The folio is the running account of a stay: every charge and every payment, in order. The invoice is the legal document issued from it. Confusing the two is the root of most billing problems at hotels.
Folio basics
| Line type | Example |
|---|---|
| Room charge | Double room, 12 Oct, EUR 115 |
| Tax | City tax, 2 persons x EUR 3 |
| Extra | Minibar EUR 12, parking EUR 20 |
| Payment | Card deposit EUR 115 |
| Adjustment | Discount on late room, -EUR 15 |
Balance = charges - payments. A folio with a non-zero balance at check-out is either money to collect or money to refund.
Splitting folios
One stay can need more than one folio:
- ●Company pays the room, guest pays extras. Two folios, charges routed by type.
- ●Two guests share a room and split the bill. Two folios, room charge split 50/50.
- ●Group master folio. Room and breakfast for all group rooms on one folio for the organiser.
Route charges when they are posted, not at check-out. Moving lines between folios at 7:00 AM with a queue at the desk is where errors come from.
From folio to invoice
- Check the balance is zero (or the rest goes on account to a company).
- Check the billing details: company name, address, VAT or tax number.
- Issue the invoice: it takes the next number in the series for the year and can no longer be edited.
- Send it and keep it.
Why invoices are immutable
In most countries an issued invoice cannot be edited or deleted, and the numbering must be continuous with no gaps. A gap (INV-2026-0141 followed by 0143) is exactly what a tax audit looks for. That is why a PMS should assign the number at issue, atomically, and lock the document.
Fixing a mistake: the credit note
Wrong amount, wrong company, wrong VAT number: the invoice is not edited. A credit note cancels it (fully or partly) with its own number, and a new correct invoice is issued.
| Document | Number | Amount |
|---|---|---|
| Invoice (wrong company) | INV-2026-0141 | EUR 460 |
| Credit note | CN-2026-0012 | -EUR 460 |
| Invoice (correct) | INV-2026-0142 | EUR 460 |
The trail shows exactly what happened, which is what an accountant or an auditor wants to see.
Month end
Export the invoice list (number, date, customer, taxable amount, tax, total) as CSV for the accountant. If the export has gaps or a different total from the PMS revenue report, find out why before the accountant does.
FrontDesk issues numbered invoices from the folio with a series per year, locks them on issue, supports credit notes and exports the invoice list as CSV with the fiscal data.
Simple hotel property management software for independent hotels, chains and groups.