Management accounting as a condition for credit: what changes for Italian hotels in 2026
The meeting is set for a Wednesday morning. The hotelier arrives with the folder: the last two sets of accounts, the company search, the builder’s quote for refurbishing twelve rooms and replacing the boiler. The project is sound, the hotel is trading, last summer’s occupancy was the best in five years. Across the table, however, the request is a different one: the plan for the next two years, the forecast of receipts and outgoings, the cash budget month by month. Not yesterday’s numbers. Tomorrow’s.
This is where the conversation stalls. Not because the hotel is doing badly, but because the only economic document the business produces regularly is a set of statutory accounts drawn up for tax purposes and filed many months after the year end. A document that describes a now-distant past with great precision, and says nothing about what the bank actually cares about: whether this business will be able to pay the instalments in the months ahead.
That mismatch — which until a few years ago was resolved by the branch manager’s personal knowledge of the borrower and by a charge over the property — has become structural. And in 2026 it stopped being merely a matter of banking practice.
What changed in the spring of 2026
At the end of April a reform of Italian company law came into force — Legislative Decree no. 47 of 2026, implementing the so-called Capital Markets Act — rewriting a substantial part of the rules governing companies. There is no transition period: it applies immediately.
In practical terms, the reform says two things that matter to anyone running a hotel business in Italy.
The first: organising the business is not a side activity of the people who run it, it is part of the job. The Civil Code now states expressly that directors are responsible for managing the company and for organising it, including building what the legal language calls an adequate organisational, administrative and accounting structure. Stripped of the formula, it means one thing: having procedures, roles and numbers that let you know how the business is doing while it is doing it, not a year later.
The second: whoever is charged with overseeing the directors — the board of statutory auditors, where one is required — must check not only that the structure exists on paper, but that it actually works. It sounds technical and is in fact decisive, because it shifts attention from the document to the use of the document. A budget printed in January and never opened again is not an adequate structure. Until this reform, an oversight duty of this kind applied only to listed companies.
It should be added, in fairness, that the reform is not free of grey areas: it was designed largely on the model of the joint-stock company, and practitioners are still debating how some of its provisions sit alongside the rules governing the S.r.l. — which is, after all, the legal form of most established Italian hotel businesses.
Who exactly is subject to the obligation
A distinction is needed here that matters more in our sector than elsewhere, because independent Italian hospitality is made up of very different legal forms.
The obligation to maintain an adequate administrative and accounting structure — introduced in 2019 by the Insolvency and Business Crisis Code — applies to anyone carrying on business in corporate or collective form. So limited companies, but also partnerships, the commonest form among family-run hotels. Strictly speaking it does not apply to the sole trader: of them the law requires “suitable measures” to notice difficulty in good time and react immediately.
The difference is more one of wording than of substance. And above all, both provisions rest on a principle worth keeping in mind before taking fright: proportionality. The structure must be adequate to the nature and size of the business. No rule asks a thirty-room hotel for the control system of an international chain. It asks that there be something, and that the something be good for something.
The ruling that changed the climate in credit assessment
In March 2026 the Italian Supreme Court handed down a decision — order no. 7134 — that has been much discussed. The facts: in 2020 a bank had granted two state-guaranteed loans to a business that, on paper, was not yet in a formal procedure, but whose accounts were already severely compromised. When the business failed, the bank applied to be admitted to the list of creditors and was refused.
The numbers tell the story better than any commentary. The last set of accounts the bank had used in its assessment showed debts of more than six hundred and thirty thousand euro against net equity of little more than nineteen thousand: a ratio of roughly 34 to 1, when those subsidised measures could not be granted above a ratio of 7.5. The Court found against the bank, declaring the two loans void and — this is the point that alarmed the credit system — holding that the sums advanced are not even recoverable.
One clarification is needed here, one that many of the commentaries circulated in the following months skipped. The ruling penalises the bank, not the business. The principle concerns the liability of whoever finances an already insolvent company, worsening its position and delaying the moment the collapse comes to light. Reading it as though it established that a business without management accounting is “unbankable” overstates it: that is a reasonable practical consequence, argued by many practitioners, not a rule written by the Court.
