Chapter 1
A Strategic Managerial Accounting
Perspective to Hospitality,
Tourism & Events operations
© 2012 Jones et al: Strategic Managerial Accounting: Hospitality, Tourism & Events Applications 6thedition, Goodfellow Publishers
Objectives
After studying this topic you should be able to:
 Understand the difference between
managerial and other forms of accounting;
 Explain the main characteristics and feature
of the hospitality, tourism and events
businesses and their implication for
accounting;
 Reflect on the way managers can utilise
strategic management accounting information
to aid planning, control and decision making.
© 2012 Jones et al: Strategic Managerial Accounting: Hospitality, Tourism & Events Applications 6thedition, Goodfellow Publishers
The differences between
financial and management
accounting
Financial Accounting
External to organisation, including
Shareholders, Lenders, Suppliers, Regulatory
Authorities, Government, Employees,
Customers
Reporting for Accountability and Corporate
Governance purposes. Historically focused,
recording what has happened.
Management Accounting
Internal to organisation, including Managers
at all levels
Frequency
Annual - Routine
Level of reporting
Whole organisation, plus some limited
reporting of different segments of business
Type of data
Focus of reporting
Regulation
Financial data and compliance data
Accurate and verifiable (audited)
Regulated by General Accepted Accounting
Principles (GAAP), rules established in
international financial reporting standards
(IFRS) and specific International Accounting
Standards (IAS)
Monthly, weekly, daily, either routine and
non–routine reporting (ad hoc)
Multiple levels – unit/venue level, product or
service level, departmental level, by
customer, geographic region or whole
organisation as required
Financial and non-financial data
Timely and useful, to aid managers
No regulation, or requirement to use
Users
Purpose
Decision Support - information designed to be
used by non- accountants to aid them in
decision making. Forward focused, using
financial information to aid the future of the
operation.
© 2012 Jones et al: Strategic Managerial Accounting: Hospitality, Tourism & Events Applications 6thedition, Goodfellow Publishers
Hospitality , Tourism and
Events interaction
Strategic Management accounting: extends management
accounting as it is externally focused (market & competition)
and extends from using financial data to incorporate nonfinancial data and is strategic in focus.
Strategic management accounting is an accounting
discipline.
Strategic managerial accounting is the use by managers
of strategic management accounting to support their decision
making in a competitive environment.
© 2012 Jones et al: Strategic Managerial Accounting: Hospitality, Tourism & Events Applications 6thedition, Goodfellow Publishers
Hospitality , Tourism and
Events interaction
Staying within a local hotel
for the event is hospitality
Running the event is
event management
Travel agent booking'
transport, event tickets, and
hotel is tourism
The combination of hospitality,
tourism and events
Attending an
international
sporting
event
© 2012 Jones et al: Strategic Managerial Accounting: Hospitality, Tourism & Events Applications 6thedition, Goodfellow Publishers
Customer provision
combinations in hospitality,
tourism and events
Hospitality
Tourism
Events
Hospitality
Tourism
Events
Contract catering
Hotel
accommodation
as part of a tour
package
A wedding,
including the
provision of
specialist catering
services
A water sports
business at a
tourist resort
A charity
international trek
event
The booking of
holidays to
international
sporting events
Running a local
civic event (that
does not include
hospitality
provision)
A business
tourist, booking
his hotel through
a travel agent
Provision of
accommodation
for those that
attend a trade
show / exhibition
© 2012 Jones et al: Strategic Managerial Accounting: Hospitality, Tourism & Events Applications 6thedition, Goodfellow Publishers
Characteristics of
hospitality, tourism, &
events











Fixed capacity
Changeable demand
Perishability
Range of products and services offered
Concurrent production and consumption
A real time activity
Business size
Nature of labour
Location implications
Capital intensive
Operating cost structure
© 2012 Jones et al: Strategic Managerial Accounting: Hospitality, Tourism & Events Applications 6thedition, Goodfellow Publishers
Summary

Accounting and finance is split into three key areas (Financial
accounting, Management accounting and Financial
management).

Management accounting provides managers with information to
aid decision making.

Strategic managerial accounting is the management use of a
range of financial and non-financial data, with an external
perspective for strategic decision making.

The nature of hospitality, tourism and events provides a number
of key characteristics that impact on appropriate managerial
accounting techniques that are useful.
© 2012 Jones et al: Strategic Managerial Accounting: Hospitality, Tourism & Events Applications 6thedition, Goodfellow Publishers