Increase the Value of Your Hotels Financial Statements
Most hotel teams we talk to like the idea of helpful financial statements, but they are frustrated that their team doesn’t seem to care.
The financials are late, items are coded all over the place, and questions aren’t answered.
But it’s not because the team doesn’t care!
It’s often just because they aren’t given a set schedule for financial reviews and their time is filled with other important tasks.
This week we’re talking about end of month reviews!
A simple review schedule will help your team get involved in cleaning up the Income Statement. Now... it isn’t real if it isn’t ACTUALLY ON the calendar, and that is where many get held back!
It’s human nature to work harder if you know your work is being reviewed.
A monthly P&L review call between the hotel managers and owners/management company to review the hotel’s performance and go over questions is a KEY element in our highest performing clients.
Set a monthly recurring meeting for this!
Put it on the calendar now to make sure it happens!
Before these meetings, hotel managers should already have reviewed the activity for the month and requested any reclasses or accruals that they need the accountant to make.
Now I initially thought those calls only impacted the hotel teams involvement in making end of month reclasses and answering questions about what already took place...which is a very traditional and narrow view of accounting... That it’s just about recording what already happened.
But I’ve recently realized that when hotel managers are involved in the accounting process and answering questions about their performance each month based on the Income Statement, it actually effects many different aspects of their behavior!
Hotel managers who are held accountable to a monthly financial review process:
- Seem to hold more pride in their position. They feel like a trusted part of the leadership in the company.
- Navigating in the accounting system becomes second nature, so they are able to answer vendor questions easily and those relationships flourish.
- They are part of the reclass process monthly, so they help train the AP team on coding to make their own end of month process more efficient.
- They are mindful of their spending throughout the month because they know those review calls are coming.
- When out of the ordinary things happen throughout the month, they are better documented because the manager knows it will come up on the call.
It plays out in all sorts of ways, from how they carry themselves, to how they interact with their team!
We all want to be valued and we all want to contribute to the mission.
Implementing P&L reviews and holding managers accountable to the Income Statement might be scary or intimidating at first, but in not much time at all, it will help the team THRIVE!
So your tip for the week is to schedule monthly P&L review calls so that everyone on the team is bottom line focused!
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