The practical consequence does exist, though, and it is a heavy one. If getting an assessment wrong can cost a bank the whole of the capital advanced, the assessment becomes structurally more demanding. And that demand falls entirely on the information the business is able to put on the table.
What the bank asks for, and why it looks like an internal control system
The list of documents lenders request is neither improvised nor arbitrary. It follows from the European Banking Authority’s guidelines on loan origination and monitoring, which for small and medium-sized enterprises set out fairly precisely what to gather: what the loan is for and with what evidence, the accounts, an aged debtors listing, a business plan, financial projections, the position on tax debts and any arrears, pending litigation, security.
Look at that list with the jargon removed and one thing emerges: it is the description of a business that keeps its own accounts under control. The bank is not asking for documents over and above those the law already assumes exist. It is asking to see them.
A paper published in 2023 by the Italian national body of chartered accountants together with its research foundation points the same way, addressing precisely how SMEs should present themselves to banks. The invitation is to a cultural change: realistic forecasts, built on credible assumptions, accompanied by constant monitoring of the variances between what was forecast and what happened.
Among the indicators that paper flags as relevant in the dialogue with lenders, one deserves more attention than the others: the DSCR. The acronym stands for debt service coverage ratio, and it measures something simple — how many times over the cash the business generates in a period covers the debt instalments it has to pay in the same period. If the value is 1, the cash covers the instalments exactly and nothing is left. In banking practice a value at or above 1.1 is generally considered adequate, that is, with a minimum safety margin.
The crucial point is how that number is arrived at. The DSCR is not read off last year’s accounts: it is calculated on cash flow forecasts. Anyone without a treasury budget does not have a DSCR, they have an estimate built after the fact — and the bank is perfectly capable of recognising it for what it is.
Italian courts have been moving in the same direction for years: a number of first- and second-instance decisions have identified precisely the cash budget, forecasting tools, periodic reporting, a business plan and an orderly procedure for keeping receivables under control as the elements that make a company’s administrative structure adequate.
How widespread is all this? An analysis by Unioncamere of 2023 financial statements found traces of these tools being adopted in something around 3.5% of companies. The figure should be treated with caution, because it measures the presence of explicit references in the filed accounts rather than actual adoption: many well-run businesses do not write it down, and some that write it down are not. Even allowing a wide margin of error, the order of magnitude remains eloquent.
Why the problem is harder for a hotel — and more interesting
So far the argument holds for any Italian business. Applied to a hotel, though, it has three specific features that need addressing head-on, because they are exactly the points where the standard tools work worst.
Seasonality distorts annual figures. A DSCR calculated over the full year can look reassuring while completely hiding the months in which the property takes nothing and goes on paying wages, utilities, mortgage instalments and taxes. For a business that invoices evenly across the year, the annual figure is a good approximation. For a mountain or seaside hotel it is the average of a full half-year and an empty one — and the average does not pay November’s instalments. A hotel’s cash budget, to be useful to itself before it is useful to the bank, has to be built month by month, and read by looking at the low points, not the total.
When you sell is not when you get paid. Between the booking, the stay, the OTA payout net of commission and the invoice to a group that pays in sixty days there are intervals that differ from one another and differ by channel. A cash budget that ignores that lag produces tidy, wrong numbers. It is also why reconciling commercial data with accounting data is not a back-office detail: it is the condition on which the forecasts hold up when someone challenges them.
Without a departmental P&L you cannot tell where the money is made. A positive overall margin can sit quite comfortably alongside a structurally loss-making restaurant, a spa that absorbs staff and energy without earning enough, a sales channel that costs more than it brings in. Attributing revenue and direct costs to each department before arriving at the bottom line is the logic the industry’s international accounting standard is built on, and you do not need a chain’s infrastructure to apply it in simplified form. You need a decision: to stop reading the hotel as a single block.
It is worth adding that this is not only about ordinary mortgages. The subsidised instruments dedicated to the sector — the special “tourism” section of the SME Guarantee Fund and the revolving fund for tourism businesses, both aimed at hotels, farm stays, campsites and the tourism sector more generally — reduce the bank’s risk, but they do not replace the credit assessment. The assessment remains. And after the March 2026 ruling the bank has more reason to conduct it rigorously.
