Chapter II

Review of Related Literature

Foreign Literature
2.1 Foreign Literature
According to Tarigan Josua, Devie, Putri Felycia Eri, (2015) "The Usage of Accounting
Information System in Hotel and Restaurant Management: An Evidence from Indonesia,"
Journal of Applied Business and Economics, Vol. 17, Iss.4, pp. 105-117, Considering the benefit
of Accounting Information System (AIS) for hotel and restaurant management, this paper aims to
demonstrate the positive correlation between competition intensity, firm size, learning
organization and the usage of AIS. In order to survive in the competition, the management of
hotels and restaurants must be able to make the appropriate decisions using the help of
Accounting Information System (AIS). The result of this study was preceded from 190 owners
and managers which is provides a reference for academia as well as the business field.
2.2 Foreign Literature
According to Hematfar et al (2015) provided an article entitled with the evaluation of
information technology applications in hotel accounting and auditing. They dealt with the
influences and applications of information technology in auditing and accounting, and introduced
the information technology and its different approaches and styles in accounting and auditing.
Finally they found that by great developments of information technology, all the companies and
organizations have to invest in this sector to keep their stability, and the accountants should
determine and realize the new technologies and properly apply them to offer proper solution to
decrease the risks and damages.
2.3 Foreign Literature
According to Michael J. TurneraSean A. WaybDemianHodaricWiardaWittemanc (2017) n the
current study, we contend that to enhance their competitiveness and performance, hotel
properties need to develop and implement internal policies and procedures such as strategic
management accounting that are consistent with their business strategies and account for
changing competitive demands. We employ a sample composed of 80 hotel properties to
investigate the key precursor of hotel property strategic management accounting use and its
impact on hotel property customer and financial performance. The results highlight that market
orientation business strategy is a key determinant of hotel property strategic management
accounting use and illuminate the mediating influence of hotel property strategic management
accounting use and hotel property customer performance on the relationship between hotel
property market orientation business strategy use and hotel property financial performance.
Recommendations are provided for both researchers and hotel managers concerning their future
study of, or use of, strategic management accounting.
2.4 Foreign Literature
According to Nyide, Celani John (2016) Material Flow Cost Accounting (MFCA) is one of the
Environmental Management Accounting (EMA) tools that has been developed to enable
environmentally and economically efficient material usage and thus improve resource efficiency.
However, the use of this tool to improve resource efficiency in the South African hotel sector
remains unknown. An exploratory study, qualitative in nature, was conducted using a single case
study with embedded units approach. A Hotel Management Group that met the selection criteria
formed part of this study. In-depth interviews were conducted with 10 participants and additional
documents were analysed. The investigated hotels have developed technologies that provide an
environmental account in both physical and monetary units which constitute the use of MFCA to
improve resource efficiencies. However, the study established a number of factors that affect the
implementation of MFCA by the hotel sector in a South African context.
2.5 Foreign Literature
According to Paiva, I. S., Reis, P., Lourenço, I. C. (2016) This study characterizes the results of
social-scientific, behavioral science, and managerial/accounting research on current management and
accounting matters in the hotel industry published in the most prestigious scientific hospitality journals
and identifies avenues for future research. Based on an analysis of a set of 55 articles published in the
journals that make up the SCImago Journal and Coutry Rank, published between 2005 and 2015, it is
concluded that there is a lack of research in the financial accounting group; additional research is required
for the small hotel category, and it is the important to use comparative studies that are better able to
capture the characteristics of the hospitality industry. Additionally, most of the empirical studies analyzed
come from European countries and statistical methods are extensively used in all topic areas. Finally,
some gaps are identified in the literature and indicated future research priorities

