What is USALI? The common language of the hotel P&L
How the Uniform System of Accounts for the Lodging Industry classifies hotel revenue and cost, why departmental profit and GOP are kept apart, and how it works alongside a statutory chart of accounts.
Ask two accountants to report the same hotel and you will probably get two different P&Ls. One books laundry in the rooms department, the other on a separate line. One puts credit card commission under sales, the other under administration. Each is internally consistent; they are simply not comparable.
USALI (Uniform System of Accounts for the Lodging Industry) is the international standard for classifying hotel revenue and expenses under common rules.
What problem does USALI solve?
Comparability. To compare properties within a group, or against industry data, “departmental profit” and “GOP” must mean the same thing everywhere.
Putting responsibility in the right place. USALI assigns costs to the manager who controls them. The rooms manager is responsible for housekeeping labour, not for the building’s insurance. Without this split, managers are held accountable for figures they cannot influence.
A shared language with outside stakeholders. International operators, investors and lenders usually expect to see hotel performance in USALI format.
The basic structure
| Layer | Content |
|---|---|
| Operated departments | Rooms, Food & Beverage, Other Operated Departments (spa, golf, parking and so on), Miscellaneous Income |
| Undistributed operating expenses | Administrative & General, Information & Telecommunications Systems, Sales & Marketing, Property Operation & Maintenance, Utilities |
| Management fees | Fees paid to the operating company |
| Non-operating income and expenses | Ownership-related items such as rent, property taxes and insurance |
Each operated department carries its own revenue and direct expenses; the difference is departmental profit. Subtract undistributed operating expenses from total departmental profit and you get GOP (gross operating profit). Deduct management fees and non-operating items and you arrive at EBITDA.
Do not confuse departmental profit with GOP
Departmental profit = department revenue − the department’s direct expenses GOP = total departmental profit − undistributed operating expenses
Departmental profit measures the department head’s performance. GOP measures the hotel’s operating performance, the result of the general manager and the operating team. Targets and bonus schemes should reflect this deliberately: a department head should not answer for administrative overhead, nor a general manager for ownership costs.
Using it alongside a statutory chart of accounts
USALI is a management reporting standard; it does not replace statutory accounting. In Türkiye, two layers work together in practice:
- The statutory chart of accounts: the Uniform Chart of Accounts, used for tax and official reporting.
- The management reporting structure: USALI-aligned lines that management uses to make decisions.
What connects them is a mapping layer: each statutory account, together with its department, is mapped to a USALI report line. The mapping is set up once; after that, each month’s actuals are reported under the same rule. The accounting team keeps working in its own structure.
In a hotel group this layer matters even more. Properties may use different charts of accounts; mapping brings them onto the same report lines so the consolidated report comes out in one structure.
The template should follow the standard, but belong to you
Every hotel has its own revenue streams: spa, marina, conference centre, water park. USALI groups them under “Other Operated Departments”, but management may need to see each one. The right approach is a backbone that follows the standard, with your own breakdowns underneath. The consolidated report follows the standard; the detail inside each property follows your needs.
Does every hotel need USALI?
If at least two of the following apply to you, a standard structure pays back the setup effort:
- You operate more than one property and want to compare them.
- Department heads are accountable for budgets and results.
- You report regularly to an operator, investor or bank.
- You want to benchmark your position against industry data.
In DRM Budget, USALI-oriented report templates are mapped to each property’s own accounts and departments. Actual, budget, forecast and last year are reported side by side in the same template, and the consolidated report comes out in one structure while each property keeps its own chart of accounts.