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INTRODUCTION

Hospitality industry is mainly associated with the activities or function related to providing high quality and luxury services to customers. Main motive of organisations operating in hospitality industry is to provide customer satisfaction by applying improvement and innovation in services. As all industries are regulated by relevant authorities, this industry is also governed and administrated by government through regulations and it is necessary for organisation to follow these rules and regulations (Ervin, 2016). In order to understand various aspects of hospitality industry, in this report a newly formed restaurant Royale Restaurant is being opened in Bishops gate, London; is taken. Which is specialised in inventive, health salads and juices and smoothies. This report also describes  performance management plan, specific legislations, link between different functions and roles within hospitality sector and ways of communication, ordination and monitoring within departments of an organisation.

TASK 1

1. Principles of managing and monitoring financial performance:

Principles refers to guidelines to conduct any activity or imp0rove the activities or functions. Financial performance refers to efficiencies and abilities to accomplish any task or activity in order to achieve their objectives and goals. In this context following are the principles of managing and monitoring financial performance of Royale Restaurant, as follows:    

  • Composition of finance:It is very vital for Royale to structure their finance sources and to achieve appropriate composition of finance because sources of funding and finance are directly linked with an organisation's performance. Excessive financing through debts may reduce financial performance so in order to manage and monitor financial performance systematic composition of finance is act as principle (Gnanapala, 2017).  
  • Manage expenditure and optimise costs:Financial performance mainly concerned with profitability condition of an entity and to achieve profitability systematic management of expenditure and optimisation of various costs though techniques like budget and cost analysis is required. So for Royale being a newly formed company minimising their cost is required to survive in initial period.
  • Identification of risky factors: In order to achieve stable growth in identification of potential and existing risk factors that can affect organisation's financial performance adversely, is necessary. Royale should identify such factors to avoid any difficulty in future.

In order to manage and monitor financial performance these principles assist Royale and ensures future sustainable growth.

  1. During an accounting period incomes and expenditures of business organisation are as follows:

Incomings

Outgoings

Benefits

Drinks

Allowances

Lunch purchases

Wages

Household utility bills

Gifts

Weekly food shopping

 

Clothes

 

Gifts

  1. Explanation of some specific terms:

Types of cost: In day to day working, an organisation incurs different different costs and expenditure which are necessary to operate business functions and activities. These costs helps to determine profitability and performance of organisation (Charterina and Barrutia, 2014). These are the major costs in Royale Restaurant related to its different operations as follows:

  • Variable cost:A variable cost refers to those expenses that fluctuate in proportion to number of output or costumers as the case may be. This costs are increase or decrease as per change in level of output or scale of operations. It includes beverages, sales commissions,utility costs etc.
  • Fixed cost:These type of costs includes those expenses that does not fluctuate with the number of customers served or numbers of food items offered by Royale such as Adversing expenses, fixed administration cost, premises rent, depreciation etc.
  • Semi variable cost:These are those cost which are fixed for a set level of or consumption in Royale and become variable after an extent.

Sales: Sales refers to total amount of revenue and income earned by business organisation during a particular period. In Royale monies received by serving customers or delivering foods through online sites are considered as total revenue and income. Sales also includes item as other income which includes other ancillary incomes.   

Purchase: It includes amount paid by a business organisation to purchase raw material or other items to operate its main activity. In Royale money spent towards purchase of raw food items by organisation to prepare food and beverages are considered as purchase.    

2. Application of double entry book keeping system of debits and credits and Analysis of sales and purchase transactions to compile trial balance:

Double entry book keeping system: As per this system of accounting transactions are recorded in way that every entry affects two accounts simultaneously. Every organisation like Royale Restaurant adopts double entry system to record their transactions and for better reporting. This is a Trial balance based on double entry system:

 

Particulars

Debit

Credit

Cash in hand (Negative Figure)

 

10700

Petty cash expenses

750

 

Cash sales

 

3350

Credit card sales

 

14795

Free issues

575

 

New kitchen equipments

6540

 

Food purchase

7900

 

Beverage purchases

12970

 

Purchase return

 

200

Discount received

 

2300

Credit notes

 

190

Rent

2850

 

Utilities

475

 

Functions and events (Income)

 

5967

Wages

4590

 

Debtors

700

 

Till shortage

152

 

Total

37502

37502

 

Analysis of Sales and Purchase transactions to compile a Trial balance suing Double entry system:

   Sales: It refers to cash and credit figures related to items sold or services provided. In Royale, sales includes incomings like wages and other monetary benefits related to core business of entity.