i
Local Literature
2.1 Local Literature
According to TISC-Tourism International Scientific Conference (2018) Accounting information
and Accounting Information Systems are of great importance in the company in support of
various business-financial decisions. Considering the growing and more dynamic development
of information technologies and the "information society", there is a need to constantly review
the existing, develop and implement new and more modern technologies. The aim of this paper
is to examine the importance of Accounting Information Systems, by examining the importance
of using Accounting Information Systems in the hotel industry, in order to indicate the necessity
of development. Also, on the basis of the subject of research and analysis of results, several
research questions were opened regarding further directions of research and the possibilities of
perceiving the importance of using Accounting Information Systems in the hotel industry.
2.2 Local Literature
According to Allison, Gregory S. The 2014 edition of "Financial Accounting for Local and State
School Systems" updates the 2009 (see ED505993) and 2003 editions of the handbook. The 2003
edition was the work of the NCES National Forum on Education Statistics, Core Finance Data
Task Force. That task force systematically rewrote nearly the entire text, incorporating new
chapters and reviewing and revising the account code structure and account code definitions. The
2009 edition of the handbook incorporated changes resulting from the issuance of GASB
Statements 40 through 47. This edition incorporates changes resulting from the issuance of
GASB Statements 48 through 70. Appended are: Summary of Account Code Changes Since
2009; Other Resources; Glossary of Acronyms; Illustrative Financial Statements for an
Independent School District; and Criteria for Distinguishing Equipment From Supply Items.
2.3 Local Literature
According to Evangelista (2008), “Professional accountants have an important role in society.
Investors, creditors, employers and other sectors of the business community, as well as the
government and the public at large rely on professional accountants for sound financial
accounting and reporting, effective financial management and competent advice on a variety of
business and taxation matters. The attitude and behavior of professional accountants in providing
such services have an impact on the economic well-being of their community and country.”
(Evangelista, 2008,

Review of Related Studies

Foreign Studies
According to some authors (Barros & Dieke, 2008; Chen, 2007), performance evaluation in the
past was restricted to performance indicators for partial measures of productivity, without taking
into account either the multiple variables of the hotel industry. Our literature review showed that
several recent studies have included multiple inputs and outputs of the hotel industry in their
analysis which has led to more comprehensive performance measures (Barros, 2005; Chiang,
2006; Honma & Hu, 2013; Manasakis, Apostolakis, & Datseris, 2013; Oliveira, Pedro, &
Marques, 2014; Yu, 2012; Zhou & Wu, 2013). For example, Barros (2005) concluded that
economies of scale and location are important issues in determining hotel efficiency.
Honma and Hu (2013) found that hotels operating in several cities enjoy scale efficiency and
that the hotels that operate in one city suffer from scale inefficiency. The star rating of hotels
aims to harmonize international standards with the objective of differentiating and improving
hotel facilities and services. Some studies were conducted to compare the efficiency of star
rating in hotels. Oliveira, Pedro and Marques (2013) present a study examining the efficiency of
Portuguese hotels by disaggregating them according to a set of criteria, including typology of
hotels, location in the Algarve, ownership of golf course, and as owners of one or more hotels.
They found that in general, five-star hotels were more efficient than four-star hotels. In contrast,
Chen (2007) states that although the efficiency differences between four-star hotels are greater,
as a group, they perform better than five-star hotels in Taiwan. Recent research has emphasized
the importance of the environment for the tourism activity and its development. This is not
surprising given that the hotel industry also plays a major role in contributing to environmental
sustainability due to its significance in the tourism industry. Most studies analyze determinants
of hotels’ environmental activities. Stakeholders, environmental legislation and the availability
of resources and capabilities to implement a proactive environmental management are
considered relevant to environmental decision-making and actions.
Kasim (2007) discusses the theoretical drivers of and barriers to corporate environmentalism and
find that more hotel owners and shareholders need to accept and deal with environmental issues.
Along similar lines, Lopez-Gamero,
Ahmad (2014) analyzes the determinants and characteristics of the owner-managers of small-
and medium-sized hotels and identifies various challenges in starting up and operating
businesses in the United Arab Emirates. This research provides a useful insight into the activities
in the hotel tourism business sector and the challenges encountered while operating in the United
Arab Emirates economy.
The study by Xiao, O’Neill and Mattila (2012) concludes that there are corporate effects in the
hotel industry. Their findings indicate that corporate strategies can be effective sources of
corporate effects, because a hotel owner can influence its portfolio through implementing certain
corporate strategies; however, the degree of importance varies according to the strategy.
Davidson and Sahli (2014) explore tourism foreign direct investment and poverty alleviation
through both the literature and a detailed analysis in Gambia of the relative contribution of
foreign versus locally owned hotels to development and poverty alleviation. The study provides
empirical evidence of the relative characteristics, performance, and benefits of foreign
investments, and it suggests that the advantages and disadvantages for poverty alleviation of
different forms of hotel ownership are complex. In the category of financial structure, studies
analyze the capital structure as the most important determinant of growth of hotel firms.

