9

foods must be thawed and cooled properly. Any food that is cooked, cooled and then
reheated, must be reheated to 165 F.

Personnel Hygiene and Health

Anyone who directly handles or prepares food must regularly wash their hands. Hand-
washing facilities must be located in all areas where there are people handling or preparing
food. There must also be a hand cleaner, towels and waste receptacle. Any employee with a
communicable disease that could be transmitted through food cannot participate in food
preparation or handling activities. Nor can employees participate if they have open wounds,
sores or cuts. All food workers must have clean garments and hair restraints. Food workers
are not permitted to eat, drink or smoke in food preparation areas, nor are food workers
permitted to touch ready-to-eat foods with their bare hands. One employee must be
designated to make sure that all employees are following these regulations and are in
compliance with the health codes.

Storage and Handling

All dry food, utensils and equipment must be stored at least six inches above the ground.
Cold food must be stored in a commercial refrigerator that is insulated and hard sided with
enough ice to maintain 41 F. Hot food storage units must be able to maintain at least 140 F.
Thermometers must be on hand and available to check temperatures. Wet storage is only
allowed if the water contains at least 10 ppm or available chlorine, and the water is changed
frequently. Food on display must be protected from customer handling or contamination. All
food preparation areas must be off limits to customers.

Cleaning
All kitchens should have a commercial dishwasher that can wash, rinse and sanitize all
equipment that comes into contact with food. All utensils and equipment that comes into
contact with food must be washed and sanitized every four hours. Sanitizers must be used at
their appropriate strengths.

Water
Every kitchen must have enough water on site for cooking, drinking, cleaning and sanitizing.
The water supply system or hose must prevent the backflow of contaminants from entering
the water supply. An approved wastewater disposal system must dispose wastewater.

Premise
Shelves and containers that hold food must be easily cleanable and smoothly finished. Floor
should be concrete, asphalt, tight wood or a non-absorbent matting. Walls and ceilings must
be well made and offer protection from outdoor elements in addition to preventing dust and
debris from entering the kitchen. The kitchen must have adequate lighting and bulbs should
be shatter resistant if in food-preparation areas. There should be a sufficient number of
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garbage containers and toilet facilities with hand-washing facilities. All toxic materials must
be labeled.

AUDIT OF BANQUET

Banquet income

Sales in connection with banquets, private parties etc. should accounted for in the respective
selling departments. Sales of goods and  services not sold in the ordinary course of business
by any selling department of the hotel, except in connection with banquets, may  be
accounted for in accordance with one of the following methods:

1) Credit to the various expense accounts: If such sales are only occasional, or if the
profit on them is negligible or not practically determinable, the sales should be
credited to the various expenses accounts to which the cost would be naturally
charged. For example; under this method, an occasional sale of music would be
credited to music and entertainment and an occasional sale of flowers to
decorations/Florist.
2) The cost of goods and services sold in connection with banquets which are not
regularly sold by any  department and  are not applicable to any  specific expense
items in the food schedule, should be charged to banquet expense and the relative
sales credited to the same account.

Credit to ‘Other Banquet Income’: If the ‘Other’ sales in connection with banquets are of
sufficient importance to  make  it  desirable  to  determine the profit on such  sales,  accounts 
should be opened in accordance with this schedule. The profit on such sales should be carried
over to the food schedule as ‘Other Banquet Income’.

Each function is a separate occasion. It has its own  price, menu and  manning. It must be
closely controlled, especially when food production takes  place in a  separate kitchen and 
bar. The revenue and the direct costs can be ascertained with accuracy. The main records
include:

– A function agreement, which summarizes the arrangement for each function.

– A function diary, which lists details of all functions in date order.
– A function chart, which provides a visual record of all functions arranged for a period
ahead.
– In-house information and restriction list.

The revenue and  the  direct  costs  can  be ascertained  with  accuracy.  The  volume of 
identical meals prepared and  served together enables the Hotel/Resort to have higher profit
margins; as such functions represent the second most profitable hotel product after rooms.

Deposits system in banquet operation

A deposit must be requested and paid prior to the event (amount of days is depending on the
contract agreement). The balance is to be paid upon departure of the group, unless otherwise
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agreed/stated or contracted. When a group confirmation is made through the responsible

Sales person  to its client a ‘Function Order’ is to be issued and  send to the Finance
Department for debit note issuance. Upon receipt of the deposit, a deposit receipt record is
sent to the respective Sales person confirming receipt of deposit. For clients/Corporate
accounts requesting no deposit, the Sales person may receive authorization and  approval
from the Dir. of Sales & Marketing. For trusted accounts, the Sales Department and the
Finance Department can mutually agree and continuously update a list of credit accounts for
waiving requirements of prepaid deposits.

