FINANCIAL ACCOUNTING HOTEL AND CATERING INDUSTRY

(A CASE STUDY OF ZODIAC HOTAL LIMITED ENUGU)

By

ONWUKA EMILLIA .N.

Presented To

Department of Accountancy

ABSTRACT

Accounting is often said to be a language of business. It is used in business world to descries transactions entered into by all kinds of organization.

Accounting terms and ideal are therefore used by people associated with business, like managers owners, shareholder, bankers, hoteliers, lawyers accountants, and so on. As it is the language of business there are words and terms that mean one thing in accounting but whose meaning is completely different in ordinary language. Care caution and skill make meaning completely different when care, caution and skill have been achieved that person will gain insight into the way that business is transacted and the method by which business decisions are taken.

However, accounting extends from beyond the actual making of records, accounting is concerned with the use to whose records are put in their analysis and interpretation.

Regardless of the political system one lives on, one depends on the process of production, distribution exchange and consumption. Hotel industry is one of such activities. It is an establishment that provides lodging, food and other service for paying guests. It is very essential that guest must made comfortable at least to the extent of their resources. They should forget home, and enjoy coming back anytime they need arises.

The hotel industry is an important employer of labour outlets for the product of other recreation and entertainment. Hotels in many areas are important attraction for visitors who bring to them spending power and who tends to spend it a higher rate than they do when they are at home.

Yet there is doubt that in spite of its prime economic position, the industry lacks behind in business method generally and in accounting and control procedure in particular.

TABLE OF CONTENTS

Title page

Approval page

Dedication

Acknowledgement

Table of contents

List of table

List of table

List of figures

Abstract

CHAPTER ONE

1.0 Introduction

1.1 Background of the study

1.2 Statement of the problem

1.3 Purpose of the study

1.4 Research question

1.5 Significance of the study

1.6 Scope of study

1.7 Definition of terms

CHAPTER TWO

2.0 Review of related literature

2.1 nature of hotel operation

2.2 Principles and objectives of accounting system

2.3 Accounts classification and books of accounts

2.4 Accounting procedures

2.5 Data processing procedure

2.6 Reporting system

2.7 Internal control system

2.8 Accounting problem

2.9 Summary of related reviewed literature

CHAPTER THREE

3.0 Research methodology

3.1 research design

3.2 Area of the study

3.3 Population

3.4 Sample and sampling techniques

3.5 Instrumentation

3.6 Validity of the instrument

3.7 Reliability of the instrument

3.8 Method of data administration

3.9 Method of data analysis

CHAPTER FOUR

4.0 Data presentation and results

4.1 Summary of findings

CHAPTER FIVE

5.1 Discussion of results

5.2 Conclusion

5.3 Implication of the study

5.4 Recommendation

5.5 Suggestion of the study

5.6 Limitation of the study

REFERENCES

APPENDICES

LIST OF TABLES

TABLE 4.1: VARIABLE CLUSTER A

TABLE 4.2: VARIABLE CLUSTER B

TABLE 4.3 VARIABLE CLUSTER C

CHAPTER ONE

INTRODUCTION

1.1 BACKGROUND OF THE STUDY

In the modern society, people developed economic system to survive and thrive in an economic environment. In these systems, they produce goods and service, distribute income and exchange, and consume the output of the system (woefel 1980)

Regardless of the political system one lives on and depends on the

process of production, distributions, exchange and consumption.

Hotel industry is on of such activities. It is an establishment that provides loging, food and other service for paying guests. The industry is one that sustains travelers who had left their homes in search of leisure in the course of performing assignment or visiting relations or making business contest it is very essential therefore that guest must be made comfortable at least to the extent of their resources. They should forget home, take the hotel and enjoy coming back anytime the need arises.

Hotel industry is of many kinds: These are hotels, guesthouse, cafeteria, restaurants, detached bars and so on. The hotel industry is an important employer of labour outlets for the product of other industries, some of the amenities for local resident and foreign currency earners. It provided facilities of the conference for recreation and entertainment (med luck 1980).

Indeed, hotels in many areas are important attraction for visitors who bring to them spending power and also tend to spend it a higher rate then they do when they are at home. Thus from recent past, the industry has moved to a position of undisputed important to the national economy. Yet there is doubt that in spite of its prime economic position, the industry lacks behind in business method generally and in accounting and control procedure in particular.

