When you run the Operating Statement for Owners report in Inn-Flow, you will see three columns for each reporting period: Actual, Adjusted Budget, and Original Budget. The Adjusted Budget (also called a flexible budget) recalculates budget figures based on your property's actual occupancy and revenue, rather than using the static numbers entered during the annual budgeting process. This makes it a more meaningful comparison to actuals, especially when occupancy deviates from what was originally forecasted.

The Original Budget is the static budget entered on the Operational Budgets page during the annual budgeting cycle. The Adjusted Budget takes those same budget inputs (rates, percentages, per-room costs) and recalculates them using actual occupancy and revenue data. A Forecast, by contrast, is a separate forward-looking projection that may be updated periodically and appears on different report views such as the Operating Statement Actual & Forecast.

The formula depends on the budgeting method assigned to each account on the Operational Budgets page. Inn-Flow supports five methods:

For all revenue accounts, the Adjusted Budget is replaced by the actual revenue figure. This means the Adjusted Budget column for revenue always equals the Actual column. The purpose is to use real revenue as the baseline so that expense ratios are measured against what was actually earned.

Adjusted Budget $ = Actual Revenue

The original budget stays as-is regardless of occupancy. These are costs that do not change with volume – things like loan interest, property taxes, insurance premiums, fixed management fees, and elevator maintenance contracts.

Adjusted Budget $ = Original Budget Amount

The budgeted cost per room is multiplied by the actual number of rooms sold during the period. This method is used for variable expenses that scale with occupancy, such as room supplies, guest amenities, and laundry chemicals.

Adjusted Budget $ = Budgeted Rate Per Room x Actual Rooms Sold

This method is for hourly labor accounts where the budget is based on minutes per occupied room. Inn-Flow calculates expected labor cost using the hourly rate, minutes per room, and actual rooms sold. Common examples include room attendant wages, laundry attendant wages, and houseperson wages.

Adjusted Budget $ = (Hourly Rate x Minutes Per Room x Actual Rooms Sold) / 60

A set percentage is applied to the actual revenue of a linked account. This method is used for expenses like franchise advertising fees, e-commerce charges, management fees, credit card fees, and payroll tax estimates.

Adjusted Budget $ = Actual Revenue of Related Account x Budget Percentage / 100

The % columns on the report show each line item as a percentage of the adjusted budget target. The formula is:

Adjusted Budget % = Actual $ / Adjusted Budget $ x 100

Important: The Adjusted Budget % uses the Actual dollar amount in the numerator, not the Adjusted Budget dollar amount. This is intentional – it tells you what percentage of the adjusted target you actually achieved. A value over 100% for an expense line means you overspent relative to the flexible budget.

Each section of the Operating Statement for Owners displays three sub-columns for both Current Period and Year-To-Date:

Q: Why does my Adjusted Budget for revenue match the Actual column exactly?A: This is by design. Revenue accounts use actual revenue as the Adjusted Budget baseline so that expense ratios are calculated against real performance.

Q: My Adjusted Budget % for an expense line is over 100%. What does that mean?A: It means you spent more than the flexible budget allowed for the actual level of business. This signals an area worth investigating.

Q: Why is my Adjusted Budget different from the Original Budget even though occupancy was close to forecast?A: Even small occupancy variances cause POR and Hourly Wage method accounts to flex. Percent Method accounts also adjust if actual revenue differs from budget, even when room count is similar.

Q: Where can I see which budget method is assigned to each account?A: Go to the Operational Budgets page in Inn-Flow. The Budget Method column shows the method assigned to each GL account.