What you should know about the Uniform System of Accounts for the Lodging Industry. Overview of the Blog Series - Part 1
Interpreting and Auditing Hotel Accounts in 2016 - and what you should know about the Uniform System of Accounts for the Lodging Industry.
Overview of the Blog Series
If you are an accountant, auditor, lawyer, banker, asset manager, real estate specialist and/or you have clients you are advising in the hotel industry then there are many things you should know more about and it is my aim to help you identify and clarify these in this series of articles.
If you have a current interest that requires interpretation of hotel accounts for 2015, then the provisions of the 11th Revised Edition of the Uniform System of Accounts (USALI) will be of considerable importance. Why ? Because this edition, published in mid-2014, requires adoption of its many details for accounts for periods commencing 1 January 2015 to be considered to be in conformity with the USALI.
The relevance of conformity with this standard is that many hotel operating agreements, franchises lease and financing definitions refer to accounts and definitions derived from the USALI. There have also been some changes to earlier editions that will impact comparisons with prior years and with financial reports.
In any event the existence of this industry standard for hotel operating accounts and its formats, definitions and terminology are things about which there is much of value to learn.
GAAP and IFRS aspects are common to all businesses for their financial reporting. An industry standard such as the USALI, widely in use within the global hotel industry, provides standards for operating accounts that enable management to monitor and benchmark their businesses internally and externally, using common terminology, allocations of revenues and costs, and formats of reports. How these relate to and can be reconciled with financial reporting will be covered in these articles.