Choosing the correct Accounting Module when Creating Asset Groups
Choosing the correct Accounting Module when Creating Asset Groups
When creating a new Asset Group, you will have the option to choose between two accounting modules to determine the functionality available for that Group: Basic or No Accounting.
This depends on a number of factors, and needs to be specified from the point of Asset Group creation - this is not something that can be amended later.
In addition to the information below, you can also use this diagram to make the correct setup decision: Basic vs. None Accounting Diagram
Option 1: None Accounting
- This is where you have different landlords for the different Assets in an Asset Group
- Each unit is managed separately – they have no connection with each other.
- The flow of funds: Funds are received from the tenant, you pay expenses from received funds, rent goes out to the owner in separate payments per unit. Please also read this article on the option to group payments together per beneficiary as Remittances: Remittances explained
- The purpose and benefit of this type is to just group your Assets together so you can have an overview of what units you manage and then also a place where you can save documents like conduct rules and extra information or contacts applicable to the Asset Group.
Option 2: Basic Accounting
- This is where all the units you manage in this Asset Group have the same landlord - you are not dealing with different landlords for the different units. It does not have to be literally the units in the asset group, as long as it is the same landlord for all the units that you are managing.
- For this type, you will get an additional Asset Group Account, where all the funds received from the individual units are collected. This means an additional accounting and payments step.
- The purpose of this is so that you can pay bulk expenses e.g. a municipal account for the WHOLE building. The group expenses are paid from the collected funds.
- With this, you get statements like an Asset Group statement and a Rent Roll.
Additional tips:
- You can not change the Accounting module of an Asset Group later on. You need to specify it correctly from the very beginning.
- If you do not need to pay Group level expenses, and the landlord does not specifically want the Basic Accounting reports, you can set it up as None Accounting.
- Always remember to link Assets to an Asset Group (whether none or basic accounting) at the point of creating an asset. There is no way to go back and link it later on.