Purchase: it refers to cash or credit figures related to items purchased by entity. In Royale, purchase incudes Weekly food shopping, Clothes, Drinks, Lunch purchases etc.  Following is a trail balance based on Table 1 based on double entry bookkeeping system to reflect all the incomings and outgoings for a particular month:

Particulars

Debit

Credit

Transaction amount

Wages

 

16500

16500

Gifts

 

23000

23000

Benefits

 

24000

24000

Allowances

 

19200

19200

Weekly food shopping

25200

 

25200

Clothes

16820

 

16820

Gifts

14100

 

14100

Household utility bills

3900

 

3900

Drinks

9980

 

9980

Lunch purchases

12700

 

12700

Total

82700

82700

165400

3. Formulation of basic trial balance by applying balance off rule:

Balance off rule: This is basically a process by which amount remain in ledgers are brought forward to next year to find the balance on each ledger account in order that a trial balance can be extracted as part of the accounting cycle (Schwager, Decker and Kaltenegger, 2016). In Royale balance off all ledgers at year end is significant to identify any misappropriation and preparation of financial statement.

Trial Balance

Particulars

Debit

Credit

Bank loan

 

12000

Cash in hand

11700

 

Capital

 

13000

Rates

1880

 

Trade creditors

 

11200

Purchases

12400

 

Sales

 

14600

Sundry creditors

 

1620

Debtors

12000

 

bank loan interest

1400

 

Other expenses

11020

 

Vehicles

2020

 

Total

52420

52420

The above trial balance describes that transactions are correctly recorded because account balance are properly recorded in trial balance and tallied. Trail balance contains sum of different expense and income account ledgers which are appropriately classified as per matching principle of accounting. Also matching of trial balance exhibits that all other generally accepted accounting principles are followed.     

Steps involved in drawing up trial balance:

After summarising and posting, trial balance is prepared by business organisation. Main motive of trial balance to identify arithmetical or other errors like omission, commission etc. Following are the steps required to be followed by Royale to prepare trail balance, as follows:

  1. Prepare a formate showing three columns: First is Particulars which contains account titles, second is debit balance of different accounts and third is credit balance of all accounts (Chung and Chung, 2018).
  2. Fill all accounts names along with their amount of balances as per their nature in debit or credit columns.
  3. Then calculate sum of  debit and credit columns.
  4. Evaluate reason if there is any mismatch in amounts.

TASK 2

1. Reviewing the different stages of the HR life cycle applied to Royale Restaurant:

 

Importance of HR Life cycle in relation to strategic talent management and overcoming issues of staff rotation:

In HR cycle strategic talent management is important in order to hire people, manage them, develop their skills which are necessary for organisation, and retain most appropriate qualified and expert employees in business organisation. Under HR cycle talent management plays significant role in formulation of strategy because it helps to manages its key employees. So organisation in hospitality industry like Royale should efforts to effectively manage employees in order to develop their skills, efficiency and capabilities in order to retain them. Following are the importance of HR Life cycle in relation to strategic talent management and overcoming issues of staff rotation:

Assists in Increase of employee performance: Using talent management helps to identify which employees are best and appropriate for respective job that results in decrease in issues related to performance management and staff rotation. It also ensures that best talent within organisation can be retain (Bowie et.al., 2016).

Employee motivation to attain goals: An organisation by strategic talent management  retain their employees by motivating them to achieve goals and provides reasons for them to stay in organisation.

Retain top talent: Under strategic talent management a properly organised on-boarding practices leads to favourable retention ratio that assist company to reduce its recruitment and performance management cost in long term.

Continuous coverage of critical roles: Strategic talent management create a framework for identify special skills to assign signifiant unique roles in workplace to its employees. This simply implies that company can achieve steady flow of employees to fill critical roles to assist organisation to run their functions smoothly and to avoid extra pressure.

 Recommendation: From above analysis it is clear that HR process should be improved by adopting new strategy and process to improve effective planing throughout the HR life cycle. By improving skill of employees and performance HR process can be effective to improve  planning.

2. Development of performance management plan for Royale Restaurant:

Short role play Script on the topic “ An employee is always late for work”:

In management performance plan should be in planned while considering negative effects of such plan after formulation of plan (Singh, 2015). Effective communication without any inappropriate words can enhance the quality of plan. Following brief script would be helpful for understanding such way of communication:

Script One:

Discussion should not be undertaken:

Manager: "Your work's been really sloppy lately."

