Hotel Deposit Reconciliation
Hotel deposit reconciliation software that tracks every advance deposit from collection through application, refund, or forfeiture — and ties the open total to the GL each period.
- less time on deposit tracking
- 75%less time on deposit tracking
- of deposits traced to outcome
- 100%of deposits traced to outcome
- unidentified deposits at month-end
- 0unidentified deposits at month-end
Track every deposit from collect to outcome.
Terrace ingests advance deposits, reservation status, cancellation policies, and refunds, then reconciles every deposit from collection through application or refund. Open deposits no longer linger without an owner.
- Deposit sub-ledger tied to GL each period
- Application at check-in verified
- Cancellation policy applied automatically
What is hotel deposit reconciliation?
Hotel deposit reconciliation is the end-to-end tracking of advance deposits and prepayments — from collection at booking time, through application against the folio at check-in, refund under cancellation, or forfeiture per policy — and the period-end tie-out of the open deposit total against the deposit liability account on the GL.
Because deposits sit on the books for weeks or months between collection and outcome, and because the liability account grows continuously with new collections, hotel deposit reconciliation requires both per-transaction tracking and aggregate balance reconciliation. Hospitality deposit reconciliation software like Terrace AI handles both: tracking each deposit from collection through outcome and reconciling the total to the GL every period.
- Deposit sub-ledger ties to GL liability
- Every deposit traced to outcome
- Application at check-in verified
- Cancellation policy applied
- Refunds tie to original tender
- Aged deposits surfaced for resolution
Why hotel deposit reconciliation is painful for accounting teams
Deposits sit on the books for weeks or months
Advance deposits are collected at booking time but may not be applied or refunded until weeks or months later, requiring careful tracking.
Group deposits arrive in lumps
Sales-led group bookings often pay deposits as lump sums against a contract, which must be applied across individual reservations at check-in.
Cancellations create policy-driven outcomes
Cancelled reservations may forfeit deposits, partially refund, or move to a future stay, depending on policy and timing.
Liability account grows over time
The advance deposit liability account on the GL grows as deposits are collected and only reduces when deposits are applied or refunded — and the balance must tie to the PMS sub-ledger every month.
Deposits collected via OTAs are virtual
OTA bookings paid via virtual credit card can create a deposit-like obligation that must be reconciled against eventual settlement.
Stale deposits with no clear owner
Aged deposits without a clear booking, refund, or forfeiture path linger on the books and inflate the liability balance.
What data is matched in hotel deposit reconciliation?
- Deposit ID
- Reservation
- Amount
- Collected
- Status
- Arrival
- Cancellation
- Folio
- Deposit applied
- Amount
- Original deposit
- Refund amount
- Tender
- Forfeit rules
- Cutoff
- Penalty
- Account
- Balance
- Postings
Common hotel deposit reconciliation exceptions
A guest checked in but the matching advance deposit was not applied to the folio, requiring manual application.
A reservation was cancelled but the associated deposit was neither refunded nor forfeited per policy.
A partial refund of a deposit was issued to a different card or tender than the original deposit.
An advance deposit was applied to a different folio than the reservation it was collected for.
The deposit liability account on the GL does not equal the open deposit total on the PMS sub-ledger.
An open deposit balance has aged beyond a threshold with no live reservation, refund, or forfeiture on record.
How hotels manually reconcile deposits
- 1
Pull the advance deposit sub-ledger from the PMS for the period.
- 2
Pull the deposit liability account balance from the GL.
- 3
Tie sub-ledger total to GL balance and investigate any variance.
- 4
Pull the reservation log and confirm each open deposit has a live reservation.
- 5
Identify deposits that should have been applied at check-in but weren't.
- 6
Apply cancellation policy to cancelled reservations and process forfeitures or refunds.
- 7
Pull the refund register and confirm refunds tie to the original deposit tender.
- 8
Document aged deposits and route them to appropriate owners for resolution.
Automated hotel deposit reconciliation with Terrace AI
Terrace tracks every deposit from collection through outcome, applies cancellation policy automatically, and ties the deposit sub-ledger to the GL each period.
Sub-ledger tie
Deposit sub-ledger to GL tie-out
Terrace ties the PMS advance deposit sub-ledger to the deposit liability account on the GL every period.
Application check
Application at check-in verification
Every deposit collected for a reservation is verified to be applied to the correct folio at check-in.
Cancellations
Cancellation outcome handling
Cancelled reservations are evaluated against rate plan and contract policy to apply forfeitures, refunds, or rebookings automatically.
Refund matching
Refund-to-deposit matching
Refunds are matched back to the original deposit and verified to go to the same tender or to an approved alternate.
Group deposits
Group deposit allocation
Group block deposits are allocated against individual reservations as guests check in, with the audit trail attached.
Aging insight
Aged deposit surfacing
Deposits that age beyond policy thresholds without resolution are surfaced for ownership and follow-up.
Put hotel revenue on autopilot
From OTA statement to GL posting — faster cash, accurate books, and less manual reconciliation.
Frequently asked questions
Hotel deposit reconciliation is the process of tracking every advance deposit and prepayment from the moment it's collected through to its application against a folio, refund to the guest, or forfeiture under cancellation policy — and reconciling the open deposit total against the deposit liability account on the GL each period.
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