USALI, 12th Revised Edition: is Your Finance Team Ready for January 2026?

“Tomorrow is often the busiest day of the week.” –Unknown Author

Mark your calendars, if you haven’t already circled January 1, 2026, in red ink, you should grab that pen now. What is so important about this date? This first day of January is when the hospitality industry will welcome a new financial reporting standard with the 12th Revised Edition of the Uniform System of Accounts for the Lodging Industry (USALI), taking effect. The new revised USALI framework, brought to you by Hospitality Financial and Technology Professionals (HFTP) and the American Hotel & Lodging Association (AHLA), will bring enhanced comparability, transparency, and deeper financial insight to lodging operations. For finance teams who have not yet begun their preparation, it’s not too late. However, implementation planning needs to become a priority.

Whether you are a hotel owner, operator, asset manager, or legal advisor, preparing for the USALI, 12th Revised Edition requires more than a simple update to your accounting software. It calls for a thoughtful, collaborative team strategy that aligns financial reporting with operational realities and contractual obligations.

Why Early Adoption Matters

The USALI, 12th Revised Edition introduces a more refined and globally aligned framework, incorporating changes that reflect evolving business models, sustainability practices, and digital marketing strategies. By transitioning early, hotels can:

• Benchmark more effectively against competitors who have already adopted the new standards.

• Avoid dual reporting complexities during the transition period.

• Gain clearer insights into departmental performance and cost allocations.

• Ensure contracts and agreements reflect the latest definitions and schedules.

In short, early adoption positions an organization to lead rather than lag in financial clarity and operational accountability.

Transitioning to the 12th Revised Edition

How do you prepare for the transition to the new edition of USALI? Below are some recommended steps.

1. Conduct a Gap Analysis

Begin by comparing your current financial reporting structure under the 11th Revised Edition (or your current framework) with the requirements of the USALI 12th Revised Edition. Identify areas where new schedules, line items, or definitions will impact your reporting. Pay close attention to changes in departmental classifications, revenue recognition methods, expense allocation procedures, and brand or operator costs that may require adjustments to your existing processes. This analysis will help you prioritize updates and allocate resources effectively.

2. Engage Cross-Functional Teams

Transitioning to the USALI, 12th Revised Edition is not just an accounting task, it affects operations, legal, IT, and asset management. Form a working group that includes representatives from each area to ensure alignment. Legal teams, for example, should review management agreements to ensure terminology and cost allocations reflect the new framework. Similarly, IT teams may need to reconfigure property management systems (PMS) and financial reporting software to accommodate new departmental schedules and line items introduced in this edition.

3. Update Systems and Templates

Accounting systems, reporting templates, and dashboards will need to be reconfigured to accommodate new schedules and classifications. Finance and IT teams need to work together to ensure systems can support the USALI 12th Revised Edition’s structure. This includes adding new line items for digital marketing expenses, loyalty program benefits, and sustainability metrics.

4. Train Your Teams

Education is key, host training sessions for finance, operations, and legal staff to familiarize them with the changes. Use real-world examples to show how the new framework affects reporting, budgeting, and performance evaluation. Consider using some of the courses offered by the HFTP Academy or resources found on the USALI website.

5. Review and Revise Contracts

Many hotel management and asset agreements reference the USALI explicitly. Legal teams should review these documents to ensure they align with the 12th Revised Edition. This includes updating definitions, clarifying cost-sharing mechanisms, and ensuring that performance metrics are based on the new reporting standards.

6. Pilot the New Framework

Before full implementation, consider running a pilot using the USALI 12th Revised Edition for one property or reporting period. This allows you to test systems, identify issues, and refine processes without disrupting your entire portfolio.

7. Communicate with Stakeholders

Transparency with owners, investors, and brand partners is essential. Communicate your transition plan, timeline, and rationale for early adoption. Highlight how the new framework enhances financial clarity and supports strategic decision-making.

What If You’re Not Ready by January 2026?

While the USALI 12th Revised Edition becomes effective in 2026, there is flexibility in the timeline. Some organizations may need more time due to system limitations, staffing constraints, or contractual complexities. However, delayed implementation can create challenges in benchmarking, investor reporting, and internal analysis.

If a full transition is not feasible by January, consider a phased approach. Begin by adopting key schedules or classifications that have the most impact, such as the new departmental structures or digital marketing expenses. This allows for building momentum while minimizing disruption.

Final Thoughts

The move to the USALI 12th Revised Edition is more than a compliance exercise, it is an opportunity to modernize financial reporting and strengthen operational transparency. By preparing early and engaging the right teams, hotels can ensure a smooth transition.

Arlene Ramirez

Arlene Ramirez, Ed.D., Senior Vice President of Learning for HFTP, has over 25 years of hospitality finance experience. She brings extensive expertise in various segments of hospitality business operations to her role. Her financial background from the corporate and property level proves invaluable in designing relevant educational content for HFTP’s community of finance and technology professionals. Dr. Ramirez was also a faculty member at the Hilton College of Global Hospitality Leadership, allowing her to effectively bridge theoretical concepts with practical applications in HFTP’s educational initiatives. Connect with Arlene on LinkedIn.

She holds a doctorate in Instructional Systems Design and Technology and an MBA from Sam Houston State University, a BBA in Accounting from the University of Texas at Austin, and industry certifications including CHAE, CHE, CHIA, and CAHTA. She is a frequent author and speaker at hospitality industry events.