review general managers can understand if their current marketing plans and operational activities had led them to accomplish their goal. 

Night audits also benefit daytime managers with the next day’s expected check-ins, check-outs and pending payments. Streamlining operations and ensuring the front desk effectively functions gets easier with these reports.It lets hoteliers monitor their expenses, rooms under maintenance, availability, booking vs no-show ratios. It eliminates redundant costs, thus keeping your financial health in check.

How Does a Successful Night Audit Look Like?

A successful night audit process strikes a perfect balance between guests and non-guests’ accounts.

  • Account consolidations are captured, and posted to guest accounts
  • Prepares billing invoices for guests who are checking out the next day
  • A smoother rollover to the next business day
  • Updates on the appropriate number of guest check-ins and check-outs of the next day
  • Makes you aware of financial discrepancies in the front office reports
  • Provide valuable insights into the revenue earned from guest spends, develop long-term strategies for promotions and pricing to attract and retain guests
  • Gives you easy and quick access to produce accurate reports
  • Generate reports on the expected check-ins and check-outs as well as pending payments for the next day.

Steps to Perform a Night Audit

Now that you have understood how a successful night audit is necessary to operate your front desk seamlessly, let’s focus on the hotel night audit checklist for running a successful and effective hotel operation. These steps remain the same for almost all types of accommodations.

Here is a mandatory hotel night audit checklist you need to keep handy w: 

1. Manage your Reservations

Review each reservation that has been made for the day. Make sure all transactions affecting guest and non-guest accounts have been posted to the appropriate folio before the day ends. Keep a proper record of total guest check-ins and check-outs along with no-shows. It is necessary to post all accounting data on the same day to avoid any kind of confusion taking place. Check if there is any room that is under maintenance and unavailable for booking. Make sure to note down all the discrepancies that you find like the occupancy of the room or the total length of the guest’s stay so you may reconcile them in your audit.

2. Adjust the Status of Your Rooms

Once you are done reviewing your daily reservations, your next steps will be to check the status of the rooms. As soon as you notice discrepancies in reservations, make sure to review housekeeping and occupancy reports for reconciling those differences. This difference will come useful when you require to add details on the night audit report regarding the occupied rooms for the next day. Housekeepers can use this information as well when cleaning and preparing rooms appropriately.

3. Review postings of Room Charges and Taxes

Review the guest registration records and reconcile it with the room reports to make sure the quoted and charged room rates match. If they do not match, make sure to confirm the discrepancy. Accurate room and tax charges are going to be posted to appropriate guest accounts. 

4. Balance Guest Charges and Payments

The hotel night audit process can get complex if any errors are discovered. It is advisable to first efficiently balance all departments and then look for errors in individual posting.  These charges can be from laundry, mini-bar, internet room service, telephone, internet, etc. This process is known as a trial balance. 

You must keep a proper tab on payments of corporate accounts (city ledger accounts). If you get any discrepancies between the trial balance and the actual, make sure that you keep a note of all differences and leave them for each department. Before you end it, make sure to close the cash drawer.

5. All transactions Must be Reconciled

Every transaction must be reconciled with source documents and it can be done in the following sections:

  •  Point of sale

Prepare a summary sheet of all sales that occurs at each point of sale along with a copy of the bills. The night auditor is going to reconcile checks and vouchers of individual point of sales with the point of sale cashier’s sales summary sheets.

  •  Guest account

Examine all financial transactions that occurred between the hotels and their guests. Reconcile the final transaction that took place between the hotel and its guests on things like visitors paid-out, food charges, discounts, etc.

6. Reconcile Room Status Discrepancies

Discrepancies in room status can result in a loss of revenue. The front office must maintain accurate room status to determine the total number of rooms that are available for booking. If it is not solved in time, it will cause a huge loss in business and create unnecessary confusion in the front office. There are cases when a housekeeping report suggests the room is vacant but the front office believes it otherwise. In such a scenario, the night auditor must look for an active room folio.

7. Generate Reports

The last hotel night audit checklist will be preparing necessary reports for general managers and other hotel staff members. There are hotels with a property management system [PMS] that can help you automate these reports. In this step, you will be able to finalize guest folios for any guests who are checking out the next day for streamlining check-out operations at the front desk. Generating these reports will strengthen your strategies around hotel operations.

