We get it, you didn’t necessarily sign up to be an accountant when you became a property manager – but that doesn’t mean you’re exempt from the responsibility. If that were the case, we could think of a lot of tasks we didn’t sign up for that we’ll just forget about!
In all seriousness, quality accounting is essential to successful property management, so it’s best you start reading up if you haven’t already. Whether you’re new to property management or just need a quick refresher on accounting best practices, here are 4 common accounting mistakes you should know about (and how to avoid them).
The first step towards accurate accounting is categorizing your costs correctly. It seems simple enough, but the reality is, property management comes with a lot of different classifications, and it can be easy to miscategorize. Miscategorizing your costs can lead to confusing records and even inaccurate statements. Whatever accounting system you decide to go with, make sure there’s a chart of accounts to keep your costs as clear and organized as possible and avoid the consequences of messy classifications.
Relying on Paper Records
We covered this one in our last blog, 4 Reasons You Need to Take Your Accounting Digital as a Property Manager, but in case you missed it, relying on paper records ranks up there with our biggest no-no’s of accounting. Digitizing your accounting makes it more efficient, more secure, and more accurate – boosting your company’s value overall and saving you time and money. Plus, physical documents and records, like paper receipts, are at a much higher risk of being lost, stolen, or destroyed compared to their digital counterparts. Lucky for you, ManageGo is just about to release our brand new accounting solution! With our modern technology and easy-to-use interface, going digital with your accounting has never made as much sense as it does now (and you can ditch those paper records for good).
Failing to Reconcile Accounts
Any proper research will tell you that reconciling your accounts is an essential step in good accounting. Reconciliation of your accounts just means that you’re comparing your internal records with external ones to ensure there are no discrepancies in your reporting. Failing to do so is detrimental to your business’s financial health; plus, you’re almost guaranteed to be slapped with a fine for it.
Neglecting to Run Reports Regularly
Financial reports are essential to sound decision-making throughout your business, and neglecting to run reports regularly is a rookie move that’s, unfortunately, a common mistake. Making use of the right accounting software to run reports simplifies this process, and makes obtaining the data you need a breeze. With ManageGo’s system, pull reports on everything from properties and receivables to vendors and payables, and of course your essential financials.
But it’s not just the fact that you need to run reports – you should also be confident that they’re accurate. After all, if your numbers don’t reflect the facts, it’s hard to make informed decisions for your business. For more on how to increase accuracy within your accounting, check out our recent blog post here.
No matter your business goals, ManageGo has your back. To discover just how our software solutions can benefit you and your unique property management needs, request a demo today. Or, connect directly with one of our experts and get started on your journey to better property management. Plus, subscribe to our weekly newsletter to explore the industry, get the latest company news, and be the first to know about special announcements!
Want even more? Get your fix and follow our socials for all the latest property management tips, tricks, & trends!