Did you know you can be 3-way reconciled and not pass your Dept of RE financial audit? Do an OJO Bookkeeping Balance Audit and sleep well tonight.
OJO Balance Audit... Created Specifically For Buildium Clients
Gain Insight and Clarity
A Balance Audit is done to determine how much money should be in your account(s) as of a certain date. This date may be the same date that OJO physically begins doing the work or it may be a date in the past (such as January 1st of this year). Typically you or OJO pick this date for the Balance Audit. This date may be based on the date you want catch-up reconciliations to be done or it may be an arbitrary date you choose to confirm that all funds are in the correct places (owners, properties, tenants, etc).
It’s important to note that your books can be 3-way reconciled and your accounts not be balanced. But once an OJO Balance Audit is completed, you can be assured that you will be 3-way reconciled and balanced.
Determine the exact amount of money in your accounts as of a specific date, chosen by you or OJO.
Ensure your books are fully reconciled and balanced upon completion of the OJO Balance Audit.
Cross-check account balances with bank statements to identify and resolve discrepancies.
OJO auditors employ a set of procedures specific to your books, ensuring accurate results.
Verify that trust funds are accurately accounted for in both your property management software and bank accounts.
Audit-Ready = Peace of Mind!
We research the balances of all of the accounts and reconcile those numbers with your bank statement(s) as of the Balance Audit date. OJO may or may not have the ability to determine the balances of your accounts (owners, properties, and tenants), so we naturally need information from you (or your team) to help us determine the balance of each account. Obtaining these initial balances is the cornerstone of the Balance Audit and important towards avoiding discrepancies. Any discrepancies or inaccuracies found (overages or shortages) have to be charged to some account, and that is typically to your management company. OJO will not audit transactions from previous years, as requested by you, our client
In order to begin our Balance Audit, the OJO auditor will record/enact a set of procedures specific to your books. Following is an example:
- a. The difference between Property Cash Balance and ending cash of Rental Owner Statement should be identified – deleted if necessary
- b. The property cash balances as of December 31, 2022 will be zeroed out by recording an Owner Contribution (if properties have negative cash balance) or Owner Draw (if properties have positive cash balance) on December 31, 2022.
- c. The cash difference from the correction will be absorbed by the Property Management.
- d. The audit team will record the Opening Balance Equity of all properties on January 1, 2023.
- e. After zeroing-out the cash balances, there will be lump-sum reconciliation on January 31, 2023 (including the previous years).
- f. Dummy bank accounts set up by the client should be deleted.
- g. Actual bank account should be set-up in Buildium.
- h. Default bank account for each property should be identified.
The audit team will immediately notify you of any significant and/or reportable conditions noted during the course of the audit.
3-Way Reconciled and Balanced.
Once the Balance Audit is complete, the audit team will provide an oral presentation of their findings. We will then reconcile your bank accounts up to present. This ensures that your Trust funds are accurately accounted for in all of your bank accounts. Any financial information prior to the Balance Audit date may or may not be accurate, and OJO holds no responsibility for the accuracy of your finances previous to the Balance Audit start date.
The Balance Audit will ensure that all of the trust funds are accurately accounted for in your property management software and that those funds are also in your bank accounts. OJO is a bookkeeping company and we are not a licensed CPA firm. The term Balance Audit is an internal term that OJO uses to describe the work we are doing. Although we ensure the accuracy of our specific work, this is not an official financial audit for tax or real estate commission purposes. Please ensure that you are aware of your local requirements.
We are excited to get started ensuring that YOUR books are in tip-top shape!