Employee: Sir, due to adverse environment and excessive workload there is delay in work.

Manager: You are not sincere regarding your work allotted.

Employee: Sir, I am sincere enough but I need some more time to complete work.

Script Second:

Discussion should be undertaken:

Manager: "Your last three reports have contained an unacceptable number of statistical errors."

Employee: I made a mistake, for which I am sincerely sorry

Manager: Your performance is good but what is main cause which hinder your performance.

Employee: Sir, this task is new and I am working upon it, in order to give my best performance.

TASK 3

1. Identification of specific legislations that Royale  has to comply and adhere to:

Following are the major legislations that business like Royale related to hospitality industry has to comply, as follows:

  • Employment Act 2002: This act governs working policy of employees and terms & conditions of employment in hospitality sector. It helps to employment contact for while describing any penalties in case of violation of contract.
  • Food Safety Act 1990: This act requires business organisation to do not include or remove anything from food or beverages in a way that means it would be hazard to health of consumers. It also ensures that food served or sold is as per expectations of consumers in term of nature, substance or quality (Moeti, 2016).
  • Live Music Act 2012: The act describes that permission in form of licence is required for a live music event or performance. However there is no restriction in case such live music performance takes place during 8am and 11pm or it takes place at licensed premises or workplace or audience is no more than 500 people.

 

2. The way in which company, employment and contract law has potential impact on business:

Various regulations, legislations and standards brings some adverse effects for business organisation in hospitality industry. Changes in regulations or legislations requires change in process and activities in business operations. Company should change their process as per changes in regulations and also tracking of changes in these regulations helps to avoid any difficulties in near future. Due to regulations of Live music act, Royale should manage their music events as per these regulations or take a licence for such events. Following are the example of companies prosecuted under above described acts and regulations:

  1. Manager of Hamilton based Craig Services and Access Limited was  was condemned to a most extreme punishment of 2 year imprisonment for his disregard of well being and security commitments that prompted the death of man and made genuine damage to another (Higgins-Desbiolles, Moskwa and Wijesinghe, 2017).

2.Household goods giant Wilko was was penalised £2.2million after an event in which at a Leicester store, a 20-year-old female labourer paralysed, after an enclosure loaded with paint tins fell on her.

3.National car manufacturer Jaguar Land Rover was penalised after a labour lost their leg following a car concussion on the production line.

4.Fast food restaurant chain KFC was fined £1 million after 2 of its employees encountered burns injuries at two Stockton Borough branches.

5.Southwark Crown Court heard that Philip's sibling Paul incidentally turned around into his 38-year-old kin when the pair were attempting to move a stalled scissor lift on an administration street, while working for Laing O'Rourke.

  1. London and Southeastern (LSER) and Wetton Cleaning Services Limited (Wettons) were penalised with amount of £2.5m and £1.1m respectively in a prosecution brought by the Office of Rail and Road (ORR), following the death of a cleaner three years ago.

7.Fashion retailer JD Sports was fined with £60,000 following an investigation into two of its branches in Dudley.

  1. TATA appealed its conviction for two separate sentences after two workers’ hands were trapped in unguarded machinery.
  2. Aldi Stores Ltd was penalised with £1 million and directed to pay £70,000 as compensation to delivery driver who worked for company for two weeks suffered injuries to his foot while operating electric pallet truck at one of its stores.
  3. Bread giant Warburtons was fined £1.9m for guilty of breach of the Provision and Use of Work Equipment Regulations 1998, after labour of agency was injured when his arm became trapped in a machine for 20 minutes.

These type of complexities due to various regulations and legislation, can affect decisions of organisation. In hospitality industry changes in regulations affects working capital requirement and predetermined objectives or standards that leads to modification in vital decisions.

TASK 4

1. Interrelation between different functions and roles within hospitality sector:

 

  • Organisational Structure of Royale Restaurant:
  • Organisational Structure of Hospital:
  • Organisational Structure of Hotel:
  • Organisational Structure of Theme Park:

 These all organisation structures are related with business or sectors of hospitality industry. Each sector have various layers in organisational structure although these sectors or business have different role and task for employees, managers and other personnels (Bruce and Stephens, 2017). All functional role is defined through effective management plan and these roles are interlinked with each other in a systematic manner because functions defined under functional roles are interdependent and closely associated with other function. These interrelated functional role helps to provide smoothness in management of different tasks and functions.    

