Association board reports are central to the success of your association management company. These reports help you oversee the financial underpinnings of your entire association portfolio. They also help your managers reassure their clients that they are doing everything they can to help the associations thrive.
If reports are inaccurate or incomplete, your board members and managers may have difficulty identifying association strengths and weaknesses.
Whether your company uses manual processes or accounting software to create reports and financial statements, errors are hard to avoid. Still, even one tiny mistake can lead to costly problems for your association management business.
Boost Decision-Making Power With Timely, Precise, Compliant Reports
Precise financial reports will help you make better business decisions at the portfolio level. Furthermore, to satisfy their responsibilities, your association board members need financial information that is timely, accurate, and compliant.
Ensure Reports Are Timely
Initiating month-end financials and board packages promptly for each association in your portfolio is challenging for your accounting team. Of course, this part of the job only gets harder as the portfolio grows.
Gathering data from various platforms or software programs to compile into a usable report for your boards can take extra days or even weeks.
Software that reconciles your client accounts daily gives your boards improved financial visibility and faster monthly packages. Board reports are available within days of month’s end.
Timely reports give you and your team members an accurate update on the financial health of your portfolio. This allows you to monitor board satisfaction and safeguard association retention. Additionally, it gives insight into the profitability of your existing associations and company growth potential.
Reporting Accuracy Is Critical
Logging into multiple platforms to complete daily accounting tasks and month-end reporting is frustrating and inefficient. It can also lead to mistakes. Manual data input, or logging into various platforms, can increase accounting inaccuracies. The more programs and systems your association accountants log into, the higher the chance for data-entry errors.
Centralized cloud-based accounting software employs automation to minimize manual work to increase your entire team’s accuracy and efficiency. Banking data is pulled into the accounting platform automatically for daily reconciliations.
Furthermore, accessing reporting data on one centralized system enables data to be imported easily, reduces manual entry, and improves the timeliness and accuracy of your company’s financials. This allows you to make better business decisions.
Financial Reports Must Be Compliant
Your associations’ reports need to represent your boards’ actual financial picture to your managers and external stakeholders. Critical to this is to be sure they follow Generally Accepted Accounting Principles (GAAP) or other relevant standards.
GAAP endeavors to regulate and standardize accounting methods across non-profit and for-profit industries. Standardized statements make it easier for board members to understand the reports and potential investors to analyze and glean useful information. They also prepare your associations in case of an audit.
To streamline your reports and ensure they are GAAP compliant, use specialized association accounting software. A cloud-based system helps your team organize and prepare your associations’ financial statements. It has the additional benefit of customizing month-end financial reports and board packages for each of your associations.
Increase Financial Visibility With Multiple Reports
To retain associations and grow your portfolio, you must be financially transparent and provide board reports on which your clients can depend. The following are common yet vital reports association management companies should be supplying to their boards.
Comparative Income and Expense Report
A comparative income and expense report provides monthly and year-to-date data alongside the current year’s budget. This allows each of your associations’ boards to see whether actual income and expenses are meeting projections. If not, they may decide to adjust specific categories of next year’s budget based on your report’s financial information.
The balance sheet provides a monthly snapshot of the associations in your portfolio. It is also one of the most critical parts of a board package. Include all assets, liabilities, and reserve funds so that your associations’ boards know how much money is available at any given time. This can assist boards in making decisions about future projects and capital repairs.
Bank Reconciliation Report
A monthly bank reconciliation report presents individual transactions for each deposit to or withdrawal from your associations’ financial accounts. Your boards will be able to see the details of day-to-day activity throughout the past month. They may also request access to banking activity throughout the month, so look for a system that includes real-time bank updates and monthly reports.
Project Status Report
At some point, every association will have to undertake projects to repair, upgrade, or add to its infrastructure. Project status reports give the board updates on each project’s progress. The details will vary according to project specifics but could include project bids, expenditure breakdowns, and the estimated completion date.
Aged Delinquency Report
Some homeowners will undoubtedly be late when paying their association dues and fees. The aged delinquency report provides overdue payment information to the board, including homeowner names, fee categories, and how far behind each account is. Using this data, your association boards can decide what additional collection action to take if any.
Financial reports provide your associations with the data they need to make smart decisions. When they succeed, you succeed. This is why timely, accurate, and compliant monthly board reports are the foundation of a growing association management company.