ETIQUTTE SUITE HOTEL

INTRODUCTION

This manual is designed to guide all employees of Etiquette Suites Hotel to help the new and
current employees familiarize to the company's policies, procedures and business culture. The
purposes of this manual are to ensure to the consistency of the accounting policies and procedures
applied across the operations of the entity, to ensure compliance with applicable accounting
standards, laws and regulations, and to properly implement the internal controls of the company
intended to promote the efficiency and effectiveness of the operations.

These policies and procedures are intended to affect the most cost efficient standardized method of
operation within the hospitality industry for the benefit of guests, investors, shareholders and
associates.

OVERVIEW OF THE BUSINESS

Etiquette Suites Hotel is a premier full service hotel that is committed to excellence in the local and
global market. Located in the heart of the City of San Fernando, Pampanga composing of four
segments of operation namely Food and Beverages, Travel and Tourism, Lodging and Recreation
that is an ideal place for business and leisure travel.

Etiquette Suites Hotel is dedicated in providing our guest a 100% satisfaction by means of
continually creating difference in our services, exhibiting honesty and integrity at all times,
maintaining good relationship with customers, suppliers, partners and employees and being the
leading expert in the company's business field
 ETIQUETTE SUITE HOTEL
ORGANIZATIONAL CHART

Board of Directors

President

VP VP
VP Finance
Administration Operations

Human Director, Food and

Chief Resident
Rescource Sales Beverages Controller
Engineer Manager
Manager Marketing Manager

Executive Front Office Catering Restaurant Executiv Beverage Bookkeeper

Accounting
Housekeeper Manager Director Manager e Chef Manager Clerk

Housekeepin Laundry Reservations Front Desk Guest PBX Sous Banquet Administrative
Steward
g Manager Manager Manager Manager Services Manager Chef Chef Assistant
JOB DESCRIPTIONS

1. BOARD OF DIRECTORS

Job Summary:

To ensure the company's prosperity by collectively directing the company's affairs, whilst meeting
the appropriate interests of its shareholders and stakeholders and dealing with challenges and
issues relating to corporate governance, corporate social responsibility and corporate ethics.

Duties and Responsibilities:

 Provide continuity for the organization

 Select and appoint a chief executive/president
 Govern the organization by broad policies and objectives
 Acquire sufficient resources for the organization's operations
 Serve as a Court of Appeal
 Ensure Effective Organizational Planning

2. PRESIDENT

Job Summary:

The president is responsible for providing strategic leadership for the company by working with the
Board and other management to establish long-range goals, strategies, plans and policies.

Duties and Responsibilities:

 Plan, develop, organize, implement, direct and evaluate the organization's fiscal function and
performance.
 Participate in the development of the corporation's plans and programs as a strategic
partner.
 Evaluate and advise on the impact of long range planning, introduction of new
programs/strategies and regulatory action.
 Develop credibility for the finance group by providing timely and accurate analysis of
budgets, financial reports and financial trends in order to assist the Board and senior
executives in performing their responsibilities.
  Enhance and/or develop, implement and enforce policies and procedures of the organization
by way of systems that will improve the overall operation and effectiveness of the
corporation.
 Establish credibility throughout the organization and with the Board as an effective
developer of solutions to business challenges.

3. VICE PRESIDENT FOR FINANCE

Job Summary:

Directing all aspects of accounting operations, overseeing all transactions related to general ledger,
receivables, payables, payroll and financial reporting and analyzing company's financial results with
respect to profits, trends, costs and compliance with budgets.

Duties and Responsibilities:

 Directing all aspects of accounting operations, overseeing all transactions related to general
ledger, receivables, payables, payroll and financial reporting.
 Analyzing company's financial results with respect to profits, trends, costs and compliance
with budgets. Issue regular status and ad hoc reports to senior management.
 Providing strategic guidance around capital financing options to support company growth
needs.
 Developing and coordinating all relationships with lending/financial institutions.
 Developing and maintaining all necessary accounting policies and systems, including general
ledger and financial reporting. Ensuring that records are maintained in accordance with
generally accepted accounting principles.

4. VICE PRESIDENT FOR OPERATIONS

Job Summary:

Providing overall direction and guidance to the operational activities of an organization and
formulate policies and plan the use of materials and human resources in a variety of businesses and
industries

Duties and Responsibilities:

 Plan out strategies and oversee their implementation

 Coordinate with all the departments of the company to ensure that all things work smoothly
  Work closely with all the departmental heads and ensure that none of the departments
overshoot their budgets
 During the period of final accounts, they have to work closely with the accounting
department of the company and should know all about accounting themselves
 Monitor the profits and losses of the company and ensure that the profits are growing
steadily each year
 Ensure that the debts of the company do not exceed the assets of the company
 Ensure that the company is in growth

5. VICE PRESIDENT FOR ADMINISTRATION

Job Summary:

Responsible for directing all of the administrative functions of the corporation in accordance with
industry standards, where applicable, regulatory agencies, as appropriate and company objectives
and policies.

Duties and Responsibilities:

 Lead, guide and mentor administrative staff in their tasks and functions.
 Integrate and coordinate functions of administrative, finance, sales and marketing
departments.
 Develop innovative strategies to enhance performance of the administrative staff.
 Assess and evaluate existing methods and functions in administrative functions.
 Track, monitor and document performance of each individual.
 Integrate, upgrade and update all databases.
 Plan, schedule and conduct training new employees.
 Supervise functions of payroll, vendor payments and accounts receivable and payable.
 Manage accounting, investing and financial services including audits.
 Ensure best corporate practices in implementing administrative activities.

6. DIRECTOR, SALES AND MARKETING

Job Summary:

The director of sales and marketing position is responsible for planning and implementing sales,
marketing and product development programs, both short and long range, targeted toward existing
and new markets by performing the following duties personally or through subordinates.
Duties and Responsibilities:

 Develops and implements strategic marketing plans and sales plans and forecasts to achieve
corporate objectives for products and services.
 Develops and manages sales/marketing operating budgets.
 Plans and oversees advertising and promotion activities including print, online, electronic
media, and direct mail.
 Develops and recommends product positioning, packaging, and pricing strategy to produce
the highest possible long-term market share.

7. CHIEF ENGINEER

Job Summary:

Hotel chief engineers work in hotel maintenance and operations. They may work in the hotel office
as well as with maintenance staff. They may oversee issues such as repairs and renovations, create
budgets, and hire and train staff.

Duties and Responsibilities:

 To ensure the smooth daily operation and guest appeal of the hotel.
 To direct the maintenance staff on small repairs, such as patching drywall, fixing faulty
wiring, or unclogging drains.
 To consult blueprints or product manuals in order to fix boilers or air-conditioning motors.
 To assign staff to repair sprinklers or instruct grounds crew to maintain outside landscaping.