2. Different methods of communication, ordination and monitoring applied within specific department of the organisation:

 Following are the methods of communication, ordination and monitoring as follows:

Conference: This method is used in case of signifiant meetings of board members and top management. Through conference top management discuss about viability of any decision or for taking new decision and to commutate any significant matter. Video conferencing is also type of conference used in case any member is unable to attain meeting (Lub et.al., 2016).

Seminars: In large organisation there is thousands of employees so in order to communicate with them or  or to motivate them seminars are organised by top management. These method helps to cover wide number of employees.

Emails: This methods helps to circulate any general or specific matter quickly and effectively. This methods is used by management to ordinate or communicate any matter to employees.

Text Massage: This is informal method only used to communicate any sensitive matter to particular employee or group of employees. This methods ensures privacy of information.  

 

Analysis of importance of above described methods to achieve organisational benefits and Strangeness the value Chain:

These methods helps managers to efficiently communicate various information and to make coordination for accomplishment of task or activities effectively. Which leads to achievement of organisational benefits quickly and in effective manner. Coordination through these methods helps to eliminate any weakness in value chain and to enhance value chain. By applying these methods in organisational structure create a framework for decision-making and to attain predetermined goals (Foster and Carver, 2018).

Recommendation: From above analysis of it is clear that management should apply above discussed methods of communication, ordination and monitoring for enhancement of their own performance and others in organisation to establish a proper effective value chain. Organisation should encourage their managerial personnels to formulate a framework for proper use of such methods and also frame policies to avoid any difficulties related to methods.  

CONCLUSION

From above report it has been concluded that in hospitality business there are various aspects that directly or indirectly affects business operations. Analysis of management performance plan helps to formulate strategy for enhancement in performance and to achieve organisation's targeted objectives and goals. Various way of communication, ordination and monitoring methods helps to establish coordination among various department of organisation.

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REFERENCES

  • Ervin, S.A., 2016. Social Business Plan and Publishing Proposal for Global Toolkit.
  • Gnanapala, W.A.C., 2017. Public relations in hospitality marketing. Routledge Handbook of Hospitality Marketing.
  • Charterina, J. and Barrutia, J., 2014. Synergistic effects of cultural reshaping on a city's hospitality enterprises. Tourismos. 9(1).
  • Schwager, P., Decker, N. and Kaltenegger, I., 2016. Exploring green chemistry, sustainable chemistry and innovative business models such as chemical leasing in the context of international policy discussions. Current Opinion in Green and Sustainable Chemistry. 1. pp. 18-21.
  • Chung, G. and Chung, D., 2018. WOW the hospitality customers: Transforming innovation into performance through design thinking and human performance technology. Performance Improvement. 57(2). pp. 14-25.
  • Bowie, D., Buttle, F., Brookes, M. and Mariussen, A., 2016. Hospitality marketing. Routledge.
  • Singh, R., 2015. Empirical examination of the impact of total quality services on hospitality industry business. Journal of Quality Assurance in Hospitality & Tourism. 16(4). pp. 389-413.
  • Moeti, M.E., 2016. The development of a business social responsibility (BSR) model to promote the long-term sustainability of hospitality SMMEs in the Free State region(Doctoral dissertation, Bloemfontein: Central University of Technology, Free State).
  • Higgins-Desbiolles, F., Moskwa, E. and Wijesinghe, G., 2017. How sustainable is sustainable hospitality research? A review of sustainable restaurant literature from 1991 to 2015. Current Issues in Tourism. pp. 1-30.
  • Bruce, J. and Stephens, C.A., 2017. Bridging secondary and postsecondary leadership experiences: A toolkit for leadership learning facilitators. New directions for student leadership. 2017(155). pp. 95-106.
  • Lub, X.D., Rijnders, R., Caceres, L.N. and Bosman, J., 2016. The future of hotels: The Lifestyle Hub. A design-thinking approach for developing future hospitality concepts. Journal of Vacation Marketing. 22(3). pp. 249-264.
  • Foster, M. and Carver, M., 2018. Explicit and implicit internationalisation: Exploring perspectives on internationalisation in a business school with a revised internationalisation of the curriculum toolkit. The International Journal of Management Education. 16(2). pp. 143-153.

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