Conclusions
The sequence of the past few months has a logic to it. The April 2026 reform made organising the business an explicit duty of those who run it, and extended to companies generally an oversight that previously applied only to listed ones. The Supreme Court significantly raised the price a bank pays for lending without really looking. The European guidelines, by now firmly embedded in credit assessment practice, have for years described a set of documents that coincides with those of a business that controls itself.
The practical point for an independent hotelier is therefore not about complying with a formality. It is about realising that management accounting has become the language in which the credit system asks to be addressed, and that anyone who does not speak it negotiates at a disadvantage — when they get to negotiate at all.
You do not need to start with a complete apparatus. Two things answer more questions than anything else: a month-by-month cash budget that reflects the property’s real seasonality, and a departmental P&L that shows where the margin is made and where it is consumed.
It is then the same information you need in order to decide whether to refurbish the rooms, whether to keep the restaurant open in November, whether to accept that discounted group contract. The bank asks for it because it is useful. Not the other way round.
Frequently asked questions
Is a hotel run as a sole trader required to have management accounting in place? Not in the form required of companies: the Civil Code obligation applies to those carrying on business in corporate or collective form. The Insolvency and Business Crisis Code nonetheless requires the sole trader to adopt suitable measures to notice difficulty in good time. The wording is lighter; the information needed is substantially the same.
Do partnerships fall within the obligation? Yes. The provision applies to entrepreneurs operating in corporate or collective form, and that includes partnerships, which are very common among family-run properties.
Does the 2026 reform also apply to small S.r.l. companies? The new rules on directors’ duties apply to limited companies regardless of size. The reform is, however, built mainly on the joint-stock company model, and on some aspects of its application to the S.r.l. the debate among practitioners is still open.
Does the 2026 Supreme Court ruling establish that finance cannot be obtained without management accounting? No. The decision concerns the liability of a bank that extends credit to a business already in serious distress, and declares the loans void. The reading according to which a business lacking an adequate accounting structure would be “unbankable” is an interpretation of the practical consequences, not a principle stated by the Court.
What is the DSCR and what value is considered acceptable? It is the ratio between the cash the business generates in a period and the debt instalments payable in the same period. In banking practice a value at or above 1.1 is generally considered adequate. It is calculated on cash flow forecasts, not on the final statutory accounts.
Why can the annual DSCR be misleading for a seasonal property? Because an average calculated across the whole year can come out positive even where there are months with no receipts and unchanged fixed costs. Monthly calculation makes it possible to identify the cash low points, which are what really determines the ability to pay the instalments.
How many tools does a small hotel need before its structure is considered adequate? There is no mandatory list, because the law reasons in terms of proportionality to the size and nature of the business. The courts have, however, fairly consistently identified the cash budget, forecasting tools, periodic reporting, a business plan and an orderly procedure for monitoring receipts as recurring components.
A note on sources. The legal framework is reconstructed from the text of Legislative Decree no. 47 of 27 March 2026, implementing the delegation under Law 21/2024, and from the provisions of the Italian Civil Code (in particular arts. 2086(2), 2380-bis and 2396-quinquies) and of the Insolvency and Business Crisis Code as amended or referred to by it. The case-law reference is to the order of the Italian Supreme Court, First Civil Division, 25 March 2026, no. 7134, and to the professional commentary on its implications for businesses’ obligations. The credit assessment guidelines are those of the European Banking Authority, EBA/GL/2020/06. The financial indicators cited are drawn from the research paper of the CNDCEC and the Fondazione Nazionale dei Commercialisti on financial reporting and SME bankability (November 2023). The figure on the take-up of adequate organisational structures comes from a Unioncamere analysis of the notes to 2023 financial statements and measures the presence of explicit references, not the actual adoption of the tools. The credit support measures for the tourism sector are described on the basis of the documentation of the SME Guarantee Fund and the Italian Ministry of Tourism.
This article is for information only and does not constitute legal, accounting or financial advice. The April 2026 reform is recent, and on some aspects of its application the debate among practitioners is still open; the order cited decides a specific case and does not in itself amount to settled case law. You are advised to check the instruments in their official versions and to consult your accountant or a lawyer before taking decisions on your property’s administrative structure or on a finance application.