8. RESIDENT MANAGER

Job Summary:

Hotel resident managers are responsible for the efficient running of hotels and lodgings. By
supervising staff and overseeing operations, they aim to ensure that the hotel maximizes customer
satisfaction, revenue and profitability. Resident managers live on the premises and are available on
call to deal with problems anytime, night or day. They generally report to the general manager of
an individual hotel or to the regional manager of a group of hotels.
Duties and Responsibilities:

 Must be able to deal politely and efficiently with guests to make sure that they are satisfied
with the service they receive.
 Must have good supervisory skills to lead and motivate a team of full-time and casual
employees.
 Financial and analytical skills are essential to ensure the efficient, profitable operation of the
business.
 must be able to work under pressure, particularly when the hotel has to deal with large
groups of guests, or when guests have complaints

9. CONTROLLER

Job Summary:

Hotel controllers are top-tier executives and as such usually report to the CEO or board of directors
of the organization. These professionals have a long list of responsibilities, including the preparation
of tax returns, financial statements, forecasts, budgets, profit and loss statements, and compliance
reports for the business.

Often controllers supervise other departments such as accounting, collections and billing, and
payroll. This executive is responsible for current accounting standards and regulatory requirements,
and sometimes the audits that are necessary to ensure compliance.

Duties and Responsibilities:

 Assist the accounting department with financial information and forms for tax compliance
needs
 Review and approve annual budgets and projections
 Closely scrutinize funds transfer and cash disbursement protocols within the organization
 Set or revise organizational policy when necessary
 Monitor performance of financial employees and recommend action to human resources
department when necessary
 In case of the absence of General Manager, the Controller may replace the general manager
in managing the entity but limited to the daily and normal operations of the business.
10. HUMAN RESOURCES MANAGER

Job Summary:

The Human Resources head oversee the daily operation of the Human Resources office.
Responsible for areas of Recruiting, Employee Relations, Benefits, Events, Workers Compensation
and other employee-related tasks.

Additionally responsible for short and long term planning of all the HR related functions like
workforce planning, recruitment, staffing strategies, wage and salary administration, associate and
labor relations, benefits, workforce training and development etc.

Duties and Responsibilities:

 To ensure that the company HR operational policies and processes are adhered to and
continually improved.

 To assist in all activities concerning the sourcing & recruitment of staff, performance
management, staff discipline and HR administration.

 To coordinate all matters of employee work permits and visas.

 To coordinate and / or conduct departmental training and conduct new hire hotel orientation
program.

11. FOOD AND BEVERAGES MANAGER

Job Summary:

Responsible for overall operation for the restaurant, food and beverage managers hire staff,
purchase food and stock, and make sure everyone is trained on proper food preparation, proper
and legal alcoholic beverage service kitchen safety techniques and understand health standards.
Food and beverage managers make sure that company is represented correctly and that the
company's standards are upheld.

Duties and Responsibilities:

 Customer-Service: Food and beverage managers might have to interact with customers. Being
friendly and courteous will help keep customers coming back.
 Attention to Detail: Food and beverage managers have to keep their eyes on a lot of elements:
food standards, costs, safety, etc.
 Leadership: Food and beverage managers must be leaders in the back of house, rallying their
team during heavy shifts, resolving conflicts and getting the job done.
 Management Skills: Food and beverage managers not only deal with food, they also have to
deal with costs, pricing, creating work schedules and more.
GENERAL POLICIES

 Etiquette Suite Hotel shall maintain its accounting records in conformity with Philippine
Financial Reporting Standards (PFRS).
 Accounting records will be maintained in accordance with the company’s calendar year
(January 1-December 31).
 Accrual method of accounting shall be consistently used in recording all transactions. The
company must records the revenues and expenses incurred, regardless of when cash is
exchanged.
 The double-entry method of bookkeeping shall be used. In accounting for every business
transaction will involve two or more accounts.
 The business entity concept of accounting shall be followed in maintaining its records. This
implies that Etiquette Suite Hotel and its owners shall be treated as two separately
identifiable parties.
 Aging of accounts receivable method shall be used in estimating of doubtful accounts of the
company.
 Straight line method of depreciation shall be used to all assets of the company that are
subject to annual deprecation.
 The financial statements of the company shall be prepared with the going concern principle,
this means that an entity will remain in business for the foreseeable future.
 A quarterly financial report must be prepared in accordance with PAS 34 (Interim Financial
Reporting) to attain timely and reliable financial reporting.
 In accounting for changes in accounting policies, accounting estimates and errors and
events after the Balance Sheet date, the pronouncements of PAS 8 and 10 shall be followed
to enhance the relevance, reliability and comparability of an entity's financial statements
 Etiquette Suite Hotel’s financial statements will be audited by an independent certified public
accounting firm on an annual basis in accordance with the Philippine Auditing Standards.
 A backup and restoration procedure must be followed to prevent data loss and to protect
the existing data and information in the system.
 There must be a group/personnel assigned in maintaining the database and there must be a
daily copying of files into an archive file of computer data so it may be used to restore the
original files in case there is a data loss event.
 The policies and procedures set forth in this manual will be followed by Etiquette Suite Hotel
in carrying out its daily operations.
INTERNAL CONTROL

Etiquette Suites Hotel will maintain an effective and adequate system of internal controls to provide
management with reasonable assurance as to reduce the risk of asset loss and help ensure that
plan information is complete and accurate, financial statements are reliable, and that the plan
complies with relevant laws and regulations.

The characteristics of an effective and adequate system of internal control will include the following:

 Separation of duties, this involves splitting responsibility for bookkeeping, deposits, reporting
and auditing and other duties to prevent conflict of interest and lessen the chance of
committing fraudulent act.
 A system of authorization and record retention.
 An effective information and communication system that will ensure the proper process of
gathering and disseminating information throughout the organization.
 An ongoing feedback mechanism that ensures that internal control systems are effectively
designed remains that way.

To achieve these objectives, the following controls will be in place:

 A system of checks and balances will be observed to ensure that no one person shall have
complete control over all phases of any significant transaction.
 Controlling access to different parts of an accounting system via passwords, lockouts and
electronic access logs shall be limited to authorized personnel.
 Frequent unannounced physical audit will be implemented.
 Standardized documents will be used for all financial transactions to maintain consistency in
record keeping over time.
 Custody of assets, authorization or approval of related transactions affecting those assets
and recording or reporting of related transactions shall be properly segregated.
 Responsibilities in the accounting department will be clearly established and followed as
closely as possible.
Internal control for Cash Receipt

 Separation of the key tasks involved in cash processing (authorization, custody and
recording process) will lessen the possibility of fraudulent acts.
 All employees who handle cash should complete a training course provided by the
accounting department on the appropriate procedures before having access to the log and
safe. These procedures should be documented in writing and handed to the employee at the
start of training.
 Store all cash in a safe or lockbox until it is deposited in the bank. Only the cash handling
clerk and one backup employee should have a key to the lockbox or the combination to the
safe. If either of these employees leaves the company or is reassigned to another position,
change the lock or safe combination.
 When a payment comes into the office, the cash processing clerk should immediately record
the transaction into the cash receipt log and assign it an identification number. If the payer
is present in the office, the clerk should issue a signed receipt listing the date and amount
received.
 The transaction numbers must be unique and sequential so an auditor can quickly see if a
cash receipt is missing from the log. If an employee transfers possession of a cash receipt to
another employee, both parties must sign a receipt stating the date and peso amount of the
transfer.
 Each day, the employee responsible for preparing the reconciliations should compare the
day's total from the cash receipts log with the daily bank deposits and the cash held in the
lockbox or safe. At the end of the month, he will print the general ledger reports for the
company's cash account and compare them to the monthly totals on the cash receipt log.
 Any discrepancies not due to deposits in transit should be investigated and the reasons
noted on the reconciliation report. Each reconciliation must be signed and dated by the
person who prepared it.
Procedure:

Customer’s check and remittance advices are received in the Mail room. A mail room clerk prepares
cash prelist and sends the prelist and the checks in the Cash receipts. The cash prelist is also sent
to Accounts Receivable clerk and the Controller. In the cash receipts it verifies the accuracy and
completeness of the checks, updates the cash receipts journal, prepares a deposit slip, and
prepares the journal voucher to send to the General Ledger.

