General ledger accounting for properties
General ledger accounting can sometimes seem like an uphill battle.
Having to manage multiple accounts, perform bank reconciliations, and file journal entries can leave room for potential errors in your property accounting.
This begs the question, “How can one mitigate risk in such a complex process?”
What is general ledger accounting?
According to Investopedia, general accounting ledgers can be defined as “the record of all of your company transactions.”
These data points are then split into various categories to make the analysis of such data much easier and more accurate.
Research by the University of Nebraska shows that the most commonly used general ledgers are revenues, expenses, and transfers.
5 reasons you need general ledger accounting software
Closing your books with confidence is not an impossibility.
While many of the challenges faced by your accountants aren’t completely avoidable, you can actually limit the areas in your process where things are most likely to become broken.
How? By taking better control of your general ledger accounts and using MRI’s innovative real estate accounting software to your advantage.
1. Better reviews with GL soft close
Once all the submodules of your general ledger accounting process have been completed, the “Soft Close” begins.
Your software will kick into action, automatically reviewing all the financials that were logged prior to formally closing that period.
This can be initiated and reversed as many times as needed, with the goal of giving property companies the full flexibility needed to make adjustments without causing internal headaches.
Should additional or correcting entries are required, senior accountants can adjust the books themselves or give others the proper permissions to do so.
2. Faster searches with entity filtering
In MRI’s solution, the “Entity Filtering” functionality allows users to take advantage of a smart search bar.
Rather than trawling through hundreds of results to find what you need, you can browse general accounting ledgers through the use of keywords, terms, account names, locations, and more.
This simplifies the overall process by removing all the irrelevant options that show up when you need to make edits, preventing manual manipulation of control accounts.
MRI property clients can use one chart of accounts for entities of different uses, such as commercial and residential buildings. This will keep you more organized and on the right track for the perfect end result that you’ve been searching for.
3. Improve accountability with account filtering
How many times have you been distracted while trying to fill in your general ledger accounts? Lots?
You aren’t alone.
The likelihood is that your team faces all the same issues as you do when trying to do their role, which means you need to provide them with more assistance through software.
“Account Filtering” is an incredible feature that is designed to improve user accessibility and reduce the number of areas where mistakes can be made.
It lets users (such as employees or accountants) only see the information that is relevant to them, reducing certain variables and limiting the possibility of errors. It can also help with task delegation.
4. Greater organization with GL segmentation
The “General Ledger Segmentation” feature on our smart software solution allows property firms to create a hierarchy within their chart of accounts.
This is critical in keeping your databases organized and reducing the opportunity for missteps.
Should you wish to, property accountants can establish “parent” accounts for a category of expenses, and then group all relevant accounts underneath it, making everything more accessible and understandable.
Our software also gives you the ability to group expenses underneath the proper account. From there, your reporting detail is significantly enhanced without the proliferation of accounts.
5. Better annotations with enhanced variance notes
This reduces overlap and miscommunication.
Going forward, it’ll be much easier to compare a variety of metrics and compare revisions in standard reporting formats.
What’s more? Through us, your accountant will also have the ability to make the variance adjustments repeatable if they span across months (or years) of data to avoid tedious re-entry.
General accounting ledger – FAQs
No matter the size or scale of your business, property management accounting doesn’t have to be a complicated process.
By using MRI Software to digitalize the majority of the work, you can ensure that your general ledgers go error-free.
Before you know it, you’ll have significantly reduced the amount of time that you spend puzzling over inconsistencies in your accounts.
If you still have questions about the benefits of managing accounts in general ledgers, perhaps these FAQs can provide the guidance you need.
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All varieties of primarily capital financial transactions (such as sales and spending) that have no operational sub-ledgers should go into your general accounts.
For most, income statements. Without being able to track the cash flow coming into your company, it can be nearly impossible to make educated and informed investment and growth decisions.
You should have a minimum of five, but you can create hundreds of categories in your accounts. Whatever “groups” you envision will be useful to you, you can make.
Manage your general ledger accounts with MRI general ledger
MRI General Ledger is the comprehensive software solution that can put your organization on the right track when it comes to property accounting.
Through features that give users increased visibility, you’ll be able to see all the relevant information you actually need, making the review process for your general ledger easier than ever.
Want to learn more about how taking control of your general ledger can improve your property accounting?
Watch the webinar to learn exactly how you can mitigate risk and cut down on user error by taking control of your general ledger accounts
Market Insights: Multifamily Industry Analysis for Autumn 2023
The MRI Software Market Insights team continues to track trends in the US multifamily industry. This report reflects on the first two-thirds of 2023, with a focus on May through August. Many of the metrics are starting to look like the trends we saw