Property Accounting-Financial Services

FINANCIAL OPERATIONS

Over the last several years, we have successfully tailored our financial reporting to rival the level of reporting utilized by public companies and the best national real estate firms in the country.  Our transition team of accounting and management professionals plan and implement the project takeover with the highest regard for a seamless transitional period. After a thorough understanding of the project’s needs and requirements from the Owner, the implementation plan for takeover begins.

ACCOUNTING/FINANCIAL REPORTING

The Financial Operations group which is centralized in Casper, Wyoming is managed by a seasoned CPA with over 20 years of experience in Real Estate Related Accounting. The Financial Operations group is a professional, service-oriented team that works closely with Property Management to produce timely, useful, and accurate reports for the owner.  Each accountant is well trained in the state of the art and custom designed YARDI software specifically for real estate management by PM Real Estate Management, Inc.

Our reporting to owners varies based on the needs of the Owner.  We provide a standard reporting package.  Additionally our management team and accounting staff prepare a detailed zero based budget for each project.  Our standard report package includes Balance Sheet, Income and Expense Statements, Cash Flow Operating Statements, 12 month and Rolling 12 Month Operating Statements, and Budget Comparison Reports.    Our accounting group is very flexible and is willing to provide additional reporting outside of the YARDI scope such as reporting requested or required by 3rd party lenders, brokers, etc. We are also able to deliver the reporting package on a date specified by the Owner.

We will account for all the funds and payments made in accordance with our Standard Revenue Policies and Procedures and Accounts Payable Policies and Procedures.   Our procedures ensure proper approvals when making payments in accordance with the approved budget and the management agreement.

ACCOUNTS RECEIVABLE

The Property Manager is responsible for authorizing billings and for collecting rents.

The accounts receivable system functions as follows:

  • The Property Manager briefs each lease.
  • The Revenue Accountant inputs all lease information from the lease brief into the Yardi accounting system.
  • All monies are either sent directly to a lockbox or collected in the Property Management office by an independent clerk.
  • Copies of the deposit and the checks are sent to the Revenue Accountant.
  • The Revenue Accountant posts the cash receipts.
  • A receivable report is run weekly by the Property Manager.
  • The Property Manager, through on-line access to the Yardi Accounting System, is able to view all billings and collections for each tenant

 

 

ACCOUNTS PAYABLE

The Property Manager is responsible for authorizing expenditures and for approving the actual invoice before the payment is made by Accounting.  The Manager will obtain the proper approval from the Owner approved budget and from the Owner for costs which are not budgeted over $2,500.00.  Pre-approval with the owner is to be verified for approval of unbudgeted items except in the case of where repairs need to be made immediately.

The Accounts Payable system functions as follows:

  • The property manager authorizes all costs and approves all invoices within budget for payment.
  • Unbudgeted costs over a specified amount require additional approval.
  • The approved invoice is coded to the appropriate account number and sent to the Payables Accountant for payment.
  • The Payables Accountant reviews the invoice for coding and approved and inputs the invoice for payment.
  • The checks are approved by a controller and mailed by the Payables Accountant.
  • All checks over $5,000 require two signatures, including one officer’s signature.
  • Checks are issued within five (5) working days of Accounting’s receipt of the invoice.
  • Checks are run weekly.

 

 

BUDGET PROCESS

The budgeting process at HGH Cornerstone consists of a team effort by all concerned parties. We always prepare detailed zero based budgets.  Stage one (1) of the budget process involves gathering input from the following parties:

  1. Owner:  Provides overall objectives of the project and Owner’s specific instructions.
  2. Leasing Representative:  Provides lease-up schedules including projected rates.  Agent also provides input as to capital improvements, amenities, etc., which are needed to be competitive in the market place.
  3. Tenant Construction:  Provides projected tenant finish costs and major refurbishment costs.
  4. Engineering Staff:  Provides input concerning repair and maintenance costs, general supply costs, contract costs, etc.
  5. Management Secretary:  Provides input concerning office and administrative expenses.
  6. Accounting:  Provides rent rolls, operating recoveries, non-recoverable expenses, debt service, depreciation / amortization, etc.
  7. Contractors and Vendors: Provides input to changing costs of services and supplies.

 

 

Stage Two (2) of the budget process involves the following:

Property Manager

  1. Prepares budget with the help of the project team members and completes an analysis of the budget.
  2. Presents budget to Asset Manager and Controller for approval and revisions.
  3. Presents budget to Owner for review, revisions, and final approval.
  4. The budgets are prepared using an Excel spreadsheet model.  Once approved the budget is uploaded to Yardi