Accounts Receivable posts from the remittance advices to the accounts receivable subsidiary ledger.
Periodically, a summary of the postings is sent to the General Ledger. General Ledger department
reconciles the journal voucher from the Cash Receipts with the summaries of accounts receivable
and updates the general ledger control account. The Controller reconciles the bank accounts.
Internal control for Cash Disbursement

1. All other disbursements should be made by check and should be supported by an approved
invoice.
2. All checks should be prenumbered sequentially and should be used in sequence.
3. The person who prepared checks in payment of invoices should not be the person who has
authority to sign checks. Preferably, two authorized signatures should be required on
checks, and invoices should be canceled in some way when they are paid so they cannot be
paid twice.
4. Those authorized to sign checks should not be allowed to prepare them or control the
supply of unused (blank) checks. Only those who prepare (but do not sign) checks should
have access to blank checks.
5. Any checks spoiled in preparation should be voided in some way so that they cannot be
reused.
6. Voided checks must be kept. Used checks should be audited to ensure that all numbered
checks are accounted for.It is advisable to use a check protector to print amounts on
checks, because this generally prevents anyone from altering the amounts.
7. If a mechanical check-signing machine is used, the key that allows this machine to operate
should be in the hands of the employee authorized to use it.
8. If the machine keeps a sequential count of the number of checks processed through it,
someone in authority should maintain a separate count of the number of blank checks used
and reconcile this periodically with the machine count.
9. Once the checks have been signed, manually or mechanically, they should not subsequently
be available to the person who prepared them.
10. They should immediately be mailed to suppliers, or distributed by another employer or
manager to employees in the case of payroll checks. Some larger hotels and restaurants
control check disbursements using a voucher system.
Procedure:

The first step is in an accounts payable procedure. It is properly recording the liability upon receipt
of merchandise, using the purchase order estimates as a guideline. For accuracy and timeliness of
data, a liability should be recorded as soon as the company receives the purchased items. By
necessity, this initial recording is usually an estimate and can be finalized when the actual invoice
arrives. This is why a Purchase Order is so important for merchandise purchases. It documents the
company’s understanding of how much each item will cost, per the vendor’s terms. This includes
estimates for freight and any other charges.

Before entering vouchers (invoices), be sure that all information for each supplier has been properly
entered into the system. Vouchers cannot be entered for a particular supplier until the appropriate
information is set up. Additional to this, purchase order, receiving report, invoice, and cash
disbursement vouchers are supposed to be provided correctly.

The second step involves the preparation, issuance of payment for the goods received,
At this stage, before selecting current payables and amounts to be paid, you should Open A/P
Report, both of which show the entire contents of the Accounts Payable File. The Cash
Requirements Report sorts this file by invoice due date whereas the Open A/P Report sorts this file
by vendor. In selecting vouchers for payment, you must first enter the intended payment date and
the cutoff due date.

All vouchers with due dates before the cutoff date will be marked for payment (unless otherwise
deferred) and all vouchers with due dates after the cutoff date will not be paid (unless otherwise
selected for payment). All vouchers with due dates before the cutoff date will be marked for
payment and all vouchers with due dates after the cutoff date will not be paid.

Transactions are then entered in a check register, also called a cash disbursements journal (the
journal used to record all of the checks, cash payments, and outlays of cash during an accounting
period). Bookkeeper record transactions in the check register before the business transactions are
posted to the general ledger and other ledgers associated with the transactions.

The supervisor of a department that disburse checks for any purpose is responsible for assuring
that proper procedures for handling, accounting, and reconciling cash and/or checks are followed.
Proper authorization from the controller is provided and a receiving copy is file. Initials document
which are submitted are then reverts back to the accounts payable procedure so as to indicate
grant of the cash disbursement.

And check issuance is realized with proper delivery to the supplier taking place.

The third step in the procedure is the taking of the transactions to respective ledgers and journals.
A/P Vouchers must be posted to the General Ledger to credit the A/P account(s) and debit the
expense accounts, as well as relieve purchase commitments. Hours and (optionally) dollars charged
by consultants are posted to the Labor History File in this process, as well. This journal can be
posted as often as your policy requires. The company post A/P weekly or twice a month. The
Voucher distribution is printed and review of the report to see that amounts and accounts charged
are correct. After printing and reviewing, it is posted in the journal to the General Ledger.

The Cash Disbursements Journal can be posted to the G/L as often as required, but no less than
once per month. This posting debits (decreases) the Accounts Payable account(s) and credits
(decreases) the cash accounts.

At this point the actual liability is finalized, with any necessary adjustments to the item costs,
freight, or other charges. and subsequent filing of all paperwork for easy retrieval.
CHART OF ACCOUNTS

Etiquette Suites has designated a Chart of Accounts specific to its operational needs and the
needs of its financial statements. A chart of accounts is a listing of the names of the accounts that
has identified and made available for recording transactions in its general ledger. The VP Finance is
responsible for maintaining the Chart of Accounts and revising as necessary.

Etiquette Suites Hotel

Chart of Accounts

Assets (1000-1110)
1000 Cash
1001 Petty Cash
1002 Cash in bank
1010 Accounts Receivable
1011 Allowance for Doubtful Accounts
1020 Notes Receivable
1030 Advances to Officers
1040 Interest Receivable
1050 Subscription Receivable
1061 Inventories
1062 Service Supplies
1063 Office Supplies
1070 Land
1080 Building
1081 Accumulated Depreciation – Building
1090 Service Equipment
1091 Accumulated Depreciation – Service Equipment
1100 Vehicles
1101 Accumulated Depreciation – Vehicles
1110 Patents

Liabilities (2000-2060)
2000 Accounts Payable
2010 Notes Payable
2020 Salaries Payable
2030 Taxes Payable
2040 Interest Payable
2050 Unearned Revenue
2060 Advances from Officers
2070 Loans Payable

Equity (3000-3040)
3000 Share Capital
3010 Share Premium
3020 Unappropriated Retained Earnings
3021 Appropriated Retained Earnings
3030 Treasury Shares
3031 Share Premium – Treasury
3040 Other Comprehensive Income

Revenues (4000-4040)
4000 Revenue from Accommodation
4010 Revenue from Food and Beverages
4020 Interest Income
4030 Gain on Sale of Property
4040 Income Summary

Expenses (5000-4040)
5000 Salaries Expense
5010 Supplies Expense
5020 Utilities Expense
5030 Interest Expense
5040 Taxes and Licenses
5050 Depreciation Expense
5060 Doubtful Account Expense
5070 Loss on Sale of Property
BUDGET PROCESS

In order to achieve the goals of the company and properly administer the financial assets and
resources of the company, an annual budget will be prepared by each department heads. This
annual budget will serve as tool in monitoring and controlling the finances of the company. A
Bottom-Up budget approach will be used in the budget making process; this means that each
division of the organization forms its budget in accordance to the general guidelines developed by
the management and will be approved by the President.

