Innovative Accounting for Bali Tourism: What the Research Says

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- 8 minutes read - 1644 words

Tourism is the backbone of Bali’s economy. It is a main source of regional revenue and a major employer, and it supports a wide range of small businesses, from family warungs to tour operators and village tourism groups.

A 2025 paper by researchers at Warmadewa University in Denpasar asks a simple question: what role should accounting play in managing that industry well?

This article summarises what the paper found, and adds a practitioner’s view of what it means for tourism businesses in Bali today.

About the paper

“Innovative Accounting for Bali Tourism Management and Competitiveness”, by Ni Made Nadia Adina Putri, Desak Ketut Juliani, Ni Putu Eprilia Kumlasari, Ni Putu Rahayu Pradnyani, and Ni Nyoman Dini Pratiwi (Accounting Study Program, Faculty of Economics and Business, Warmadewa University). It was published in the Journal of Tourism Economics and Policy, Volume 5, Number 2 (2025), pages 267–273, under a CC BY-NC 4.0 license.

The study is qualitative and descriptive. The authors reviewed academic literature and official Bali government documents, including reports from the Bali Provincial Tourism Office, and analysed them by theme. It’s a review of existing evidence rather than a new survey or financial dataset. That makes it most useful as a framework for thinking about tourism finance, not as a source of new numbers.

The paper is organised around four themes.

1. Accountability is the foundation

The authors start with why financial accountability matters so much in Bali.

Tourism is a main source of Regional Original Income (Pendapatan Asli Daerah, or PAD), the revenue the province and regencies raise themselves. Citing the Bali Provincial Government’s 2022 Performance Accountability Report, the paper notes that transparency and accountability in tourism finance contributed to higher tax revenue, especially hotel and restaurant taxes. That revenue strengthens the region’s financial independence and makes public spending more efficient.

The paper also points to the recovery after COVID-19. Bali Central Statistics Agency (BPS) data shows 518,819 foreign tourist visits in June 2024. The authors argue that growth like this needs to be matched by accountable financial management, so that the economic benefit is captured and reinvested sustainably.

Two other points from this section stand out:

  • Accountability reduces leakage. With good accountability, the risk of budget leaks and corruption falls, so funds actually reach infrastructure, promotion, and service quality.
  • Community involvement matters. The paper highlights community participation and the competence of tourism managers as part of financial monitoring, and describes anti-fraud practices rooted in local culture. This is especially relevant to Bali’s village-based tourism.

What this means in practice: for a private business, accountability starts with the basics. Every bill and expense has a record, a reason, and an approval. Tax is calculated and paid correctly. When those basics are in place, the business is easier to audit, easier to lend to, and easier to sell.

2. Management accounting supports better decisions

The second theme is about using accounting for decisions, not just compliance.

The authors draw on Andon and Chua (2007), who found strategic management accounting helps organisations make decisions and manage change, and on Johnson and Kaplan (1987), who showed it gives organisations flexibility in a crisis. The paper argues that tourism businesses need the same tools:

  • Cost analysis, to understand what each product or service really costs.
  • Budgeting and financial planning, including flexible budgets that adjust to activity levels.
  • Performance monitoring, comparing actual results against plan.
  • Cost-volume-profit (CVP) analysis, to understand how changes in occupancy, covers, or bookings affect profit.
  • Activity-based approaches, which assign costs to the activities that actually drive them.

The authors stress that markets change quickly, through new technology, changing guest preferences, and global economic swings. Businesses that analyse their financial position regularly can adjust strategy, manage cash flow, and reduce risk.

What this means in practice: most tourism businesses in Bali have good revenue data from their booking or POS systems. Fewer have reliable cost data. Cost information is what lets you answer questions like:

  • What does each villa really cost to run per night, including maintenance and staff?
  • Is the beverage program profitable after wastage and supplier price changes?
  • At what occupancy does a new property break even?
  • Which tours make money once guide, transport, and entry fees are counted?

These answers depend on costs being recorded promptly, coded to the right property, outlet, or tour, and approved before month-end, not reconstructed from a pile of receipts.

3. Digitalisation makes accounting faster and more transparent

The third theme, and the longest section of the paper, is accounting digitalisation: using computer- or cloud-based software to automate recording, managing, and reporting finances.

