Process Your Owner Statements

Introduction

This guide will walk you through the best practice of running your financial statements for your short-term rental business. It is crucial to treat your owner statements with the same diligence as you would an accounting package.

Owner statements should not be edited or deleted. Any necessary corrections should be managed through bills or credits on subsequent statements to maintain a clear and accurate financial record.

Before you begin running and processing your Owner Statements, ensure that you have completed the following training modules:

Training Modules:

Module 1: Property Management: Managing charges and costs for housekeeping and maintenance

• Gain an understanding of how to manage charges and costs associated with housekeeping and maintenance for your properties.

Module 2: Property Management: Accounts & Owner Statements

• Learn the ins and outs of managing accounts and generating owner statements to ensure accuracy and transparency in financial reporting.

By completing these training modules, you will be equipped with the knowledge and skills necessary to effectively manage your financial statements and uphold the highest standards of professionalism and integrity in your short-term rental business.

Preparation for Running Owner Statements

The next part of this guide assumes that you have already added your tasks, bills, and completed your invoices. If you have not yet completed these steps, please refer to the guide titled "Managing charges and costs for housekeeping and maintenance" for detailed instructions.

Key Steps Covered in "Preparing Your Invoices and Expenses" Guide:

1. Adding Tasks: Record all tasks and services provided for each property, including housekeeping, maintenance, and other services.
2. Creating Bills: Generate bills to account for expenses incurred, such as utilities, maintenance supplies, and service charges.

Completing these preparatory steps is essential to ensure that your owner statements accurately reflect all income and expenses associated with each property. Once these tasks are complete, you can proceed with running your owner statements confidently.

IMPORTANT: To Reconcile Your Statements Easily, DO NOT Generate Invoices Until You Have Passed the Reconciliation Process.

How to run Owner Statements

Step 1: Run Your Statement 

1. Navigate to Property Manager > Statements > Open

• Open your property management software and go to the 'Property Manager' section.
• Select 'Statements', followed by 'Open'

2. Update your Filters:

• You will then choose the dates that you wish to run the statement run (it will default to the next statement run) i.e xx/xx/xxxx to xx/xx/xxxx
• Select 'Search' (This may take up to 5 - 10 minutes, so please be patient go make a coffee!)

Step 2: Summary Tab Verification

Analysis

• Rental Income: This section shows the total revenue generated from bookings during the specified period.
• Commission:  It indicates the amount of commission deducted from the rental income by the property management company.
• Money Due: After subtracting the commission from the rental income, this figure represents the remaining amount owed to the property owner.  This MUST Match your Owner Payment Due Report 'Owner Balance'
• Expenses: This area details any expenses incurred during the reporting period, such as maintenance costs or utility bills.
• Closing Balance: The closing balance reflects the final amount owed to the property owner after accounting for all income, deductions, and expenses.

Next Steps

• Verify that the figures align with your records and expectations.
  • If No, refer to 'Statement Balance Doesn't Match Owners Due Report'
  • If Yes, proceed to next step

Step 4: Validate Owner Opening Balances

If you see a 'No Match' red flag on an owner record in the summary, there is a potential problem.  See the example below:

Understanding "No Match" Red Flag

When you encounter a "No Match" red flag on an owner record in the summary, it signals a potential problem that requires attention. Let's explore two scenarios to understand this warning:

Scenario 1: Owner Not Paid Last Month

• Opening Balance: £1,394.69
• Payment Made: £0

If this situation is correct, it could indicate that the owner was not paid last month, despite being owed money. In such cases, it's crucial to investigate the reasons behind the missed payment and ensure that the owner receives the amount due promptly.

Scenario 2: Owner Owes the Agency Money

• Opening Balance: Negative amount
• Payment Made: £0

In another scenario, if the owner owes the agency money and the opening balance is negative, the "No Match" warning would be appropriate. The agency might allow this debt to be offset by future bookings, resulting in no payment made to the owner for the current month.

Action Steps:

1. Investigate: Determine the reason behind the "No Match" warning by reviewing past transactions and communication with the owner.

