The 12th meeting for Specific Industry Audit Class on Wednesday, December 15, 2021, was hosted by Ms. Grace Prativi (KPMG Indonesia Partner) and Ms. Jeanne with Hospitality, especially Hotel and Resort as the topic. A few of the topics discussed were: types of hospitality industries, terms that are used in Hotel Industry, and tax aspects. Class was conducted dynamically, whereby in the middle of the lecture session, students were asked to actively participate in analyzing the financial statements of a hospitality company to further comprehend the hospitality industry directly.
Audit procedures are unique depending on the client’s industry and the risks. From samples of companies audited, it could be seen that the value of fixed assets was very large since the hospitality industry prioritized fixed assets, especially because there were categories of hotel types that regulated the class of the hotel in terms of fixed assets. The speaker discussed account types that had large values so they needed to be monitored one by one. Those accounts were: Fixed Assets, Salaries and Wages expense, and Utility Expense.
The main risks in the hospitality industry are revenue recognition, fixed assets/investment property and trade receivables. The issues related to the risks mentioned with the most appropriate audit program carried out were discussed one by one, starting from room revenue, fixed assets and property investment, trade receivables in terms of control approach, substantive approach, valuation, impairment testing, type of customers, and concentration risks. The main issue discussed specifically was the pandemic that was going on and affecting the industry. The main concern during the pandemic was the decrease in the number of visitors in hotels, such that layoffs happened in the hospitality industry. Some hotels restructured their employee benefits and affected the company’s going concern. The session ended with questions from students, answered by lecturers, so that students could gain extensive knowledge with regards to the hospitality industry.