How to Check Your Apartment Property Manager's Monthly Owner Statement Against the Bank

What is an apartment building's property management owner statement?

A property management owner statement is the monthly report a manager sends an owner. It shows rent collected, bills paid, fees taken, and the amount paid out to the owner.

The statement is the manager's account of the month. The rent roll and the bank statement are 2 more records. The owner statement is one record in apartment building bookkeeping. This page shows how to make the 3 records agree.

What should an apartment building's owner statement include?

6 parts: beginning cash, rent collected by unit, expenses with invoices, management fees, the payment to the owner, and ending cash.

• Beginning cash: what the manager held for you at the start of the month.
• Rent collected, by unit, with rent due beside it.
• Expenses, each with an invoice and the unit or area it was for.
• Management fees, each named, with its rate and what it was charged on.
• The payment to you.
• Ending cash: what the manager still holds.

Sample owner statement, invented data

The sample shows the money lines. A full statement also carries beginning and ending cash, which the check below ties to last month and to the bank.

How do you check an apartment owner statement against the bank?

Match 3 records. Rent due on the statement should equal the rent roll. Rent collected should equal the bank deposits. The owner payment should equal what reached your account.

Here are the 12 lines, run on the Oak St sample. 11 pass. 1 fails.

1. 1Beginning cash equals last month's ending cash.
2. 2Rent due equals the rent roll.
3. 3Rent collected equals the bank deposits.
4. 4Every vacant unit is named.
5. 5Late rent is listed by unit.
6. 6Credits and move-in specials are listed.
7. 7The management fee uses the contract rate and base.
8. 8Every other fee has a contract clause.
9. 9Every repair has an invoice and a unit.
10. 10Deposits held equal the deposit list.
11. 11Any amount held back matches the contract.
12. 12The owner payment equals the bank deposit.

Line 3 is where most of the work is. Why rent due and rent banked differ is explained in rent roll vs bank statement. Line 12 ties the cash to the bank. Tying ending cash to the bank is a bank reconciliation for an apartment building.

The 12 lines on the sample, invented data

Which management fees appear on an apartment owner statement, and how is each recorded?

The monthly management fee, plus leasing, renewal, maintenance and office fees if the contract allows them. Record each as its own cost line, not netted against rent.

Your contract sets each fee's rate and base. The base matters: 6% of rent due and 6% of rent collected are different numbers whenever a unit is vacant or late. The management fee is one line of apartment building operating expenses.

If a fee is netted against rent, the rent on your P&L will not match the rent roll. Whether a fee is deductible is a question for your CPA.

Which differences show up most often on an apartment owner statement?

A fee charged on rent due instead of rent collected, a vacant unit not shown, late rent missing, a repair with no invoice, deposits not listed, and timing between month end and the bank.

• The management fee charged on rent due instead of rent collected. Usual cause: the software default, not the contract.
• A vacant unit not shown. Usual cause: the statement lists only units that paid.
• Late rent missing. Usual cause: the unit was left off because nothing was collected.
• A repair with no invoice. Usual cause: the invoice is in the manager's system and was not attached.
• Deposits not listed. Usual cause: the manager keeps deposits in a separate account and leaves them off the statement.
• Timing between month end and the bank. Usual cause: a payment collected on the last day of the month reached the bank in the next month.

What do you ask the apartment building's property manager when a line does not match?

Name the line, the 2 amounts and the record you compared it with. Then ask one question: which figure is right, and what in the contract or the bank supports it?

• "The statement shows a management fee of $1,044. The contract says 6% of rent collected, which is $852. Which base was the fee taken on?"
• "One unit is on the rent roll but not on the statement. Was it vacant, late, or left off?"
• "The repair line is $1,180. Can you send the invoices and tell me which units they were for?"
• "The statement shows no deposits. Where are they held, and can I have the list by unit?"
• "Rent collected is $14,200 but the bank shows a different total. Which payments are in one and not the other?"

A difference is a question for the manager. Keep the answer with the statement.

How often should an apartment owner check the statement?

Every month, as soon as the statement and the bank statement are both in. A difference found in the same month is a quick question. One found at year end is a project.

When the manager changes, the same check becomes the books handover checklist for switching property managers.