It takes hard work, strong communication, and great organization to effectively manage an HOA. But even the most passionate staff and members cannot maintain their community without money.
HOA fees account for the majority of revenue coming into an HOA community. Fees are used to uphold the value and desirability of an HOA community. The money paid by members is used to compensate staff, purchase insurance, pay for maintenance, utilities and repairs, and much more.
Considering how critical revenue from fees is to any governed community, it’s not hard to understand why having a standardized fee collection system, including an accurate record of accounts receivable, is essential to the overall financial health of the association.
Members must know how much they owe, when payments are due, and how to pay. The people in charge of fee management must track and follow up on delinquent payments to make sure the HOA gets all of the money it is owed.
Using QuickBooks to manage HOA fees
QuickBooks provides HOAs with a streamlined way to set up an accounts receivable system. The reputable accounting system is designed for non-accountants, which is one key reason why it is so popular.
HOAs can utilize accounts receivable features in QuickBooks to distribute invoices for fees, record payments not made through the program, and maintain accurate records of payments made by residents. Additionally, with the accounts receivable functionality, management can easily identify past due amounts, and review and update payment terms.
An online accounting program helps HOAs reduce costs associated with labor because it promotes more accurate invoices and records. This also leads to fewer disputes between the association and residents. Furthermore, the accounts receivable tracking feature simplifies the reconciliation process, saving staff even more time.
Though QuickBooks is not specifically designed for governed communities, it is very dynamic and can meet the needs and requirements of most HOAs.
Best practices for using QuickBooks
It takes a bit of time for most users to understand the ins and outs of QuickBooks, but once you get the hang of it, you’ll start to appreciate how effective the system really is. These best practices can further augment your process for tracking and processing HOA fees. As a result, the association’s cash flow becomes more reliable, and this process becomes less painful for your team.
1. Take full advantage of the accounts receivable feature
Using the AR feature to create and distribute invoices is a great start, but QuickBooks will permit you to do much more. You can check on which members have paid their dues for the month, and which ones have outstanding balances. The program also gives you the ability to send overdue reminders to those members.
You can also accept payments online through invoices. QuickBooks makes it easy to accept online payments, track incoming payments for each invoice, and generate reports.
2. Set up automated emails
With QuickBooks Online, HOAs can set up recurring invoices to be automatically emailed to members on a certain date. This convenient option completely eliminates one big “to-do” item for staff in charge of this responsibility. Additionally, if your community uses QuickBooks Payments, members can pay online and the payments will be automatically recorded in QuickBooks.
3. Integrate with property management software
QuickBooks integrates with over 750 apps so that customers can combine their favorite programs instead of having to choose one over the other.
Condo Control is one of the top property management software platforms that work collaboratively with Condo Control, and when the two are combined, HOAs gain access to a comprehensive accounting and data management solution.
The two-way sync capability between the platforms means staff only have to enter data into one platform. Changes are automatically reflected in the other program.
Members also have the ability to make payments for select unpaid invoices or bookings using their Condo Control account, and payments will automatically appear in QuickBooks Online. They enjoy easy access to their account balances, and never have to leave Condo Control to get that information. All authorized parties have access to records, so if there is ever a problem, it’s far easier to review invoices and see if a mistake was made.
By using both programs, HOAs create a data management process that is both simple and accurate. Members have more self-serve options which ultimately reduces the workload for staff.
4. Make use of categories and customizations
The more time you spend creating a custom QuickBooks workspace, the more you’ll get out of it. Make sure you or your team members are completing records and transactions thoroughly. That means filling out all applicable categories. When it comes to this type of work, generally speaking, the more information you can record or include, the better.
Assign categories to fees if possible, and mark them as billable (or not). Categorized expenses will be very useful when it comes time to prepare taxes or complete audits.
There is no shortage of YouTube videos demonstrating how to make your QuickBooks account your own. Explore a few to find out how you can build an even better accounts receivable process.
5. Run monthly reports
It’s possible to run a number of reports with QuickBooks Online, including an accounts receivable aging summary. This allows you to see outstanding balances and how long they’re past due. Reports can be modified/customized, but many users are happy with the reports as they are.
AR aging reports help you to identify members who have a habit of making late payments. They also give you an idea as to how effective your current collection process is. For example, if you have a lot of outstanding payments that are over 60 or 90 days, you may consider altering your collection practices in some way.
6. Use the cheat sheet
This QuickBooks cheat sheet teaches you keyboard shortcuts so you can access various windows and pages without touching a mouse. These handy shortcuts help to make your workday a little bit more pleasant.
QuickBooks is a popular accounting system used by customers in all types of industries. It is ideal for some HOA communities, especially those that are on the smaller side.
QuickBooks can help automate and streamline the process of documenting and collecting monthly payments from members. Not only does an online system help to improve cash flow for the community; it reduces the workload for your team too.