Balance Payment: All F&B functions and Banquet Operation information shall be settled by
cash or credit card upon departure. Cheques are not accepted for settlement of  F&B  expense
unless prior approval has  been  given from the Director of Finance.

After Billing: For  improved  customer  service,  billing  after  departure  may  be granted to 
credit  worthy  and trusted  client accounts. In  such  case, a  letter/fax/email of authorization
is  to be received  in advance  from  the  client  to  confirm  expenses  that  are  covered  on 
its  company  account. Payments received for F & B expenses should be recorded on a
control list and passed to Finance Department for receipt issuance and recording.

Cancellations for Banquet Operation: For functions where a deposit has been received, the
deposit is refunded only if the cancellation was made (xx) days  prior to the actual function
date (depending on contract agreement and policy). For any cancelled group/account, a lost
business report is to be filed.

Payment settlement for banquet operation

Cash bar

-For cash settlement; the Banquet Manager/Supervisor shall return (to the cashier for
posting), the original and  signed copy of the payment statement, while the account copy is
retained by the cashier. For  city  ledger  charge;  the  signed  check is  given  to  the  cashier 
for  posting  and  all  copies retained by the cashier.

Banquet Operation Master bill: The master payment statement must be prepared by the
person in charge of the function and  is settled either by  cash or by  credit card. For credit
card payments; the cashier shall check the outstanding balance and request approval from the
credit card company.

Expenses for banquet operation Music and Entertainment: Music and Entertainment
hired for banquet purposes. Decorations, Cost  of  flowers,  plants  and  decorations 
purchased  for  banquet purposes  and  charged  to banquet engagers. If, however, the
hotel/resort operates a florist department, the sales and cost of flowers, plant and  other
decorations furnished by  the florist should be credited and charged, respectively to that
department.
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Mechanical work and Equipment: Setting up and  removing of stages, scenery, specific
electric wiring, spotlights, moving pictures projectors,  PA  and   A/V  equipment,  material 
and   labour  furnished  by   the  mechanical department.

Other Incomes: There  are  other  sources  of  Hotel/Resort  income   which  is   not  
connected  directly  with  the operational activities.

All these Banquet Operation incomes are received in small amounts from different
heads: Rentals – Space used for the operation of a hotel as a part of usual hotel service.
Rental received from these are credited to Rental Account.

Few general policies for banquet operation

Banquet Operation Car park Policy: Car park for banquet clients are normally offered
“Free of charge”. Parking tickets might be needed, stamped to validate the ticket. The stamp 
is placed on the registration desk in front of the function room of each function.
In case of large functions, such as wedding parties etc. which requires sufficient parking lots,
the car parking requirements are listed on the ‘Function Order’.

Banquet Operation Uniform Policy: F&B department issues a uniform request form to
linen & uniform department/HK.Each employee collects one set of uniform. The laundry
records names. Employee is held responsible for his/her uniform.  Unnecessary damage is
charged to the employee concerned. Soiled uniform has to be exchanged daily according to
the opening hours. Linen room attendant records items received onto the daily uniform
exchange sheet. In case of emergency after the official opening hours, Duty Manger is to be
contacted; urgent requests are recorded in the linen room Supervisor log book. All items shall
be returned the next day.

Banquet Operation Linen Policy: Soiled linen must be exchanged daily according to the
opening hours. Linen  exchange  for  banquet  takes  place  according  to  the  opening 
hours.  In  case  of emergencies after the official opening hours, Banquet
Manager/Supervisor/Captain must inform the duty  Housekeeper in charge. Urgent requests
are recorded. Request items are returned the next day. Banquet associates pre-count all soiled
linen before returning to the linen room/attendant for re-count and exchange. Linen recount
column on the exchange list is completed by the Linen Room Attendant.
Final comparison of banquet and laundry in exchange sheets. Derivation is remarked and to
be received after cleaning and pressing is finished.

RESTAURANTS AND BARS

Introduction
Many restaurants, especially smaller or closely held ones, are cash intensive and employees
and/or owners handle large volumes of cash transactions every day. For this reason,
examiners will focus on evaluation of internal controls. When a sole proprietor counts cash at
the end of the day, records all entries in the sales journal and makes the bank deposits, there
is a possibility not all cash is reported and deposited. This can also be true when orders are