To properly facilitate an efficient and effective budget planning the following dates of the budget
process and responsibilities must be properly observed.

1. Preliminary Budget Meeting will be held in every first or/and second Wednesday of
October immediately preceding the start of the new calendar year. This aims to discuss the
planning process and strategies, priorities and general guidelines of the budget.
 The Controller will assist the department heads by providing reliable and relevant
information about cost factors and review on past budget performance.
 The Vice President for Finance shall serve the function of leading the preliminary
budget meeting together with the Vice President for Operations, Vice President
for Administration and the President.
2. Budget Development period will be from the date after the last preliminary budget
meeting until the last Wednesday of November immediately preceding the start of the new
calendar year. The first budget proposal must be submitted on the first Wednesday of
November immediately preceding the start of the new calendar year.
 The department heads will submit the budget to the controller.
 The controller will review, adjust and otherwise confirm the budget if it
comply with the company’s policies and budget for the next calendar year.
3. Budget Deliberation will be on the first and second Wednesday of December immediately
preceding the start of the new calendar year.
 The controller will send the budget to the Top management for review.
 The respective department heads shall defend the reasonableness of the
proposed budget.
 After careful consideration and formal discussion, a final budget shall be
produce
4. Budget Approval will be on the third Wednesday of December immediately preceding the
start of the new calendar year.
  A letter coming from the Office of the President will be sent as a
confirmation of the approved budget for the next calendar year.
5. A monthly budget review will be held on every fourth Wednesday of the month. This
aims to assess the performance of the department against its budget and to make
necessary corrections to overspending and modification to the budget if needed.
 The Vice President for Finance, in conjunction with the Controller, will be
responsible for the oversight of the budget(s) throughout the year.
 Monthly budget variance reports must be completed and distributed to
department heads 10th working day after the month.
 Proposed budget revisions (if any) must seek the approval of the controller
and the top management.
 I. PETTY CASH

Petty cash funds are intended to be used for small necessary purchases. These items would
include: postage due, freight bills, vending refunds, small items, hardware and supplies whose need
was not anticipated. Debit Card funds are intended for use of larger purchases such as: gift/suite
shop purchases, employee appreciation, office supplies and/or an emergency situation.

Procedure for Petty Cash:

1. The Controller is completely responsible for the petty cash fund.

2. Individual petty cash transactions should not exceed Php 2,500.00
3. Each disbursement should be properly supported by a petty cash voucher.
4. Each petty cash voucher shall be properly completed as follows:
i) Date.
ii) Amount of transaction.
iii) Description of item purchased
iv) Purpose of purchase
v) Person disbursing the petty cash
vi) Person receiving
vii) Approved by the Controller
viii) Completed mark in ink
5. Each voucher must be supported by an invoice, sales slip or other documentation evidencing
the nature of the disbursement. These documents should be stamped “PAID” to prevent
their re-use.
6. The petty cash transmittal is required to be completed and submitted to the Accounting
department according to the accounting report checklist due date.
7. All voucher and supporting documents must be attached to the original petty cash report
and maintained on property for seven (7) years.

II. BAD DEBT WRITE OFF

To establish procedures and guidelines for the write-off of bad debt. Accounts are submitted for
write-off under the following circumstances:

A. When all practical and reasonable collection efforts have failed (including legal action, if
appropriate), and the account is determined uncollectible.
 B. Because of the amount and/or circumstances involved, it is not considered practical or cost
justifiable to pursue the collection of the account.

The VP for Finance is responsible for determining those accounts to be submitted for write-
off. All Bad debt write offs must be signed for approved by Regional Director of Operations

PROCEDURES:

1. A write-off summary request should be prepared of city ledger accounts to be

written-off the books and the reason. The list of write-offs should minimally provide
for:
(i) The transaction date as shown on the monthly aging report.
(ii) The name of the account as shown on the monthly billing statement.
(iii) The amount.
(iv) The reason for requesting write-off (Skip – cannot locate, company out of
business, bankrupt, bad check, etc.).
(v) The signature of the General Manager and Regional Director of Operations.
2. Each account should have an Accounts Receivable Activity sheet attached which shows
all the steps that deem the account uncollectible.
3. All hotels are required to submit all requested accounts and their support to the
corporate office for approval before they write off any account.
4. Bad debit Write-Off’s should be reviewed, approved and processed (booked) prior to the
end of the accounting period each quarter (i.e. March15th, June 15th, September 15th,
and December 15th).
5. The original, approved write-off form with attached account detail shall remain on
property for future reference.
6. All recoveries of bad debts previously charged off are to be credited to the allowance for
doubtful accounts.

III. CAPITAL EXPENDITURES

The purpose of this policy and procedure is to ensure proper accounting for fixed asset acquisitions.

1. Definition: Expenditures in excess of Php25,000.00 to acquire land improvements, building,

machinery, furniture and fixtures, office equipment, business machines and other capital items,
whether by purchase or construction and for major alterations, rearrangement or repair to
existing facilities.
 Purchase of capital items with an individual value of less than Php25,000.00 are to be expensed
except in the following circumstances:

a. When the item(s) are an integral part of a capital project

b. When the aggregate cost of identical or closely related items, purchased under one
purchase order exceeds Php25,000.00 in total.
2. Determination of Cost: The capitalized cost of a fixed asset is to include all costs in connection
with its acquisition, including purchase price, delivery costs, freight, installation costs, sales,
excise or other taxes applicable. Also, any other cost required to prepare the asset for its
intended use.
3. Capital Expenditures vs Current Expense: In distinguishing between a capital expenditure (fixed
asset addition) and a current expense (repairs and maintenance), value and time are the
elements of major importance. In distinguishing between a capital expenditure (fixed asset
addition) and a current expense (repairs and maintenance), value and time are the elements of
major importance. You must determine of the expenditure adds to the value of the building,
furniture and equipment, etc or extend their useful life. According to tax authorities, examples
of repairs include re-painting the outside and inside of a building, mending leaks, plastering and
conditioning gutters on buildings. On the other hand the costs of a new roof, lighting
improvements in a factory, and bricking up windows to strengthen a wall are capital
expenditures.

NOTE: Capital expenditures may only be authorized by an officer of Etiquette Suites. Capital
expenditures are all purchases that are capital in nature must have a Purchase Order prepared
on site with proper approvals and sent to Etiquette Suites Corporate Office for approval before
the order of these items can be completed.

