How to Check if Your Books Are Audit-Ready

August 10, 2021
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If your trust accounts were audited today, would your books pass? The answer may surprise you. Most property management companies are pretty confident that they would pass, and some aren't so sure. Unfortunately, most companies would not pass. APM Help is striving to set a new standard in the industry by helping companies like you clean up their books, and keep them so clean that you can pass an audit on any given day. So, let's answer the lingering question - are your books audit-ready?

What You Need to Pass an Audit

An auditor will look over some main categories, and if they don't find any issues with those, then you are generally in the clear. If there are any oddities in their first run-through, then they will dive deeper into your books, and may even request data from previous years. Here are the standard items the auditor will look for:

  1. Bank reconciliations in balance and current up to the most recent statement date
  2. No negative property balances (this includes hidden/closed properties that you no longer manage)
  3. Enough funds in the Operating/Rental Trust account to cover all prepayments 
  4. Enough funds in the Escrow/Security Deposit Trust account to cover all management held security deposits 
  5. No uncleared deposits from previous months
  6. No uncleared checks older than a year or 6 months, depending on your local real estate regulations

There are other factors that depend on your state regulations such as: 

  • An appropriate amount of funds held on your corporate property/ additional funds held in the trust accounts
  • No past tenants with outstanding liability (prepayments or security deposits)

Reports to Check Your Books

  1. Bank Reconciliation Report (Uncleared Checks, Uncleared Deposits, In Balance)
  2. Trust Account Balance Report (Property Balances)
  3. The date will be as of the statement date
  4. Make sure to customize the report to show ALL properties - not just the “Active Properties”. Your non-active properties should show $0.00 across the board
  5. Under "Columns" add the following: Unused Prepayment Amount, Unpaid Bills Amount, Reserve Amount, and Work Order Estimates (the Operating/Rental Trust balance should at least cover the prepayments and reserves)
  6. Run the report, you shouldn't see any negative balances on this report
  7. Security Funds Detail Report (Liabilities Check)
  8. The date will be as of the bank statement date 
  9. Make sure you’re only selecting the liability GL accounts that are management held (These GL accounts are typically offset Escrow/Security Deposit Cash)
  10. Make sure to customize the report and select ALL properties and ALL tenants 
  11. Re-run the report for the Prepaid GL account to ensure that all of the prepaid balances are associated with Current, Notice, or Future tenants
  12. General Ledger Report (Overview of cash transactions in that period)
  13. The date range will be the same as the statement dates
  14. Only select the Cash GL Account(s) associated with the bank account
  15. Customize the report to show ALL properties 
  16. While you’re customizing the report, check the box at the bottom of the Filters screen to show reversed transactions
  17. Again, depending on your bank account set up you may need to create a property group that is made up of all of the properties associated with the bank account you’re examining 

Are your books audit-ready? Still not sure? Let us take a look and put your mind at ease. You can either email us at, call 281-949-8755, or submit your information on our website: We will provide a free 30-minute consultation and get your books on the right track!

Our Services

On-Demand Consulting

On-Demand Consulting

Consulting with AppFolio, Buildium, Propertyware, & Rent Manager experts to answer any and all software related questions in less than an hour. No long-term contracts and easy to get started.

On-Demand Consulting

Trust Bookkeeping Services

Bookkeeping services provided by expert accountants for AppFolio, Buildium, Propertyware, & Rent Manager. For less than the cost of a full-time bookkeeper you can have a whole team of experts.

On-Demand Consulting

Corporate Bookkeeping

Let us take care of your corporate payables, receivables, reporting, and payroll with Quickbooks and Gusto. With us you can focus less on accounting and more on growth!

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Daily Bank Reconciliations

Get your bank reconciliations done every single day! Keep your books accurate by making sure that everything is  accounted for. Available for AppFolio, Buildium, Propertyware, & Rent Manager.

On-Demand Consulting

Daily Audits

Curious just how clean your books are? Find out with Triple Tied Out! It's our daily auditing service that checks your bank recs, liabilities, and property balances. For AppFolio, Buildium, & Propertyware.


Why Choose APM Help


Our consultants are well-versed in the software solutions commonly used in property management. Whether you're using AppFolio, Buildium, Propertyware, or Rent Manager, we have the expertise to clean up your books and maintain their accuracy.

Scalable Solutions

As your business grows, so do your accounting needs. Our U.S.-based account managers with industry experience are dedicated to managing your books, giving you the time and confidence to focus on expansion.

Audit Support

Going through an audit can be a daunting task. We offer daily audits and audit preparation services to ensure your books are always audit-ready, providing you with peace of mind.

Back-Office Services

Beyond bookkeeping, we offer a range of back-office services to streamline your operations, including maintenance coordination, property improvement loans, and corporate bookkeeping.
Your Success, Our Priority
APM Help is not just a service provider; we are your partners in success. We understand thatproperty management demands a holistic approach, which is why we offer a suite of services tailoredto address the diverse needs of your business. Our goal is to empower property managers to excel intheir markets by providing them with clean books, efficient processes, and the time they need tofocus on building strong client relationships and achieving their growth ambitions.

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