Checklists of all the night audit reports to look into:

  • Night Audit Revenue report

The revenue report contains a breakdown of revenue that is generated for every room. It includes details like guest name, room number/type, room rate per night, meal plan, business source, texas and net earnings. Based on the report, you will be able to determine ARR for that day.

  • Night Audit   Occupancy & room status report

Hotels often deal with the issue of overbookings. Thus, to avoid it, it becomes necessary to check and evaluate the state of rooms, the cleanliness, and the occupancy reports to ensure making necessary changes during reservations. So, in case there are any problems with the state of the room or room availability, it is vital for them to come up with a solution plan from the night before. It is not professional for the front office to desperately try to figure out things in the presence of guests. Ruining their first impression is the worst thing you can do.

  •  Night Audit No-show report

Recording the no-show reservations enables us to take control of the reservations that did not show up. This helps the front desk include those rooms in the list of room availability. It also helps you to charge according to your reservation and cancellation policies.

  •  Night Audit Counter Report

The night audit counter report will collect details of each counter of the day. It will also show revenue earned and withdrawal by the counter on the particular day.  The View Counter Details checkbox will allow the hotel to track all the changes made in each counter before the night audit 

  • Night Audit Tax report

All state and tax charges get recorded for the current date, month and year. Such reports can help you check taxes per reservation at any moment, letting you minus the reservations that have not shown up or got canceled. As taxes are based on provided services, it is essential to check reservations regularly to ensure your tax report is completed properly. This Saves you time and also makes you aware of the tax charges per trimester.

  • MTD & YTD Report

It will show data on day wise, month wise and year wise for a selected day on which night audit has been performed. By default this report will show you data from the January  of the month. Hotels can also check data based on the financial year by selecting from Admin Console ⇒ General⇒ Default Settings ⇒ Financial Year.

  • Hotel Trial Balance Report

This report will capture the financial status of the property for a specific date which includes all the transactions that are posted and a breakdown of business within each of 3 Ledgers ( AR, Guest and Deposit)

The true purpose of hotel trial balance report is making sure that all the entries that are made into the general ledger of the organization are balanced properly. It shows the ending balance in each general ledger account. It is crucial to ensure the total amount of the debits and credits in each accounting entry matches perfectly.

8. Distribute Reports

The night auditor should promptly deliver necessary reports to authorized individuals due to the confidential and sensitive nature of front office information. This is the final step in the night audit routine and thus is crucial for running front office operations efficiently. Night audit reports must be accurately completed and delivered on time to make informed managerial decisions.

A visual understanding perhaps can help you get a better understanding of how night audits should be performed. I have shared a hotel night audit PDF below that will give you clarity on hotel night audits.

How to Simplify the Night Audit Process?

Right from cross-checking cash accounts to building proper communication bridges between departments, night audit does it all. It is a time-consuming and tedious process that comes with a high probability of errors. Hotelogix PMS will help you perform night audits at your preferred b time at night. It will ensure that all folios are settled, mark all the no-shows and flag discrepancies for action. It can help you perform night audits in just a few clicks.

You can do it in 2 different ways:

  1. On the top left of your PMS software, click on the drop-down button from the Frontdesk and then click on ‘perform Night Audit’. The system will complete performing the night audit in no time.
  2. In case you missed the night audit for the last business day, you will get a dialogue box from the Hotel PMS. All you need to do is click on the ‘Perform Night Audit” and the system will perform the night audit for you.

Hotelogix PMS can also automate the whole process for you. You will not even be required to log into your Hotelogix account. Based on the setup in the Admin Console. It will perform automatic check-in and check-outs and no-shows to the reservations. It will enable you to easily monitor and retain transaction history.

PARTING THOUGHTS,

Night audit is considered to be a significant part of a hotel operation and this is where every financial activity of guest’s accounts gets recorded and balanced. It helps you track the performance of hotel operations throughout the weeks, months or years. You can refer back to them whenever you need to reconcile anything. Hotelogix PMS is a boon to the hotel industry as it can help fix all data errors, send invoices or process refunds so you may balance all your accounts.