IV. A/R DIRECT BILLING PROCEDURE I

PROCEDURE:

1. Upon completion of the night audit, the auditor will print two (2) folio copies from the
previous days check outs and place in the designated (Controller or designate) mail box.
2. The folio’s are to be reviewed for accuracy and any adjustment required will be taken care
of without delay.
3. One copy of the statement and folio to be processed and sent to the account and the
second copy to be retained by the hotel and properly filed.
 4. A reminder statement should be sent for unpaid balances between the 25th and 30th of the
month.
5. Brand reward program billing should be forwarded and submitted according to the brand
standard.
6. All direct bill statements should be mailed within 24 hours of departure – Fed-Ex if
appropriate. When payment is received and before posting to the account the amount
should be verified. Should you receive and overpayment or incorrect amount the check, the
company must be contacted for verification prior to being posted. All checks must be
secured in hotel safe until deposited.

When payment is received and before posting to the account the amount should be verified.
Should you receive and overpayment or incorrect amount the check, the company must be
contacted for verification prior to being posted. All checks must be secured in hotel safe until
deposited.

V. A/R COLLECTION PROCEDURE II

PROCEDURE:

1. Past due accounts (over 30 days), must be contacted to verify invoice/statement has been
received. Notes should be taken regarding discussion and outcome of call.
2. The use of an outside collection or letter writing service should be considered the “last
resort” after all the hotels reasonable collection efforts have been exhausted. The personal
involvement and responsibility of the hotel VP for Finance cannot be over emphasized with
accounts of this nature.
3. The engagement of an outside collection service is governed by HP Hotels Corporate
Offices.
4. Outside collection services will be furnished (photocopies only) of account detail and not
the original document.
5. Accounts in the hands of a collection service will be reported individually on the monthly
aging report as usual; except “collection service” should be noted along with the date the
account was turned over.
6. Accounts turned over to a collection service will normally be fully reserved, but should not
be submitted for write-off until collection efforts have been discounted by the service.
 7. Upon discontinuing the collection activity, the service must return the account
documentation (photocopies) to the hotel.
8. Invoices and collection letters must be mailed in accordance with the following schedule
(all days from the guest check out date).
9. We will not accept any future reservations or bookings from a client of 30 days past due
until balance has been cleared. (Unless otherwise approved per agreed upon billing cycle)
Guest Check Out (last folio transaction) 0 Day Account Transferred to A/R +1 Day First
Invoice/Statement Sent +1 Day Second Invoice/Statement Sent +30 Days Third
Invoice/Statement Sent +45 Days First Collection Letter +60 Days

NOTE: In reference to small balances, the General Manager will determine when the account is
not economical to pursue. Such accounts should be submitted to write-off.

VI. A/R COLLECTION PROCEDURE III

Delinquent Accounts:

1st Letter – A “friendly reminder”. This letter should be courteous and should not, in any way,
infer that the guest does not intend to pay. It should recite our previous billings and date.

2nd Letter – Send certified mail. Reference previous invoices and the first letter. Firmly but
politely insist on immediate payment and advise client that billing privileges are in jeopardy.

Collection letters should be generated through the Front Office System or comparable system
depending on your property using the Dunning Message” listed below and the attached sample
correspondence letters. Start using this feature immediately. Dunning Message: Current:
Payment is due within 30 days of the transaction date. +45 Days This amount is seriously past
due, your prompt attention is appreciated. +60 days. This amount remains past due. Your
payment is expected. Your account may be suspended.
 Sample Letter #1

Date ___________________
Name __________________________________
Account # ____________
Company Name _________________________
Company Address_________________________
City, State, Zip ___________________________

Dear_____________________, Thank you for choosing

__________________________________for your recent stay in -----City-----. Hotel Name In
today’s fact paced world, time goes by quickly. As of today your account in the amount of
Php_____________ is 30 days past due. Perhaps there are questions pertaining to your billing.
Please contact me as soon as possible to resolve any outstanding issues. We hope that you will
continue to use _________________________ for your future accommodations.
Hotel Name
Best Regards,
VP for Finance
000-000-0000

Sample Letter #2

Date _________________
Name _____________________________
Account #___________________
Company Name _____________________
Company Address____________________
City,State,Zip ________________________

Dear ____________________, In our previous letter of (date) we stated that your account was
past due. As of today your account in the amount of Php______ is over 60 days past due.
Again, if you have any questions pertaining to this past due balance, please contact me. Your
billing privileges may be in jeopardy. Please give this matter your immediate attention. If
payment has been remitted, please disregard this notice.

Best Regards,
VP for Finance
VII. ACCOUNTING INTERNAL AUDIT
1. The adequacy and effectiveness of the system of internal control.
2. The adequacy of plans.
3. The quality of performance against plans, established objectives and goals.

PROCEDURES
1. The “Self Audit Survey” (Exhibit 8A) will aid the internal auditor in evaluating the existing
procedures at each location.
A. Scope of Audits; a.
A. Cash
B. Accounts receivables
C. Revenue & Expense
D. Accounts Payable
E. Payroll
F. Food & Beverage
G. purchasing
H. issuing
I. receiving
J. controls
K. storage
L. Other pertinent areas
M. Inventory & operating supplies 2.
2. The principal responsibilities of the Auditor is to provide management with an independent,
fast and objective appraisal of the effectiveness of the company’s financial accountability
systems and operational performance in accordance with their standard operating
procedures.
3. The Audit will provide management with positive recommendations designed to strengthen
and improve performance results and cost effectiveness of their operations.
4. Format of Audit Report
A. Observation
B. Strengths
C. Weaknesses
D. Recommendations for Improvement
 5. A written response is required by the President for all audit reports within 30 days after the
issuance of the report.

VIII. ADVANCE DEPOSIT POLICY (SALES)

Advance deposits serve several purposes. They provides an indicator of the intention of the
prospective customer, allow for an edge against possible loss and allow the Hotel recovery of costs
should the account become non-collectable. As a general rule, advance deposits of up to 90% of
the estimated value of the business should be obtained at least two (2) weeks before the function
for the following types of business:

SALES GROUPS
A. Sports teams in non-established leagues or sports
B. Social or family gatherings
C. Politically oriented groups
D. Tour groups are required to send the 1st night’s deposit upon confirmation of business or
30 days prior to arrival, whichever occurs last and the balance must be paid upon arrival.

PROCEDURES
When the booking of a group or function becomes definite and the contract is completed, this
should include the deposit requirement necessary to hold the room and assure the facility that
has been committed. Should deposit request not be honored by the prospective customers, the
possibility of not being afforded the rooms required should be clearly conveyed. The details of
the cancellation penalties, if any, would also be explained. This requirement is not meant as a
deterrent to booking business, but as a measure to safeguard the asset of the company. When
presented properly and firmly, requests for advance funds should bring affirmative responses.