Local Studies
Parte Esteban and Such Devesa (2011) focused on reported earnings and demonstrate the
importance of reaching certain earnings benchmarks in the Spanish hotel industry. The authors
found that while the managers’ motivation to avoid small losses remains open to speculation,
they clearly have at least some ability to manipulate profit and earnings figures. This is one of
the first papers to analyze earnings management in the hotel industry and is a first step to giving
this area special attention. The second study analyzes the influence of firm characteristics on
earnings quality (Parte Esteban & García, 2014). The authors suggest that characteristics such as
internationalization, the location, the ownership structure and audit function influence earnings
quality in Spanish hotel firms.
Patiar and Mia (2009) analyze the relationship between financial and non-financial
performance, market competition and transformational leadership style of hotel departments. The
authors propose that a transformational leadership style was associated with the non-financial
performance which, in turn, was positively associated with the financial performance of
departments

Sharma and Upneja (2005) investigate the operational factors that affect the financial
performance of small hotels. They find that both micro level factors such as employee training,
investment in equipment, and macro level factors, such as institutional environment and product
service standardization system have an impact

Molina-Azorín and Claver-Cortes (2011) analyze the antecedents of hotel managers’

environmental attitudes to check whether perceptions of the external and internal factors are
behind the adoption of a proactive environmental management. They found that the attitude and
perceptions of managers appear to be essential factors for the investment in proactive
environmental technologies.
Existing System

The existing system for accounting management on its cash receipt and disbursements both
needed improvement while in the receivable, pretty cash fund, debts, and expenditure were all
unsatisfactory. The existing system for revenue was satisfactory. The internal control system
particularly on cash receipts, receivable, debts, revenue, and expenditures needed improvements.
The internal control for cash disbursements and pretty cash fund were both unsatisfactory. The
existing system for management on its cash receipts, cash disbursements, receivable, debts,
revenue and expenditure were assessed to be the strength in the current existing practices on fund
and revenue management of Touch & Go. The internal controls system installed on fund and
revenue management system particularly on cash receipts, disbursement, pretty cash fund,
receivable, debt, revenue, and expenditure were also considered as the strength of the institutions
current controls practices on fund and revenue management system. The current system of Touch
& Go About accounting management system. concentration banking to fasten the collection
scheme; the credit function of the institution separated from the revenue function; establishment
of adequate allowance for probable losses from delinquent accounts; write off of delinquent
accounts thru approval by the board of trustees; procedures of probable future collection from
written of accounts; pre-numbered documents used for billing; written procedures regarding the
recording and reconciliation of revenue generating transactions; procedures to ensure that fees
billed are adequate to recover all direct and indirect cost; the person responsible to the
account/notes receivable is independent from the credit manager; preparation of cash budget that
begins at least six months before the beginning of the next fiscal/calendar year; preparation of
the budget that involved all the individuals.
References:
http://www.na-businesspress.com/JABE/tarigan_abstract.html

https://pdfs.semanticscholar.org/ef21/6835fb6629b2b150503ef5bb20bffe175203.pdf

https://www.sciencedirect.com/science/article/abs/pii/S0278431917301263?via%3Dihub

http://openscholar.dut.ac.za/handle/10321/2426

https://eric.ed.gov/?q=accounting+department+local+literature&ft=on&id=ED566853

https://www.scribd.com/document/290500157/Local-Literature

https://doi.org/10.1016/j.ijhm.2017.02.001

https://www.researchgate.net/publication/312440166_Research_in_hospitality_management_and_acc
ounting_A_research_synthesis_and_analysis_of_current_literature_and_future_challenges
https://repositorio.iscte-iul.pt/handle/10071/12862

Atkinson, A., Kaplan, R., Matsumara, E. and Young, M. (2012). Management Accounting:
Information for Decesion-Making and Strategy Execution, 6th ed., Pearson Education Ltd.,
England.
Carter, W. (2007). Cost Ac Philippine Statistics Authority (2017 Statistical Figure, Factor
analysis Report, [Accessed 5th June 2018] Available from the World Wide Web:
http://openstat.psa.gov.ph/search/field_topic/industry-trade-and-services9. counting, 14th ed.,
Thomson Learning, Singapore, Asia.

Atkinson et al. (2012) Management Accounting: Information for Decision-Making and Strategy
Execution, (6th ed.), Pearson Education Ltd., England

Jawabreh, O.A.A ve Alrabei, A.M.A. (2012). “The Impact of Accounting Information System in
Planning, Controlling and Decision-Making Processes İn Jodhpur Hotels”, Asian Journal of
Finance & Accounting, 4(1), s. 173-188. Proceedings of the Middle East Conference on Global
Business, Economics, Finance and Management Sciences (ME17Dubai May Conference) ISBN:
978-1-943579-09-9 Dubai, UAE. 27-28, May 2017. Paper ID: DM739