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Hospitality Compensation – Controller Departments

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This is a highly specialized position, and most accountants reach it only after many years of experience, preferably in the hotel business. The controller or chief accountant, as this person is called in some hotels not only heads the operation of the accounting department but is also closely affiliated with the operation and executive management. Many hotel owners and operators consider hotel accounting a highly specialized field and accordingly will entrust the affairs of their hotels only to accountants with considerable hotel experience. They believe that service operations and time-and-cost accounting are so different from other businesses that only a hotel accountant can successfully do the job. According to the Hospitality Compensation Exchange 1998 Lodging Property Annual Report, controllers can expect to earn from $40,100 to $82,118 per year, depending on the size of the facility.

If you plan a career in hotel accounting, specialize while at school in accounting before entering hotel work. Then, at least, you will have the requirements for a controllership. Working your way up is the next step.


The auditor and the members of the auditing staff examine the accounts of the hotel and analyze them for the controller and manager. They check to make certain that all entries have been properly made; they look for errors. In general, they make a complete check of all monies of the hotel, all records, all accounts receivable and payable, and other matters of importance to the hotel's financial welfare.

Auditing positions require experience and education similar to that of the controller. As with the controller, promotion to auditor comes after many years of hotel experience. From auditor, the next step up is promotion to controller.

Accounts Payable

The accounts payable section is responsible for checking bills presented against shipping invoices and receipts. Upon finding that they check, this department then authorizes payment. In some hotels, accounts payable may draw checks and even have authority to sign and issue them.

A high school education is the minimum requirement for positions in accounts payable. Accounting, bookkeeping, and other business training are also required in many hotels. There are, however, openings here for beginners as clerks. These are filled mostly by young men and women who have completed high school.

Promotion from accounts payable to the auditing staff is possible if you possess the proper education and business training. A college degree is highly desirable. Promotion is also possible to the credit, front office, and purchasing departments. From here too, you can go up the ladder to manager ship.

Accounts Receivable

The accounts receivable section lists payments and keeps records of all money received. All room, restaurant, and other charges are noted on records kept by this section. Payments made by guests against these charges are also recorded here.

The systems employed by accounts receivable departments differ from one hotel to the next. In some hotels, cashiers keep ledgers and do their own postings. In some hotels, all charge slips are forwarded to the accounts receivable department where entries are made. The system will vary, depending upon the size of the hotel and the system set up by the controller and auditor.

Opportunities for positions here correspond with those in accounts payable, and educational and training requirements are the same. Promotions possible in the accounts payable department are also possible in the accounts receivable department.

Payroll Department

Payment of all wages and salaries, maintenance of payroll records, the issuance of payroll checks, and the coordination of the payroll disbursements against wage and hour scales are the responsibility of the payroll department.

This department is headed by a paymaster, and promotion to this position is generally from accounting and credit departments, although some hotels may employ paymasters with experience in other hotels or businesses.
Assisting the paymaster is:
  • payroll clerks, who make up and issue paychecks, compute wage and hour scales, keep records, check timekeeper reports, and perform other functions of the paymaster

  • payroll cashiers, who issue checks to employees

  • payroll conciliation clerks, who check the payroll bank account regularly to make certain that there is sufficient cash on deposit to meet all payroll accounts

  • miscellaneous clerks
Educational and training requirements are general and somewhat similar to those of accounts payable and receivable. Studies in accounting, bookkeeping, statistics, hour and wage computation, personnel, and other affiliated courses are recommended.

Beginners are employed in this department since many functions are clerical. There are many opportunities for advancement, and considerable experience can be gained here.

Other Opportunities in Accounting

There are opportunities for employment in the accounting department other than those just described. Depending upon the size of the hotel, certain other duties and functions fall under the supervision of the controller or accounting department. The scope of the accounting department's job responsibilities varies from one hotel to the next.

Large hotels usually maintain statistical departments that correlate pertinent data helpful for the future operation of the hotel. The statistical department records such data as these:
  1. Registrations to ascertain where guests come from, the percentages of the geographical derivation of business, and other geographical data.

  2. Food and liquor purchases by brand, dish, age of customer, or other breakdowns deemed important by management.

  3. Age group and gender of guests.

  4. Returns from advertising and promotion campaigns.

  5. Time study and payroll information.
This information is put to use by the purchasing department, the chef, the front office, advertising, sales and sales promotion, public relations, and other executive offices.