NOTES:
1. Do not offer direct billing to the client, but do discuss forms of payment. 2.
2. If a customer desires to be billed, a credit application must be presented and filled in
thoroughly and returned to the General Manager two (2) weeks prior. The General Manager
must verify a minimum of three (3) references.
3. Incomplete application or those credit applications not received within two (2) weeks of
arrival will not be processed.
 Credit application for business of Php250,000.00 must be signed by an official of the company
requesting direct billing and a copy of the business credit card must be submitted for guarantee
purposes.
IX. MEETING/CATERING DEPOSIT SALES

MEETING ROOM
Any time a meeting room is reserved the client should be told that Php 5,000.00 deposit is
required to hold the room and the remainder of the amount is due upon arrival to the hotel.
Posting of the deposit should be done upon confirmation of the room in the Reservation system.

CATERING
Whenever catering is involved the Php 5,000.00 deposit is required to hold the function room.
Thirty (30) days prior to the function the client will be contacted and the catering arrangements
confirmed. At this time, 50% of the catering charge will be collected. Final payment is to be
collected when the guarantee is confirmed (3 business days prior to the function). All deposit
postings should be at each interval. It is also imperative that the guest understands if there is a
change in the count (+ or-) will be handled on the day of the function.

Please make sure when collecting deposits for a meeting room and/or catering function,
cancellation policies are understood by the client in writing.

X. BAGGAGE SERVICE CHARGES

Baggage service that is required by any groups will be paid to the designated associate(s).
a. Baggage service is part of a group bill to be paid to the associate(s) for service
performed.
b. All baggage service charges must be paid through the Hotel payroll system.

XI. INVENTORIES
1. Liquor – An inventory of liquor shall be prepared at mid-month, as well as at the end of
each month.
2. Food – An inventory of food shall be prepared at mid-month as well as at the end of
each.
3. China, Linen, Glass and Silver – An inventory of china, restaurant linen, glass and silver
shall be prepared on a quarterly basis, reconciled to established par stock to determine needed
replacements.
 4. Month End Food & Beverage - All mid-month and month-end food and beverage
inventories shall be taken and submitted on the monthly Food & Beverage Inventory Control
Form.
5. Inventory Levels – Food inventories should be kept in the range of fifteen percent (15%)
to eighteen percent (18%) of total food revenues. Beverage inventories should be kept in the
range of eighteen percent (18%) to twenty percent (20%) of total beverage revenues.
6. Miscellaneous –
a. All inventories must be reviewed and approved by the VP for Operations
b. Inventories should involve personnel from outside the F&B Department to establish a
separation of duty. (2 people required to do inventory – 1 calling, 1 writing)
c. All prices should be updated prior to conducting inventory.
d. Bulk peso values for “Food in Process” are not acceptable.

XII. PRE OPENING EXPENSES

DEFINITION: Pre-opening expenses are those expenditures which are reasonable and necessary
in connection with the opening of a specific new project.
a) Expenses chargeable to “Pre-Opening Expenses” are those expenditures incurred prior to an
opening which would otherwise have been chargeable to an operating expense had they not
been in connection with a “new” project.
b) Pre-opening expenses do not include expenditures for acquisition of capital assets which are
subject to depreciation.
c) Pre-opening expenses include, but are not limited to the following:
(a) Advertising and business promotions prior to opening
(b) Supplies and other operating expenses such as:
(i) Menus
(ii) Guest checks
(iii) Logo items
(iv) Napkins
(v) Initial supply inventory (kitchen,bar,cleaning,guest,etc)
(vi) Uniforms
(vii) Training
(viii) Licenses & taxes
(ix) Salaries and benefits of personnel
(x) Opening Party & Sales Blitz
 (xi) Travel
d. An asset account called “Pre-Opening Expenses” should be set-up for all new projects or
acquisitions. All pre-opening expenses should be moved to this account via journal entry
after opening.
e. Pre-Opening Expenses for new projects or acquisitions are to be amortized on a straight line
basis over five years.

XIII. CREDIT APPROVAL

Some business practice dictates that we should thoroughly establish guest identity and credit
worthiness prior to approving any credit privileges. Approval and investigation of company
requests for direct billing of their accounts rests with the VP for Finance or corporate office as
appropriate. The credit investigation and approval procedures presented in this S.O.P. are
intended as general guidelines.

PROCEDURES
a. Credit Investigation
i. Companies – except where the hotel has long standing, satisfactory credit
experience with a company or organization, a credit investigation must be
performed and documented. The use of a Standard Credit Application
(located under forms) is to be used for this purpose. All items/references on
the form must be verified (by telephone or letter) prior to credit approval.
Comments on any difference between information given by the applicant and
that obtained by verification should be entered on the reverse side of the
application form. Any other pertinent information (slow pay, problem
accounts, etc) should also be noted on the form. In addition to the company’s
bank and business references, local credit bureaus, business associations and
the like may be available sources of credit information. In addition to
establishing the company’s credit worthiness, it is essential that a principal of
the company provide the hotel with a written authorization for the
individual(s) to incur charges on behalf of the company. Preferably, the
authorization should be on company letterhead stationary, signed by a
principal. Any limits on this authority (such as “room only”, etc) must be
clearly stated in the authorization letter.
 ii. Distressed Passengers/Tour Agents/Operators – Normally, the extension of
credit to tour operators, distressed passengers and travel agents will involve
the acceptance of :paper” (vouchers, coupons, M.C.O.’s etc), which is
redeemable in specified room nights and/or services and is payable by the
operator or selling agent when billed. When dealing with an agent/operator
with whom the hotel has had no previous business experience, banking and
business references should be obtained and verified as in the case of any
other credit applicant.
iii. Individual – Under most circumstances, the extension of direct bill credit
privileges to individuals is not recommended. Where the extension of credit is
justified, however, banking and business references should be obtained and
verified in the same manner as for a company.
b. Approval The approval of direct billing credit privileges shall be made by the General
Manager. This approval authority may not be delegated.
c. Documentation The Standard Credit Application properly completed and approved,
and/or other documentation supporting the credit investigation and approval shall be
maintained for a minimum of one year after the account has been paid and has
evidences no further activity.

NOTE: The guest/client’s credit application should be updated whenever an account has been
inactive for six (6) months, or more, or whenever additional or more credit information is needed to
increase limits, etc.

Additional Notes:

a. Do not offer direct billing, but do discuss forms of payment.

b. If a customer desires to be billed, a credit application must be presented, filled in
thoroughly and returned to the General Manager at least two (2) weeks prior to arrival.
c. Incomplete application or those credit applications not received within two (2) weeks
of arrival will not be processed.
d. Credit application for business of Php 250,000.00 must be signed by an official of the
company requesting direct billing.
e. Minimum of three (3) references to be verified.
f. When possible a copy of the company credit card to guarantee the direct billing.
XIV. PURCHASE ORDER SYSTEM

PURPOSE:

1. To control expenditures at point of purchase.

2. To provide confirmation of items as to quantity, price, specification, size, etc.
3. To provide an audit trail for invoice/statement from supplies.
4. To provide a basis for accrual accounting. By doing so, the profit and loss statement more
accurately reflects the operating results for that period.

SCOPE:

Includes any and all goods/services purchased from outside suppliers, which totals $25.00 or more,
except travel expenses.

