SOP Finance and Accounting – Guest Ledger and City Ledger

Support Our Work

Since 2011 Setupmyhotel has been helping hundreds of hoteliers around the world. Support Setupmyhotel by becoming our Patron!

What is a Guest Ledger and City Ledger?

Purpose of Guest And City Ledger:

In the hospitality industry, managing guest and city ledgers is a critical function of the finance and accounting department. Guest ledger refers to the accounts of individual guests, while city ledger includes accounts of businesses or organizations.

The guest ledger tracks all transactions of a particular guest during their stay at the hotel, including room charges, food and beverage expenses, and any additional services such as spa treatments or transportation. It is essential to maintain accurate and up-to-date records of guest ledger to prevent any discrepancies in billing and ensure timely payment.

On the other hand, city ledger includes accounts of businesses or organizations that have an ongoing relationship with the hotel, such as corporate clients or travel agencies. The city ledger is usually managed by an account executive who is responsible for billing and collections.

An effective management of guest and city ledgers requires a robust accounting system that can handle multiple transactions, generate accurate bills and invoices, and provide detailed reports.

It is crucial for the finance and accounting department to work closely with other departments, such as front office and sales, to ensure seamless operations and exceptional guest experience.

The purpose of this policy is to define receivables and collection responsibility. All Receivables residing in the Guest Ledger are the responsibility of the Front Office and those in the City Ledger are the responsibility of the Accounting Office.

Guest And City Ledger SOP Procedures:

1. Guest Ledger represents the unbilled accounts of guests who are currently in the Hotel, advance deposits, master accounts, and house accounts. These receivables will remain at the Front Desk and are the responsibility of the Front Office Manager.

2. City Ledger represents the billed but uncollected accounts of guests who have departed from the Hotel. These receivables are the result of Guest Ledger and become the responsibility of the Accounting Department, with the Controller ultimately responsible.


All accounts for direct bills must be approved and authorized by the Credit Supervisor before the Front Office cashiers can transfer the completed Guest Ledger accounts to the City Ledger. The credit approval should be done before arrival. The transfer to City Ledger should be done on the day of check-out for individual and voucher accounts and on the third day for group masters.

A thorough review of each account transferred to City Ledger is the direct responsibility of the Front Office Manager in conjunction with the Accounting Department Credit Supervisor. Under no circumstances should undocumented items be transferred to the City Ledger to clear the Guest Ledger.

Once items have been transferred to City Ledger, it is the responsibility of the Accounting Department to follow up on collections on all accounts. Any adjustments that are to be made to these accounts are

to be properly documented and approved by the Controller or General Manager and Manager of the department whose revenue is affected.


Daily, all accounts receivable payments will be received by someone other than an accounting staff member. They will be logged and a duplicate of this Log and copies of the checks will be given to Accounts Receivable. The checks will be dropped in the drop safe.

Payments are then posted to the subsidiary City Ledger by the Credit Supervisor. The last page on the ageing is then displayed or printed and compared to the General Ledger City Ledger balance to ensure the two are in balance. All discrepancies are to be identified and corrected immediately.

If a payment is partial, the customer will be contacted immediately to determine how the payment is to be applied. If the payment is an overpayment or duplicate payment, a refund check will be sent immediately.

If a payment is received and an account cannot be located, the customer will be contacted immediately to determine the disposition of the payment.

When clearing credit balances from the accounts receivable again. whether arising from overpayment or non-utilization of advance deposits (excluding forfeited deposits due to insufficient notification by the quest), every effort must be made to locate the proper recipient. In the unusual circumstance where this cannot be accomplished, the remaining credit balance would be recognized as miscellaneous income after six months. At month-end, a copy of the ageing should be retained (as backup) with the General Ledger account.


The billing of accounts receivable is to be maintained daily. with no more than three (3) working days between the date the guest account is transferred to City Ledger and the date it is placed into the mail, except for Banquet Master Accounts which should be in the mail no later than five (5) working days.

The initial billing on all accounts will include a statement and backup invoices (l.e. folios, etc.) to support each current transaction reflected on the statement. All bills over $10,000.00 should be sent via certified mail.


1. The first billing from the property will be within 3 days of the guest’s departure from the Hotel. All group billings should contain a pre-printed card identifying the Accounts Receivable Supervisor or Credit Manager as the person to contact to discuss billing.

10 days after the first bill is mailed, all accounts should be telephoned to confirm that the bill has been received and to determine the status. The results of this call should be recorded in the guest’s file. If it is determined that the bill was not received or is incorrect, a corrected billing will be sent out by overnight mail with a follow-up phone call to verify receipt and expected payment date.

2. Every 10 days communication should be attempted to determine the status of the account and documented. The results of this call should be recorded in the guest’s file.

3. When the account has aged 70 days, the Controller will then decide:

a. Write off the account as uncollectible;

b. Continue collection efforts from the property: or

c. Send to the collection.

Training Summary Questions:

Q1. Who is responsible for all receivables residing in the Guest and City Ledger?

Q2. What do Guest Ledger and City represent? 

Q3. What is the billing cycle for accounts receivable?

Q4. What happens when an account ages 70 days?
SOP Number: Finance and Accounting SOP – 34
Department: Accounts Receivable
Time to Train: 30 Minutes
Spread the love

Back Office Job Description Banquet BAR Beverage Service Cashiering Chef Chef Training Cleaning Concierge Duties and Responsibility Engineering Executive Chef F&B Setup F&B Training Finance Food Service Front Desk Front Office Formats Front Office Setup Front Office Training Guest Room Guest Services Hospitality Basics Hotel Formats Hotel Security Hotel Staff Job Description Hotel Staff Training Housekeeping Formats Housekeeping Setup Housekeeping Training Kitchen Kitchen Basics Kitchen Training Maintenance Maintenance Technician Reservation Restaurant Sales SOP SOP F&B Service SOP Finance and Accounting SOP Front Office SOP Housekeeping SOP Kitchen Staff Training

Support Our Work

Since 2011 Setupmyhotel has been helping hundreds of hoteliers around the world. Support Setupmyhotel by becoming our Patron!

Learn more