Accounting is often said to be a language of business. It is used in business world to descried transactions entered into by all kinds of organization. As it is the language of business there are words and terms that means one thing accounting but whose meaning is completely different in ordinary language. Care, caution and skill make meaning completely different. When care, caution and skill have been achieved, that person will gain insight to the way that business is transacted and the method of business decisions are taken.

However, accounting is concerned with the use to whose records are put in their analysis and interpretation (Omuanya 1982).

An accountant should be interested in the relationship between the financial result and event, which have been created. He should study the various attentive opened to the firm and be using his accounting experience in order to aid management to select the best plan of action for the firm.

The owners, managers, investor and others needs accounting knowledge that they may read and understand financial statements issued by the firm and adjust their relationship with the firm accordingly.

Finally, practical and purpose oriented solution shall be provided towards reducing and eliminating accounting problem identified in hotel industry by use of accounting data generated form Zodiac Hotel limited and Modotel Hotel Enugu.

1.2 STATEMENT OF THE PROBLEMS

Financial accounting in hotel industries have been identified have

been identified with some problems.

1. The existence of poor service and accountability.

2. Lack of qualified accountants to handle the financial affairs of hotel.

3. Lack of study policy in hotel management. The internal system in hotel industries has witnessed a steady breakdown. These have been exorbitant charges in hotel.

It was in the identification of these problems that necessitated the carrying out of these researches so that causes and solution will be developed.

1.3 PURPOSE OF THE STUDY

The purpose of this work are as follows;

i. To find out the extent to which poor service and accountability affect the performance of Zodiac hotel Enugu.

ii. To find out of the extent to which lack of qualified accountants affect the affairs of the hotel.

iii. To determine how lack of study policy in hotel management affect the performance of Zodiac hotel Enugu.

1.4 RESEARCH QUESTION

Three research questions have been formulated to guide this study.

i. To what extent do poor service and accountability affect the performance of zodiac hotel Enugu.

ii. To what extent does lack of qualified personnel affect the progress of the Zodiac hotel Enugu?.

iii. To what extent does lack of training policy in hotel management affect the productivity of Zodiac hotel Enugu?

1.5 SIGNIFICANCE OF THE STUDY

This study is expected to help the hotel studies students and prospective investors, it will also fundamentally serves the following uses:

i. It would enlighten users on the process accounting

ii. The awareness of the people on the process of hotel accounting would broaden on the tenure of problems in hotel industries solution and prospects.

iii. It would serve as a ready companion and facts to researcher.

iv. The recommendation, if implemented would add to the growth of the industry through efficient management and accountability.

v. The scarcity of data in accounting system in hotel industry would be gradually reduced, as the research would be hardy to researchers.

1.6 SCOPE OF THE STUDY

This project is concerned with financial accounting in hotel industry

With a case of study of zodiac hotel limited, Enugu.

1.7 DEFINITION OF TERM

a) ACCOUNTING: One definition by Glamier (1976) defines accounting as the process of identifying, measuring and communicating economic information to permit informed judgment and decision by the users of he information.

b) ACCOUNTING SYSTEM: These are financial accounting system

and management accounting system. Financial accounting system mainly serves as the external users while the management accounting system is for the management decision and implementation.

c) INTERNAL CONTROL: According to Horgren (1982) internal control is " the set of accounting and administrative control and practices that help ensure the approval and appropriate decision are made in an organization".

d ) ACCOUNTING STANDARD: This is a communication of

accounting which consists of major standards of reporting.

e) FINAL ACCOUNTING: These are profit and loss accounts balance

sheet, sources ward application of funds statement values added statements, which the notes attached there in.

f) DEPRECIATION : This is the process of allocating cost of tangible assets over its estimated life in a rational and systematic manner.

g) MOTELS: These cater for transit motorists, but some emphasize resort trade and some have long-term guests.

h) RESORT HOTELS : This type of hotel provides private comfortable rooms, excellent cosine and a location with semi historic, recreational or therapeutics advantages.

i) CAFÉ: This is a place where pubic may buy and drink coffee beer, wine, sprits and so on.

j) ASSETS: These are the resources owned by a business enterprise expressed in monetary terms.