Accessing Financial Management and Property Accounting Performance
Integrating financial management and property accounting can be quite difficult to achieve, leaving most property owners feeling somewhat uncomfortable with the property investment. To feel comfortable with the results of the property investment, the owner needs to have access to important financial documents and should agree with what is reflected in the documents.
As a means of getting all required information on the progress of the investment property, it is a requirement to have a transactions ledger in which every transaction must be entered. Every bill paid should come with some sort of proof (such as a receipt or sales slip) to ensure that the transaction is a legitimate one. The same requirements should also apply in the handling of petty cash as this is where money tends to get lost.
The transactions entered in the ledger should be categorized in the proper manner. For instance, there are income, expense and capital distribution transactions. Each transaction should fall under the correct category to make an evaluation of the investment easier. The balance sheet and the account balances should make an accurate tie-in with all transactions and the bank reconciliation should also be in agreement with the final balance on the balance sheet.
Since it is difficult, if not impossible, to reconcile transactions for the entire year and still manage to come up with the correct figures, it is important for property owners and managers to ensure that the books of accounts are closed out at least once a month. This should fall on a date that is consistent throughout the year to avoid conflicts in items such as rent collections.
The balance sheet and the account balances should make an accurate tie-in with all transactions and the bank reconciliation should also be in agreement with the final balance on the balance sheet. Each transaction should fall under the correct category to make an evaluation of the investment easier. This should fall on a date that is consistent throughout the year to avoid conflicts in items such as rent collections.
All the required compliance reports and payments should be updated on a regular basis. Such reports in property management include things such as payroll, property taxes and any commissions. When all the documents are well-kept and updated, accessing the essential financial information on the property becomes easy. It actually becomes quite simple to tell whether the property performance is achieving its full potential or not. It also helps in coming up with strategies to improve the financial performance of the property in question to increase the profitability.
Ateeya Manzoor is a Managing Director of Mayfair Management Group. She is
a skilled strategic and risk manager and has worked on projects in the technology, legal, hospitality, property development, engineering, oil and gas and professional development industries.
Through her keen eye, Ateeya's core gift is to convert and fully realize potential. She has a unique ability to see things when others may not. Her talent is to anchor in businesses requiring structure or a fresh perspective. Clients value her vision and unrelenting commitment to delivering tangible results.
To get more details, please visit here: https://about.me/AteeyaManzoor