LEVEL OF AUTHORIZATION/APPROVAL

1. Up to Php1,250.00 Department Head No Purchase Order Required

2. Php1,250.00 – 25,000.00 Director, Sales Marketing submits P.O. to VP for Operations for
approval to purchase and is assigned P.O. number.
3. Over Php 25,000.00 VP for Operations submits P.O. to Corporate Office for approval to
purchase (includes normal operating supplies). To be submitted every Friday.

XV. PURCHASE ORDER

HOW TO COMPLETE A PURCHASE ORDER: Most purchases are made through the internet and
therefore actual Purchase Order Forms are no longer used. However, prior to placing an order a
copy of the order form should be prepared and items needing to be replenished marked off.

1. On the order form fill in quantity ordered (each,dozen,case,etc)

2. Fill in the extended item price
3. Submit to the Controller for approval and P.O. number
4. Over Php 25,000.00 , VP for Operations to submit to Corporate office for approval
5. Once approved submit order and retain order form to verify upon delivery
 VERIFYING DELIVERY:

All deliveries will be verified prior to the driver leaving the premise by using the original order form
against the packing slip. Note any back orders listed on packing slip and refuse in additional items
that have been shipped. It is most important that the driver signs off on any refused item. In some
case, the driver may not be permitted to take back unordered items. If this is the situation, the
vendor representative will be contacted immediately to retrieve the item and sign off on the
removal of the item from the property. The packing slip and original order form is then turned into
the VP for Operations to verify against the invoice/statement.

XVI. CHARGEBACKS
There are two (2) types of Chargeback’s. The customer direct dispute and the credit card
chargeback.
Customer Direct Dispute – is when the customer calls the hotel direct to dispute a charge. If a
cardholder contacts you directly before contacting his/her bank and has a charge dispute, it is
up to the Resident Manager to research the dispute and contact the customer with the support.
If the dispute is valid and a credit needs to be issued, confirm with the cardholder and follow-up
with a call or e-mail stating the amount credited and the date the credit was issued.
Credit Card Chargeback – a chargeback is a transaction that a card issuer returns to a merchant
bank as a financial liability and which in turn a merchant bank may return to a merchant. In
essence, it reverses a sale transaction. Chargeback’s are not always a result of what a merchant
did or did not do. Errors are also made by merchant banks, card issuers and cardholders. Any
chargeback needs to be thoroughly investigated and disputed within 24 hours of receipt.

NOTE: Whether the dispute is generated directly by the guest or through the cardholders bank
all instances should be handled and responded to within 24 hours. Part of our guaranteed
payment with our processor is No Show Billings. No Show billings need to be completed daily.

Thorough training of your associates will minimize a chargeback. Listed below are items that
can be done to eliminate chargeback’s:
1. Always swipe the credit card through the magnetic reader.
2. Manually imprint credit cards on the guest registration card.
3. Clean magnetic readers several times a year.
4. Keep food and beverage away from computers and readers.
5. Hold the credit card through the entire transaction process (allows time for the associate to
check features & security elements).
 6. Always compare signature before returning card to the cardholder.
7. Never provide cash advances. Direct guest to a local bank.
8. Any card that is presented unsigned, verify through government issued identification (state
issued I.D., drivers license, passport).
9. Read, train and distribute updates to associates provided by your processor.

XVII. CHECK REGISTER/LOG

PURPOSE:
To provide a complete record of all incoming checks. The Mail/Check Register should be
maintained by the person opening the mail each day. This register/log should contain the
following information:
1. Amount of check.
2. Name of maker.
3. Folio or A/R account to which the check is applied.
4. Date check was received.
5. Signature of Controller attesting to the register being checked to insure all items have
been properly posted.
6. Log book needs to be maintained with daily register along with copies of all checks
received.

PROCEDURE:
1. In order to maintain proper control, it is essential that the General Manager opens all mail
sent to the hotel, without exception.
2. All checks, money orders, etc, must be stamped “For Deposit Only”. All checks received
will be listed in the Mail/Check Register as follows;
a. City Ledger
b. Credit Card Ledger
c. Advance Payment
d. Commission Checks
e. Petty Cash
3. The following columns of the Mail/Check register should be completed before posting to
the account.
a. Check Number
b. Amount c. Date
 d. Name of maker
e. Account Name
4. The Controller will post the payments and drop in the safe as a separate deposit.
5. The completed check register needs to be maintained in a binder with copies of each
check.

XVIII. SALVAGE SALES – FIXED ASSETS

PURPOSE:

To establish procedures to be followed in accounting for fixed asset salvage sales.

1. This applies to the sale of used, obsolete and/or surplus fixed assets by Inns.

2. Where feasible, competitive bids are to be obtained when disposing of fixed assets.

3. The sale of fixed assets as mentioned above should be recorded on the hotel’s books as
follows:

a. Fully Depreciated Assets – Proceeds from the salvage sale of fully depreciated
fixed assets should be booked as a credit to account Salvage Sales Income in your “Other
Income Department”.

b. Assets not fully depreciated – proceeds from the salvage sale of fixed assets which
are not fully depreciated should be record on the books of your Inns as a credit to the fixed
asset account charged for the cost of the asset at the time of purchase. When computing
depreciation on “additions to the fixed assets account:, the proceeds from the salvage sale
should be deducted from the amount of “addition” to arrive at a net amount to depreciate.

4. All salvage sales require a sign off from the Etiquette Suites Accounting Department.

XIX. A/P TRANSMITTALS

1. Each time accounts payable invoices are prepared for processing to accounting, a transmittal
sheet should be prepared for all invoices (in accordance to the Etiquette Suites Systems Accounting
Checklist): (attached below – procedures, Chart of Accounts and Expense Dictionary)

a. Accounts Payable
b. Debit Card Report
c. Petty Cash
d. Linen Inventory
 e. ATM Report
f. Managers Check Register
g. F&B Inventory & Recap h. Breakfast Inventory
2. Transmittal Numbers – all accounts payable sheets should be numbered according to Etiquette
Suites Systems policy.

3. Transmittal Sheet – copies of each transmittal sheet should be maintained at the property for
General Ledger reconciliation. It is also necessary to attach invoices to the transmittal sheet.

4. Invoice Coding – all invoices to be coded prior to placing on the transmittal sheet to include
vendor number and chart of accounts assignment. Place accounts in numerical order on the
transmittal sheet.

5. Transmittal Sheet – should be submitted to Etiquette Suites on a weekly basis depending upon
the day of week assigned to your property

XX. SYSTEM BACK UP

PURPOSE:

To enabled your hotel to have the most current data available in case of a computer hardware or
software failure.

All PMS systems are backed up during or after the night audit. It is mandatory that the backup
procedure is completed without fail each night.

General Managers will make weekly backups of files on any additional computers assigned to them.

NOTE: Consideration of off sight storage should be discussed with Etiquette Suites Controller
TAX FILING

For tax purposes, Etiquette Suite is classified as Domestic Corporation and a VAT Registered
business entity in the Philippines. To avoid penalties and unnecessary delays in complying with tax
requirements, the management has established the following standards to create an efficient
process to comply properly with the tax filing requirements.

