What Information Is Found in a Hotel Financial Report?
A hotel financial report is a document that lists information about the income and spending of the hotel over the last fiscal period. Since these reports are generally issued annually, they are also known as annual reports as well as financial statements or account statements. These reports are often issued to shareholders and are very common in publicly-owned hotels; private hotels may publish a hotel financial report, but they often see less circulation. The overall content of the report varies based on several factors, but most of them have a detailed breakdown of income and expenses as compared to previous years.
The average hotel financial report can be broken down into four or five main parts. Publicly available reports will have a section that basically reads as an advertisement for the hotel. It will say how wonderful everything is and downplay any negative aspects of the previous year. These sections will typically have small facts, such as how many guests stayed in the hotel over the year, but these facts are typically more for entertainment than business purposes. A private hotel financial report will often omit this section.
The Statement of Financial Position is generally the first important part of the report. This section is a thumbnail that shows the basics of the hotel’s financial situation. It summarizes assets, debts, dividends and so on. These figures are generally placed next to figures from previous years. This allows readers to see if an overall trend is devolving.
The next common part of a hotel financial report is the Statement of Comprehensive Income, often referred to as a Profit and Loss Statement. In many ways, this is the same information in the Statement of Financial Position; it is just much more detailed. Where the summary just shows a number, this section breaks that number down into its constituent parts. This shows exactly where money is entering and leaving the hotel.
A Statement in Changes of Equity comes next. This portion talks directly about ownership equity in the hotel and what caused it to go up or down over the period. This is the section that often explains why shareholders made or lost money with the hotel over the year. This section will usually give the final dividend value for stock payouts.
The last section is the Statement of Cash Flows. This portion of the hotel financial report talks about money spent internally with the hotel. If money or assets were shuffled around based on need within the organization, this section will show when and why. This part of the financial statement also breaks down any internal reorganizations that may have occurred, which had no overall impact on profits or losses.
In my opinion, not really. The information included in most financial reports falls into two areas: ads and corporate information. Ads are everywhere so most people don't need any more and the corporate info is usually not applicable to the average guest.
@Mme Sasha - Unless you want to go into the hotel business, I can't think of a reason to read the reports. The only exception might be if they were about to go out of business, and you might get bad service at that point.
Would there be a good reason for a hotel guest to read the hotel financial reports before staying there?
Post your comments