Within the hospitality industry, businesses are exposed to many areas where losses and frauds can occur. CHR Internal audits are designed to check that systems and controls are in place to minimise such occurrences, and that they are operating efficiently.
What areas of the hotel are checked in an Internal Audit?
- daily sales, allowances, cash and credit transactions, including pricing and commissions
- purchasing, ordering receiving, issue and consumption of goods and services
- payroll and labour costs, including tronc operation and employment regulations
- review of controls for administration and overhead costs
- capital expenditure controls
- reliability of the management and financial reporting systems.
Further aspects could include:
- compliance with commercial contracts
- tax compliance
- legal, banking, landlord and other related compliance
- computer systems controls including IT security.
How is an internal audit carried out?
The scope of the internal audit programme, method of reporting and cost budget will be agreed with the client and, if required, in conjunction with the client’s external accountants or auditors.
To ensure the integrity of the audit, CHR Hospitality audit will be carried out by team members with relevant expertise who are independent from those managing the client’s accounting services.
The internal auditors will need access to all relevant departmental systems and records in the hotel – and will have reviewed relevant records maintained by CHR Hospitality’s accounting services team.
A basic audit visit to a hotel where CHR Hospitality carry out the routine accounting services would take place over two days, with a written report presented within a short period after the visit. Depending on the client’s wishes, a verbal report and management’s responses can form part of the hotel visit programme.