In many hotels, room and restaurant cashiers are supervised by the accounting department. Their duties are directed by the house treasurer or chief cashier. Cashiers perform all the duties their title implies. They receive payments, post charges, make change, and keep daily records.

Food control and purchasing control are, in some hotels, maintained by the accounting department; in other hotels they are part of the chef-steward's department or purchasing department. In large hotels, both of these departments, as well as the accounting department, may employ control and checking personnel who double-check and correlate each other's figures. Ultimately, all purchasing and chef-steward accounts are checked by the accounting department for errors and to make certain all records have been properly entered.

Hours of employment in the accounting department are generally eight hours a day, five or six days a week. Conditions of employment here are similar to regular office work.

Accounting work gives one an excellent background in hotel management and operation. The supervision of financial problems is an important function, and the controller of the hotel probably is more informed about its costs, problems, and other operations than any other person in the hotel. Every financial transaction passes before this person. Many a controller has become manager of a hotel. It is a logical promotion.

Educational requirements are high for employment here and particularly for advancement. A high school education, at least, is required for top positions. While there are openings as clerks available to beginners, most employees are required to have some form of bookkeeping or accounting background.

Median earnings of full-time accounting, bookkeeping, and auditing clerks (1996, Bureau of Labor Statistics) were $20,700, depending on the job and its responsibilities. Payroll clerks averaged $23,100 a year. Jobs further up the ladder vary greatly in remuneration as there are many factors to be taken into consideration that are not common to all hotels. The rate of income will depend on the size of the department, hotel, and city; the responsibilities; the volume of business; and the kind of system set up by the controller. In general, earnings here are as good as, if not higher than, in most hotel departments. Sometimes meals are provided for managers or other members of the department.

The Credit Department

The credit department is responsible for authorizing charges made by guests, issuing credit cards, investigating the credit status of guests requesting credit cards, notifying guests of the acceptance or rejection of their credit applications, making adjustments on statements when incorrect charges have been posted, and keeping records and files of all credit transactions. Credit departments determine the credit limit of guests in most hotels, and indicate this on credit cards by key letters or numerals. Credit department people are required to follow up on delinquent accounts by writing letters or using other methods.

A credit manager heads this department, and the main functions are performed by assistants. Promotion to credit manager is usually from assistantships in the credit department. The position carries a great deal of responsibility with it, and candidates are very carefully considered. Seldom will an outsider without hotel experience be brought in. Hotels are frequently judged in hotel circles by the reliability of their credit methods and judgments. Certain hotels and chains have credit departments with such good reputations that credit cards they have issued are accepted by many other hotels as proof of good credit standing. Other credit cards are checked and approved for clearance.

In some of the larger hotels, the work of the assistant credit manager is aided by credit investigators. It is their duty to check accounts where credit has been overextended, investigate fraud, and, in general, oversee credit operations to prevent any criminal action against the hotel.

The credit department supervises operation of a guest history section for the sales department in some hotels. This section records the special requests and particular likes of guests. This information is cross-filed so that these special desires can be noted instantly against reservation or registration cards. A guest history might include such information as this: one guest asks for an extra-long bed; one guest likes four pillows; another guest always insists on southern exposure; one guest does not want to be higher than five floors above street level. The history also includes other pertinent information, such as the number of stays per year of each guest, the time of the year he or she checks in, and so on. This information helps the sales department decide whom to favor in peak periods. To aid credit people in their work, the guest history section may also keep in this cross-file names of delinquent accounts and bad credit risks so that their arrivals or reservations are noted instantly by the credit department and preventive action can be taken.

Work hours in the credit department are based on the three-shift system. In large hotels, there is always someone on night duty. In the small hotels, the functions of this department are assumed by the general cashier or the owner-manager.

At least a high school education, and preferably college, is required in this department. Since there is much responsibility placed on the members of the credit office, most hotels are generally unwilling to employ people for credit work who have had no experience or education. When openings occur here, other employees of the hotel are considered, with education and background being important factors. From credit, promotions are made to front office or managerial staff.

Starting salaries in the credit department are about the same as in general accounting, depending on the size of the hotel and other factors. Regular increases augment the earnings here, and in some hotels, meals are provided managers and assistant managers of the credit departments.
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