2. Address: Take appropriate actions based on the investigation findings, such as processing any outstanding payments or adjusting future bookings to offset debts.

By addressing the "No Match" warning promptly and accurately, you ensure financial transparency and maintain a positive relationship with property owners.

Step 3: Review Individual Owner Statements

1. Statements Tab

• Click 'Statements' tab:
  • Navigate to the 'Statements' tab in your management software.
  • This action will display the first owner statement, providing a detailed breakdown of bookings and expenses associated with the property.

Reviewing individual owner statements allows you to ensure accuracy and completeness in financial reporting. Take the time to carefully examine each statement, verifying that all transactions are correctly recorded and any discrepancies are addressed promptly.

2. Identified Errors

• Click 'BookingID' Link
  • Navigate to the specific booking by clicking on the 'BookingID' link associated with the identified error.
  • This action will direct you to the booking details page where you can make the necessary updates and corrections.

Identifying and addressing errors promptly is essential for maintaining accurate financial records and ensuring transparency in your operations. By accessing the individual booking details, you can rectify any discrepancies and maintain the integrity of your owner statements.

3. All Bookings Validated

• If you have had to update booking data:
  • After making necessary updates to booking data, it's crucial to re-run the statements to reflect the corrected information accurately.
  • Repeat the reconciliation process to ensure that all adjustments are correctly accounted for and reconciled with the owner statements.- Reconcile Statements

4. My Statements reconcile and I am happy with bookings that are going to be paid

Once you have validated and reconciled your statements you will need to generate invoices so that we can bring through the expenses for the current month.

• Navigate to 'Property Manager' > Invoices
• Click 'Generate Invoices'
• You MUST set the date as the last day of the statement run you wish process
• You can now go to your statements and run the process again, this time your expenses will be included.

5. Inspect Expenses & Charges

• Expenses & Bills
  • Do these look correct, if you have automation in place does the count of bills match the count of bookings
• Credits & Charges
  • Do the compensation payments or damages reclaimed amounts look correct, have these been validated

Step 4: Backup & Download Payment Reports / Bank Files

1. Export Your Bank File

• Navigate to Pay Via [Bank]
• Select Actions > Export Bank File

2. Export Your Pay via Cheque

• Navigate to Pay Via Cheque
  
• Select Actions > Export to Excel

Step 5: Backup & Download Summary

1. Export Summary Information

• Select Actions > Export to Excel

2. Export Owner by Owner Balances

• Navigate to the Owner Balances Grid
• Select Actions > Export to Excel

Step 6: Process The Owner Statements

• Select 'Process Statements'
• A reminder to validate your statements will appear, if you are happy to proceed click 'Yes, Process Statements'

• If you are not making any adjustments to the amounts being paid, please click 'Process All Statements'
  

Here's an explanation of the highlighted buttons and important notes:

Highlighted Buttons:

• Actions:

  • Allows you to export the Owner Statement or email it directly.

• Process Current Statement:

  • Enables you to process the current Owner Statement individually.

• Process Statements:

  • Processes all Statements in the current run.

• Arrow Button:

  • Navigates to the next Owner Statement.
    
    

Important Notes:

• Owner Payment Schedules: Cannot be marked as "Underpaid."

• Statement Dates: Determined by company settings and Owner Payment Schedule due dates.

• No Match on Summary Tab: May indicate an issue with previous payments or lack thereof.

• Extras Configurations: Ensure Extras settings align with Owner Financial Statement process.

Adding Additional Bookings to Processed Statement:

• Additional bookings can't be added directly to a processed statement.

Options for Missed Bookings:

• A) Ignore: The booking will be included in the next month's statement.

• B) Add a Direct Payment: Pay the owner directly for the missed booking; it will appear in the next statement.

• C) Generate a New Statement: Set up a 1-day statement to cover the new dates if you need to generate a statement immediately.

By understanding these functionalities and considerations, you can effectively manage and process Owner Statements in your short-term rental business.