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Month-end adjusting entry - an introduction and overview
Month-end adjusting entry - an introduction and overview

Creating your month-end adjusting journal entry

Updated over a week ago

Streamlining End-of-Month Adjustments: A Guide for Property Managers

Tracking and capturing reimbursable amounts between the trust and operating accounts is crucial for maintaining financial accuracy and accountability. By ensuring these transactions are properly recorded in your books, property managers can uphold transparency and effectively manage funds on behalf of property owners. One crucial step in this process is creating the end-of-month adjusting journal entry. Here's the approach to handle this task effectively:

1. Reconciliation and Transaction Capture

Before proceeding with the adjusting entry, it's imperative to reconcile all accounts as per the month-end closing accounting tasks. Verify that every transaction is accurately captured, with no unspecified amounts lingering in the balance sheet by location. This step lays the foundation for precise financial reporting and analysis.

2. Identifying Reimbursable Amounts

Next, focus on identifying reimbursable amounts owed to the property manager for expenditures made on behalf of the property owners. This includes funds disbursed from both operating and credit card accounts. Additionally, account for any expenses incurred from the trust account by the management company for operational purposes.

3. Creating the Adjusting Journal Entry

Proceed to creating the adjusting journal entry. This entry serves to accurately reflect the reimbursement owed to the property manager and any relevant expenses from the trust account.

4. Resourceful Guidance

For detailed instructions on creating this entry, we've provided a helpful resource. Watch the video from our September office hours, beginning at 06:38, for step-by-step guidance on executing the adjusting journal entry seamlessly.

By following these streamlined steps and leveraging the provided guidance, property managers can ensure financial integrity and efficiency in their end-of-month processes.

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