The authors identify several benefits:

  • Real-time recording. Ticket sales and operating expenses can be recorded as they happen, and financial reports prepared automatically.
  • Transparency and audit. Digital records are stored neatly and can be accessed at any time for audit or evaluation. This is especially important when public funds or outside investors are involved.
  • Electronic payments. Payment systems such as e-wallets, QRIS, and online payments let tourists pay without cash and let managers see income in real time, reducing the risk of funds going missing.
  • Data integration. Accounting systems can connect with reservation, visitor management, and CRM systems, giving managers a full picture of guest behaviour.
  • Benefits for MSMEs. Micro, small, and medium businesses around tourist destinations often struggle with record-keeping and tax reporting. Digital tools can help them manage finances more professionally.

The paper is also clear about the obstacles:

  • Limited infrastructure, especially internet access in remote areas.
  • Lack of technical skills among managers and business owners.
  • Resistance to change, and concerns about data security.

The authors recommend better internet access and devices, training and mentoring for managers and business owners, and regulation that encourages digital adoption.

What this means in practice: the challenges the paper describes will be familiar to anyone working in Bali. A villa manager in Sidemen or a dive operator in Amed may have patchy internet. Staff may be confident with WhatsApp but not with accounting software. The tools that get adopted are the ones that fit how people already work: taking a photo of a receipt, approving from a phone, and syncing to the accounting system without retyping.

It’s also worth noting that the shift the paper describes is already well under way on the revenue side. QRIS, card payments, and online booking platforms mean income is mostly digital. The cost side, with supplier bills, staff expenses, and cash purchases at local markets, is often still on paper. That’s where the next gains in accuracy and transparency are.

4. Accounting strengthens competitiveness

The final theme connects accounting to Bali’s position in the global tourism market.

The authors argue that:

  • Accurate, transparent reporting builds trust. Tourists choose destinations that are managed professionally, and investors fund businesses whose numbers they can rely on. Clear reporting also helps businesses meet their tax obligations and avoid legal risks that could harm Bali’s reputation.
  • Cost management keeps prices competitive. Bali competes with destinations around the world. Good cost control keeps prices competitive without cutting quality, and frees up money to reinvest in infrastructure, staff, and new products.
  • This shows up in global rankings. The paper links cost management and investment in people to indicators such as the Price Competitiveness Index and Human Resources Index, which matter for attracting international visitors.

The paper gives an example from Bongkasa Village, where a structured accounting and tax system increased tourist confidence while supporting the preservation of local culture and the environment.

What this means in practice: for private operators, “access to financing” is the most concrete benefit. Banks, investors, and buyers ask for reliable financial statements. A villa company that can produce a clean profit and loss for each property, or a restaurant group with accurate food cost by outlet, is in a far stronger position when it wants to raise money or expand.

Key takeaways for Bali tourism businesses

The paper’s conclusion is that financial accountability, management accounting, digitalisation, and good cost management together support a more professional, sustainable, and competitive tourism sector in Bali.

Translated into steps a hotel, villa company, restaurant, spa, or tour operator can take:

  1. Record every cost, not just revenue. Supplier bills and staff expenses should be captured digitally when they happen, not entered at month-end.
  2. Approve spending before it’s paid. A clear approval process, with limits and an audit trail, is the practical form of accountability.
  3. Code costs to where they belong. Assign them to the property, outlet, department, or tour, so management accounting questions can actually be answered.
  4. Use budgets actively. Compare actual costs against budget throughout the month, not just after close.
  5. Choose tools that fit your team. Mobile-friendly, simple tools that work with patchy internet will get used. Complex systems often won’t.
  6. Get the tax basics right. Accurate records make regional hotel and restaurant tax and national tax reporting straightforward.

How ApprovalPro.ai fits in

ApprovalPro.ai was built in Bali, and the challenges in this paper are ones we see around us every day. It covers the cost side of the picture for teams on Xero and QuickBooks Online:

  • Automatic capture of supplier bills and staff expenses, from an upload or a forwarded email.
  • Approval workflows with a full audit trail, so every cost has a record of who approved it and when.
  • Budget checking before spending is approved.
  • Automatic sync to Xero or QuickBooks Online once approved.

For practical guides, see AP automation for Xero in hospitality and tourism and expense claims and reimbursement.

Try ApprovalPro.ai free →

Source: Putri, N. M. N. A., Juliani, D. K., Kumlasari, N. P. E., Pradnyani, N. P. R., & Pratiwi, N. N. D. (2025). Innovative Accounting for Bali Tourism Management and Competitiveness. Journal of Tourism Economics and Policy, 5(2), 267–273. Available on ResearchGate. Licensed under CC BY-NC 4.0. This article is an independent summary and commentary. The “What this means in practice” sections reflect ApprovalPro.ai’s views, not the authors’.