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A city ledger, also called a house ledger, is a hotel's accounting method for tracking non-guest transactions. Hotel accounting is divided into front-office and back-office operations. The front-office typically deals with registered guests and records their transactions to the guest ledger. Money that the hotel handles that is not attributable to a currently registered guest becomes part of the city ledger and is handled by the accounting department in the back office.
Accounting systems use ledgers to collect related accounts. A city ledger is a collection of related accounts that tracks money a hotel brings in that is not part of a transaction associated with a currently registered guest. Some hotels use different terminology for this ledger, calling it the house ledger or the non-guest ledger. Whatever the ledger may be called, however, the function tends to be the same in standard hotel accounting systems.
City ledgers typically contains at least four accounts. The first type of account is set up for individuals and businesses that use the hotel for meetings and events. Money collected from these types of customers are processed by the hotel's accounting department, instead of the front desk. Usually, these customers receive a monthly bill or invoice that details charges associated with the event, rather than charges from a hotel stay. Weddings, conferences, seminars and group meetings are examples of events that would be tracked by this account in the ledger.
On this same note, the second type of account handles transactions for traveling executives. If a company has an open account with the hotel that allows any of the company's employees to stay while they are in town, the transactions are recorded in the ledger as a company's house account. The accounting department typically bills the company monthly for the charges generated.
Another city ledger account typically acts as a credit card holding account. When a guest uses a credit card to make payment, the amount is transferred from the guest ledger to the city ledger while the hotel waits for the credit card company to release payment. This reflects the fact that the guest is no longer staying at the hotel, so the open account cannot remain with the front desk. Once the guest leaves, the hotel's accounting department is responsible for making sure that the credit card company remits payment.
Guests who fail to settle their bills when they leave also have the amounts transferred to an account in the city ledger. The accounting department becomes responsible for initiating collection proceedings against the person or following up as needed. This ensures that the hotel department that is most able to manage a collection process is assigned to the task.
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