How to tell if your property management software's books are wrong before an auditor does
How to tell if your property management software's books are wrong before an auditor does
Every major PM platform generates signals when something is off in the books. Most PM companies don't check them until something breaks. Here's where to look in each platform and what the signals mean.
In AppFolio, the first place to check is the Financial Diagnostics report under Reports. Nine diagnostics run automatically. The ones that fire most often are Security Deposit Funds Mismatch, Escrow Cash Account Balance Mismatch, and Bank Reconciliation Lapses Over 60 Days. If any of these are flagged, the books have a problem that needs to be resolved before the next reconciliation. The Bank Account Association report is also useful: it shows which cash GL accounts are tied to which bank accounts and surfaces cases where a transaction landed in the wrong account.
In Buildium, run the Security Deposit Liability report first. The total should match your escrow bank account balance exactly. If it doesn't, there's either a misposted deposit or a move-out that wasn't processed correctly. Next check for uncleared items going back more than 60 days in the bank reconciliation. Buildium flags unreconciled accounts but doesn't prevent you from continuing to post transactions, so old uncleared items accumulate silently.
In Propertyware, the trust account detail report is the primary diagnostic tool. Run it monthly and compare the total to your bank statement. Look specifically for negative owner balances, which indicate a property spent more than it held in the trust account, and for transactions with no corresponding owner ledger entry. Propertyware's reporting depth means there are a lot of reports available, but the trust account detail and owner ledger are the two that catch the most compliance issues.
In Rentvine, the owner ledger and trust account summary reports serve the same function. Before each reconciliation, run the owner ledger report and look for any negative balances. Rentvine's pre-distribution review step will also flag if an owner's available balance doesn't support the planned distribution, which is a useful second check.
Across all platforms, the most reliable early warning sign is a negative owner or tenant balance. It means the trust account covered an expense that wasn't supported by the ledger balance, which is a compliance problem regardless of whether the total trust account balance looks correct.
How to tell if your property management software's books are wrong before an auditor does
Every major PM platform generates signals when something is off in the books. Most PM companies don't check them until something breaks. Here's where to look in each platform and what the signals mean.
In AppFolio, the first place to check is the Financial Diagnostics report under Reports. Nine diagnostics run automatically. The ones that fire most often are Security Deposit Funds Mismatch, Escrow Cash Account Balance Mismatch, and Bank Reconciliation Lapses Over 60 Days. If any of these are flagged, the books have a problem that needs to be resolved before the next reconciliation. The Bank Account Association report is also useful: it shows which cash GL accounts are tied to which bank accounts and surfaces cases where a transaction landed in the wrong account.
In Buildium, run the Security Deposit Liability report first. The total should match your escrow bank account balance exactly. If it doesn't, there's either a misposted deposit or a move-out that wasn't processed correctly. Next check for uncleared items going back more than 60 days in the bank reconciliation. Buildium flags unreconciled accounts but doesn't prevent you from continuing to post transactions, so old uncleared items accumulate silently.
In Propertyware, the trust account detail report is the primary diagnostic tool. Run it monthly and compare the total to your bank statement. Look specifically for negative owner balances, which indicate a property spent more than it held in the trust account, and for transactions with no corresponding owner ledger entry. Propertyware's reporting depth means there are a lot of reports available, but the trust account detail and owner ledger are the two that catch the most compliance issues.
In Rentvine, the owner ledger and trust account summary reports serve the same function. Before each reconciliation, run the owner ledger report and look for any negative balances. Rentvine's pre-distribution review step will also flag if an owner's available balance doesn't support the planned distribution, which is a useful second check.
Across all platforms, the most reliable early warning sign is a negative owner or tenant balance. It means the trust account covered an expense that wasn't supported by the ledger balance, which is a compliance problem regardless of whether the total trust account balance looks correct.
Services Tailored for the best Property Managers.
Whether it's rental property management, bookkeeping support, training, bank reconciliations, or emergencies - we're here to help.
Financial & Books Cleanup
Get your books and financials cleaned up to be 100% audit proof.
Trust Bookkeeping
We keep your trust books clean, tidy, and up to date.
Corporate Bookkeeping
Don't worry, we also keep your corporate books clean as well!
And so much more...
We provide a large array of services to help power the best PMs out there.
