Even if you work with a professional CPA or tax advisor, managing your accounting and bookkeeping as a rental property owner can sometimes be a challenge. While most owners understand the importance of documenting income and expenses, putting a system together that helps you analyze your investment performance isn’t always easy.
But, it’s important.
When you want to maximize your return on investment, you need to invest in an accounting system that will help you track income and expenses as well as plan for future expenditures. With the right financial reporting, you can make smart investment decisions that will help you earn more and spend less on a single property or an entire portfolio.
Property management companies have a fiduciary duty to provide accurate and detailed financial statements and accounting reports that are timely and easy to read. Detailed, accurate, and transparent accounting practices is a huge benefit to working with a professional Noblesville property manager.
Property Management and Accounting: Advantages and Benefits
Landlords and investors trust property managers with their rental home and sometimes with an entire portfolio of rental homes. Whether you’re an investor who only wants to see the bottom line on a quarterly basis or an involved landlords who studies the numbers every month, property management can provide the tools that independent landlords can’t get on their own.
Terrible accounting is one of the reasons a lot of owners change property management companies. You have to trust the information you’re receiving and you have to trust that your money is being spent safely. Providing information that is inaccurate or incomplete does not inspire a lot of confidence. One mistake every now and then is to be expected. But if the accounting statements you receive every month have more errors than accuracies, you need to get to the bottom of what’s going on.
General Accounting Principles must always apply to anything pertaining to your books and financial records. Make sure you know your money is being handled properly and lawfully before you hire a management company.
Investing in Technology and Property Management Accounting Software
We work with the best accounting software platforms that are available. Investing in technology has made our work transparent and it also holds us accountable to our owners and our tenants.
On our portal, everything is automated and information is immediately available. We’re able to see what your property has earned and spent over the last day, month, year, or decade. With our systems integrated into the property management system we use, our owners never have to worry about the big financial picture or the day-to-day details.
Accounting Communication and ROI
When you’re managing your own rental property, a simple spreadsheet might seem like it’s doing the job. But, you could be missing out on important trends and patterns when you’re not working with better software. If you’re not able to invest yourself, work with a professional property manager who already has these systems in place. The communication will be accurate, detailed, and transparent.
You can expect to receive financial information that reflects the performance of your investments. You’ll be able to make adjustments as needed to increase your ROI and reduce your expenses. The decisions you have to make will depend on having access to good information, and you should never settle for anything less.
A good property management company will not make mistakes involving your finances. If you’d like to talk more about your tax benefits, earning potential, or cash flow, please contact us at Red Door Property Management. We’d be happy to tell you more about our own systems and how they can help you.
