Auditing ACC 254
Part three — Case
Hotel Heaven is just a stroke away
The hotel is situated on the beautiful Island of St Maarten and has been in operation for 15 years now. The hotel management is experienced staff. The hotel has a relatively large staff (25 persons in service). Payroll is a large part of operating expenses. For businesses in St Maarten it is always hard to find qualified people.
The hotel has 40 high standard rooms and 1 bridal suite. The hotel is open throughout the year and has fluctuating occupancy percentages.
Limited high quality hotels with superior service are available in St. Maarten. There are no other hotels like Heaven is just a stroke away in Dutch St. Maarten. Managing a hotel is very expensive in St. Maarten.
Currently Sint Maarten has a stable government. The hotel currently has good relationships with Government. Government issues rules and regulations for hotels to maintain proper standards and especially with regard to personnel there are many rules to abide by. Regular checks are made by government institutions to see to it that the hotel is living up to the regulations. Non abiding can, when found by government, result in high fines.
The economy of St Maarten is currently suffering from the financial crisis in the USA. An unstable economy will have a direct impact on the hotel as the guests may cancel their bookings, or even not make anymore bookings. The hotel guests mainly comprise of returning guests. Almost 25% of the guests have even been coming to the hotel for more than 10 years in a row now. The ave a room revenue per ni it for the hotel is a lot hiezLLhan the average hotels in St Maarten.
The objective of the hotel is to provide an unforgettable holiday experience with full Lservice staff and rooms that are more than perfect.
Next to the management of the hotel there is a board of shareholders. The hotel is owned by a group of 5 shareholders for which the capital is divided equally. The five viol shareholders meet on a bi monthly basis to discuss the status of the hotel. Prior to the 00) meeting they receive financial overviews of the hotel. The financial manager of the hotel is the cousin of one of the shareholders. This shareholder also operates a wholesale operation for hotels on St Maarten where foods and other stock such as plates and cutlery can be purchased. The other shareholders have no relationships to management. The general manager of the hotel has been with the hotel for 10 years now. The audit assignment has been given to your company by the board of the 5 shareholders.
The general manager has weekly meetings with department heads. Management discusses the key risks faced by the organizations on regular bases (for most 9.N N issues weekly): Management is involved in the daily activities. Management receives al
Final exam 6 of 8
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Final exam ….pdf