![]() Owned and Leased Units: We recognize room sales and revenues from other guest services for our owned and leased units when rooms are occupied and when we have rendered the services.Ĭost Reimbursements: We recognize cost reimbursements from managed, franchised, and licensed properties when we incur the related reimbursable costs. In interim periods and at year-end, we recognize incentive management fees that would be due as if the contracts were to terminate at that date, exclusive of any termination fees payable or receivable by us.įranchise Fee and License Fee Revenue: We recognize franchise fees and license fees as revenue in each accounting period as we earn those fees from the franchisee or licensee under the contracts. Cost reimbursements include direct and indirect costs that are reimbursed to us by properties that we manage, franchise, or license.īase Management and Incentive Management Fees: We recognize base management fees as revenue when we earn them under the contracts. Franchise fees are typically composed of initial application fees and continuing royalties generated from our franchise programs, which permit the hotel owners and operators to use certain of our brand names. ![]() ![]() Management fees are typically composed of a base fee, which is a percentage of the revenues of hotels, and an incentive fee, which is generally based on hotel profitability. Our revenues include: (1) base management and incentive management fees (2) franchise fees (including licensing fees from MVW after the spin-off of $59 million for 2015, $60 million for 2014, and $61 million for 2013) (3) revenues from lodging properties we own or lease and (4) cost reimbursements. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Revenue Recognition ![]()
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