1. Monthly Remittance Return of Creditable Income Taxes Withheld (BIR form No.
1601-E)
a. This return shall be filed in three copies
b. The return shall be made in the name of the corporation and shall be signed by the
president or any authorized officer and counter signed by the controller.
c. The finance department shall be responsible in preparing the return.
d. The return must be finalized in the 5th day of the month following the month in which
withholding was made except for taxes withheld for December which must be prepared
on or before January 20 of the succeeding year.
e. The return shall be filed and tax paid on or before the tenth (10th) day of the month
following the month in which withholding was made except for taxes withheld for
December which shall be filed/paid on or before January 25 of the succeeding year.
f. The return shall be filed and the tax must be paid with the UCPB San Fernando or any
Authorized Agent Bank of the Revenue District Office 21B.
g. Where the return is filed with the UCPB San Fernando or any Authorized Agent Bank of
the Revenue District Office 21B, the lower portion of the return must be properly
machine-validated and duly stamped by the Authorized Agent Bank to serve as the
receipt of payment.
h. The finance department shall observe the memorandums of the BIR regarding this
return.
i. All necessary documents in the process of filing this return must be kept for 7 years.

2. Monthly Remittance Return of Income Taxes Withheld on Compensation (BIR form

No. 1601-C)
a. This return shall be filed in three copies
b. The return shall be made in the name of the corporation and shall be signed by the
president or any authorized officer and counter signed by the controller.
c. The finance department shall be responsible in preparing the return.
 d. The return must be finalized in the 5th day of the month following the month in which
withholding was made except for taxes withheld for December which must be prepared
on or before January 20 of the succeeding year.
e. The return shall be filed and tax paid on or before the tenth (10th) day of the month
following the month in which withholding was made except for taxes withheld for
December which shall be filed/paid on or before January 25 of the succeeding year.
f. The return shall be filed and the tax must be paid with the UCPB San Fernando or any
Authorized Agent Bank of the Revenue District Office 21B.
g. Where the return is filed with the UCPB San Fernando or any Authorized Agent Bank of
the Revenue District Office 21B, the company must accomplish and submit BIR-
prescribed deposit slip, which the bank teller shall machine validate as evidence that
payment was received by the Authorized Agent Bank.
h. The finance department shall observe the memorandums of the BIR regarding this
return.
i. All necessary documents in the process of filing this return must be kept for 7 years.

3. Monthly Value-Added Tax Declaration (BIR Form No. 2550M)

a. This return shall be filed in three copies
b. Attachments required by this return must be duly accomplished.
i. Duly issued Certificate of Creditable VAT Withheld at Source, if applicable;
ii. Duly approved Tax Debit Memo, if applicable;
iii. Duly approved Tax Compliance Certificate, if applicable;
iv. Proof of the payment and the return previously filed, for amended return.
v. Authorization letter, if return is filed by authorized representative.
c. The return must be prepared not later than the 15th day following the close of the
taxable month.
d. The returns must be filed not later than the 20th day following the close of the month.
e. The returns must be filed with UCPB San Fernando or any Authorized Agent Bank of the
Revenue District Office 21B.
f. Where the return is filed, the company must accomplish and submit BIR-prescribed
deposit slip, which the bank teller shall machine validate as evidence that payment was
received by the Authorized Agent Bank.
g. The finance department shall observe the memorandums of the BIR regarding this
return.
h. All necessary documents in the process of filing this return must be kept for 7 years.
4. Quarterly Value-Added Tax Return (BIR Form No. 2550Q)
a. This return shall be filed in three copies
b. Attachments required by this return must be duly accomplished.
i. Duly issued Certificate of Creditable VAT Withheld at Source, if
applicable;

ii. Summary Alphalist of Withholding Agents of Income Payments Subjected

to Withholding Tax at Source (SAWT), if applicable
iii. Duly approved Tax Debit Memo, if applicable;
iv. Duly approved Tax Compliance Certificate, if applicable;
v. Proof of the payment and the return previously filed, for amended
return.
vi. Authorization letter, if return is filed by authorized representative.
c. The return must be prepared not later than the 20th day following the close of the
taxable quarter.
d. The returns must be filed not later than the 25th day following the close of the taxable
quarter.
e. The returns must be filed with UCPB San Fernando or any Authorized Agent Bank of the
Revenue District Office 21B.
f. Where the return is filed, the company must file the Monthly VAT declaration, together
with the required attachments, and pay the VAT due thereon with the UCPB San
Fernando or any Authorized Agent Bank of the Revenue District Office 21B.
g. The company must accomplish and submit BIR-prescribed deposit slip, which the bank
teller shall machine validate as evidence that payment was received by the Authorized
Agent Bank.
h. The finance department shall observe the memorandums of the BIR regarding this
return.
i. All necessary documents in the process of filing this return must be kept for 7 years.

5. Quarterly Income Tax Return (BIR Form No. 1702Q)

a. This return shall be filed in three copies
b. Attachments required by this return must be duly accomplished.
i. Certificate of Creditable Tax Withheld at Source (BIR Form 2307), if applicable
ii. Duly approved Tax Debit Memo, if applicable
 iii. Previously filed return, if an amended return is filed for the same quarter.
c. The return must be prepared not later than the 40th day following the close of the each
(3) quarters of the taxable year.
d. The return must be filed not later than the 60th day following the close of the each (3)
quarters of the taxable year.
e. The required payment must be paid with the UCPB San Fernando or any Authorized
Agent Bank of the Revenue District Office 21B.
f. The finance department shall observe the memorandums of the BIR regarding this
return.
g. All necessary documents in the process of filing this return must be kept for 7 years.

6. Payment Form (BIR form No. 0605)

a. This form shall be accomplished:
i. Every time a tax payment or penalty is due or an advance payment is to be
made;
ii. Upon receipt of a demand letter/assessment notice and/or collection letter from
the BIR; and
iii. Upon payment of annual registration fee for new business and for renewals on
or before January 31 of every year.
b. This return shall be filed in three copies
c. Attachments required by this return must be duly accomplished
i. For Voluntary Payment:
 Duly approved Tax Debit Memo, if applicable;
 Xerox copy of the return (ITR)/ Reminder Letter in case of payment of
second installment on income tax.
ii. For Payment of Deficiency Taxes from Audit/Delinquent Accounts
 Duly approved Tax Debit Memo, if applicable;
 Preliminary Assessment Notice (PAN)/ Final Assessment Notice (FAN)’
Letter of Demand;
 Post Reporting Notice, if applicable;
 Collection of Delinquent/ Accounts Receivable
d. The return shall be filed and the tax must be paid with the UCPB San Fernando or any
Authorized Agent Bank of the Revenue District Office 21B.
e. The Company must accomplished and submit BIR-prescribed deposit slip which the
bank teller shall machine validate as evidence that the BIR tax payment was deposited
to the account of the Bureau of Treasury.
KEY FORMS

Petty Cash Voucher

Acknowledgment Receipt

Cash Receipt

Payment Voucher

Purchase Order

Pay slip Form

Supplies Requisition Form

Statement of Account Form

Sample letters for Bad Debt Collections