1. STANDARD OPERATING PROCEDURE
Memorandum----STANDARD OPERATING PROCEDURE Hotel Accounting
System-3
Subject --DISCOUNTS and ALLOWANCES OFFERED TO
CUSTOMERS --
DATE –12-6-2007
DISTRIBUTION ---General Manager, Financial controller, Front Office Manager,
IT –Manager, Reservation s Manager Director General Accounts, Chief Accountant
Account’s department and all department heads
OBJECTIVES
The hotel business is service oriented it satisfies the customer to make his stay a
memorable and pleasurable one , it meets the necessities of the guest to the type of food
of his palate and encourages the guest to maximize the guest satisfaction with out any
Hindrances to the comforts and benefits he derives ,As a policy to enunciate promotions
in the business structure , hotels come out with a policy on discounts and allowances
And here we have analyzed and whetted a policy on discounts and allowances allowed to
guests
Policy statement--- In order to promote the sales of the company by identifying the
market segments which are seasonal a flexible pricing policy with a discount
/allowances structure is framed for the penetrating the sales of the company ,
market research analysts would use this tool in its sales promotion strategy
Definitions
Guest –is a person who is permitted to stay at the hotel for a period of time to enjoy the
hotel guest facilitations without hindrance to other guests both with a room and a
restaurant facility
Discount and allowances –Are a reduction in the basic price , they modify the listed
prices of any product or service for sales , for the hotel the rooms and allied services like
laundry telephone ,have listed prices but due to sales and marketing strategy a the prices
are reduced to achieve the targeted sales ,to enable the travel agent to have a marketing
resource during low seasons prices are discounted , the cost of guest facilitations are
allowanced
Cash discounts are offered for immediate settlement of bills in lieu of credit terms
Discounts relevant to our hotel –discounts appear as promotions for instance loyalty cards

2. We have the 02 piece laundry allowance per day for executive guest rooms are
allowanced to guest as a package promotion
The staff discounts in restaurants are all motivational discount policy
Discounts allowances procedures
How are the discounts defrayed –The internal communication system records the
schemes of the discount with well laid out procedure
Any discount granted, issued or paid should have an authority for the discount
Discount for which purpose paid and the reasons for payments is analyzed , it also
specifies the quantity of discount paid /allowanced off .
There is a separate policy and procedure laid down for each revenue discounted or
allowanced
The above discounts usually concerns the guest mainly by way of promotions and to staff
as incentives
Accounting discounts are those which are passed to due errors or nulling any error in
making the bills due to the negligence of the employees , as today computer are in use a
wrong entry in the sales can be nulled , by passing a discount entry
AUTHORISATIONS OF DISCOUNTS
The discounts are authorized by an authority normally at the departmental head level,
normally a discount or allowance is allowed at a senior supervisory level who is available
at any given point of time
The discount structure has an approval from the top management level-
For windor plaza hotel the chairman of the company approves ratifies and delegates for
delegation
The schemes of the discounts allowances are written down by the General Manager
agreed upon by his team and approved /ratified by the chairman of the company
Accountabilty of discounts
Any discount allowed or allowance passed should have proper documentation to
substantiate the discounts /allowances accounting treatment
The Accounts department would have a control on the discounts and allowances allowed
every day, the night auditor would summarize the discount made, the reasons attributed
And in case loyalty cards proof of the card holder, like his card number recorded, the
amount of discount allowed the copy or the embossment of the loyalty card . etc he
would frame a report manually and submit a copy to the department head , financial
controller and the general manager , after the documents signed it would be put on file , if
the computer package enables a discount report it would be pulled out of the computer
and put in use. Such discounts are verified and filed as document for inspection ,any time.

3. In case of discounts arising out of Guests Disagreeing with the Usage of any facility or
any food menu inconsistent with his taste , or use of a facility , such discounts are written
off the revenue , but justification should be made by the level of authority for allowing
the Discount or Allowance , the amounts discounted or allowanced should be in
proportions to the total amount of the bill.
Specific issues in the computation of laundry discounts at present on promotions to sale
of room in the executive floor , these discounts can be accounted as guest complimentary
in the bills , because usual audit norms are revenue earned should not be revenue
reduced with discounts.
Discount authorizations ---whenever a staff discount is offered the bill should have the
signature of the staff to whom the discount is offered, the cashier should ensure that on
all staff discount bills the concerned staff should sign the bills signed , In case of any
difficulty in getting their signatures the restaurant Manager, supervisor should be
informed of the same and with his assistance or instruction settle the bill.
For individual discount schemes like a Discount on promotion or allowances, the
concerned department, if it is sales and marketing, Food and Beverage, front office or
from any selling utilities a Standard operating procedure is made and distributed to all
department and all the concerned staff in the departmental meeting, as to show the
guidance to staff how the scheme operates, because they are END USER operators of the
scheme
The discount authorizations can be delegated by the department head for immediate
sanctions even to supervisor levels but should be ratified by the Departmental heads
And ultimately by the General Manager and the Financial controller.
All the discounts and policy and procedures will abide by the tax laws and other laws of
Vietnam , and should be binding to Audit norms and financial control
APPROVED BY ISSUED BY
General Manager Financial Controller
Mr. Gerhard Felgenhauer S.Jayakumar
Vice General Director

4. Tram Thich Ton