The honest, accurate and timely financial management of any residential community is arguably the most important service that professional management can provide for the Board of Directors (BOD). Every community is in need of financial management. If we are successful in gaining your confidence and given the opportunity to work with you, we will examine your operating expenses and make recommendations that will reduce expenditures. We are pleased to provide our superior financial services in our partial management services program. All reports and information are prepared in easy-to-read formats, permitting directors to fully comprehend the information within our reports. Here are the highlights of the functions we provide:
Immediately upon our partnership, we will create a ledger account in our computer system for each owner. This ledger account will show every payment and charge in an easy-to-read format. All postings to the owner’s ledger account are accomplished in a timely manner. Charges to the account include monthly maintenance fees, special assessments, late fees, chargeable work orders, fines and any other charge that the BOD wishes to initiate. The monthly maintenance fee postings and the like are performed on a scheduled and automatic basis in accordance with BOD policy. Charges are reconciled against the month to date planned budget revenues. Payments are posted as received.
Monthly Maintenance Fees by Coupon Books or Invoicing
Some communities prefer the traditional method of mailing a monthly invoice to each owner. Others have become accustomed to providing a 12-month coupon booklet, similar to a mortgage payment booklet. In our experience, coupon booklets are the most cost-effective method. Coupon booklets are printed professionally and each booklet is accompanied with 12 mailing envelopes. This provides shareholders a convenient method of making payments.
Payments to Lock Box or to Management
The overwhelming majority of communities require owners to mail their monthly maintenance payment to management. There are a select few who still rely on a bank lock box. Lock box use can get rather expensive and create a lag time for posting payments to owner ledgers. Our recommendation is the use of coupon booklets. It is important to note that we are one of the few management companies to offer insurance protection of community funds by procuring a $100,000 fidelity bond for each of our communities. This bond is provided at no cost to you.
On the day designated by the BOD, we create a delinquency report, which details each owner in arrears, the aging of each delinquent owner and the last payment posted. Delinquent owners receive a monthly notice of arrears.
Every community should establish a standard approach to delinquent owners to avoid selective enforcement. Sincere attempts should be made to develop a work out plan, prior to commencing legal action. However, when all reasonable attempts at resolving past due accounts have failed, a collection attorney should commence appropriate action to protect the interests of the community. Our accounts receivable staff will coordinate efforts with your attorney. With BOD permission, we will contact delinquent owners to see if a payment program can be put into place whereby common charges are paid on a current basis, while working down the arrears. This approach works.
Every vendor is set up with their own ledger account. Invoices are posted in a timely manner. Work orders and purchase orders are matched against invoices for accuracy and accountability. A payables schedule sent to the treasurer ensures the invoices are matched to the appropriate budget line item.
The community budget is entered into our computer system. We work with the BOD to appropriately allocate each expense line. With this information, we produce a monthly budget comparison report, which summarizes the month to date and year to date actual expenses versus the budget plan. This provides the BOD with an effective managing tool for all future expenses, planned and unplanned.
Check Payment Preparation
Checks are prepared for BOD signature on a weekly / biweekly basis. Checks are mailed to the treasurer for review and signatures. All checks are accompanied with a copy of the invoice(s) being paid and a stamped envelope ready for mailing.
A detailed report is presented to the BOD in our monthly management report. Our check register report itemizes each check generated within the month and lists the date, check number, amount of the check and payee for every check written.
Our computer maintains an accounting of all incomes and expenses. Each entry is logged against the budget line so that tracking is easily summarized. Year end and interim reports are available at the request of the BOD.