A Baltimore property management company can offer a lot of services to your HOA. Whether you need help with meeting management, delinquencies, homeowner relations, or maintenance – a good management partner will take a lot of details off the plate of your volunteer board, delivering efficiency and effective services.
There’s also the matter of accounting. Should you outsource your accounting functions to a management company?
There might be some hesitancy due to the confidential nature that comes with accounts, ledgers, books, and finances. Maybe you’re unsure about whether a third party should have access to your financial records.
Understandable.
However, if you don’t outsource your accounting and financial management, you’re likely missing a huge opportunity.
Your Baltimore HOA is certainly managed by a volunteer board of directors who stays busy managing the community and all of its homeowners. Accounting is something that needs strong attention to detail, an understanding of laws and reporting requirements, and a background in taxes and budgeting.
It’s also important to keep costs under control and to ensure your homeowners are getting what they expect and need from their association.
All good reasons to outsource.
Here are additional reasons that it can help.
Valuing Professional Experience and Systems
Most Baltimore property management companies who specialize in HOA management have experienced staff members and contacts who have worked in accounting for years. This area of specialization is going to help your HOA stay in compliance with generally accepted accounting principles. It will help your financial records remain compliant, easy to read, and accurate. Your homeowners will know what they’re looking at and your auditors will have less work to do.
Professionals who work in accounting understand how to help associations like yours achieve their goals and work towards success. Experience matters, and if your HOA board is lacking in accounting expertise, you could run into problems when it comes to balancing the books or forecasting your capital improvements.
Maybe your HOA board treasurer is an accountant or has experience with bookkeeping. That’s great, but with their own career and personal priorities to manage, they may not be able to give your association’s books the attention and service that’s needed.
You also don’t want to hand the accounting duties over to just anyone who is willing to take on the task for your HOA board. Accounting belongs in the hands of experienced professionals. These professionals understand industry standards and requirements, ensuring their work is held to a high standard.
Experienced accounting professionals have the tools and the resources to help you make smart decisions. You’ll get more than day-to-day recordkeeping; you can count on detailed financial analyses and strategies.
A good property management partner will either have these accounting professionals on staff or will know where to find the best solution for your accounting and bookkeeping needs. We provide our own set of unique services and we also allow your HOA to leverage our relationships within a variety of industries, including accounting.
Baltimore HOAs Must be Mindful of Timelines and Reporting Deadlines
The Maryland Homeowners Association Act has its own list of laws and requirements for associations. If you’re an HOA in Virginia or Washington, D.C., you’re also working with a specific set of guidelines and requirements.
Accounting standards must be followed, and the filing deadlines and timelines you’re bound to are rarely negotiable. If you miss a deadline, file a report late, or fail to schedule an audit when you’re required to, there are going to be some unpleasant penalties and consequences.
Don’t let your HOA become an association that’s mismanaged simply because deadlines are missed and timelines are off.
Missing a tax deadline or filing date will be damaging to your HOA or community association. Not only will your reputation take a hit, you’ll find yourself having to answer to the homeowners who are counting on you to keep all the books balanced and compliant.
You don’t need the risk of late or incorrect statements, reports, and tax filings.
This is another good reason to hire a professional accounting service or a Baltimore property management team to handle your association’s books. You need accurate work that’s done on time. Late payment fees and penalties are going to hurt your cash reserves and keep you playing catch-up, which isn’t good for you or your members. It will call your leadership as a board into question.
Baltimore HOA Accounting Communications
Do your homeowners know where to find financial information about your community? Do they know who to contact when they have questions?
This is all part of how you communicate with your residents, and sometimes a third party is needed. Especially when it’s an area that requires specific expertise. It can also help when you’re a board member and these people asking questions are your neighbors. Having a bit of a buffer between you and them can be beneficial, especially on topics such as accounting.
When your homeowners have accounting questions, the board needs to answer them in a timely and responsive manner. Even if you don’t know the answer right away, you should endeavor to resolve their issue. If you can’t do that, your homeowners will lose faith in the board’s abilities.
Communication can be difficult if you’re not prepared. Accounting professionals can handle communication with you, your board, and your entire community. You can count on emails, phone calls, even online portals if you’re working with a Baltimore association management team.
Outsourcing your accounting will result in better communication on financial matters, and that’s going to make your board more trustworthy.
Accessing and Leveraging Accounting Technology
Property management technology and software has come a long way over the last five or ten years. If you do not have a tech-driven and automated system in place already for your HOA, working with a company that does have those tools can save you a lot of time, money, and frustration.
We work with some of the most innovative technology that’s available. One of the areas in which it provides the most help is accounting.
The latest technology can be a huge asset to HOA boards, but we know it can be expensive to buy and install yourself. You might not have the training required to use it effectively and to its full potential. You’ll need to sync it and integrate it with any existing platforms and systems you might have.
Outsourcing the accounting work can ensure you’re getting access to the best technology that’s available. These tools will provide more efficiency, better documentation, and extra transparency. You can expect to solve complex problems quickly and easily. Online resources such as online payments will help you collect dues and assessments. Having access to these tools will save your HOA money and time.
With accounting technology comes online safety. You can expect strict safeguards and confidentiality as well as controlled access and backup. You want to protect your finances from fraud and hackers. Working with a property manager or an accounting expert will bring you that extra peace of mind. Security protocols are part of every system we use.
More Efficiency and Accuracy in HOA Accounting
An accounting team can increase your organization’s efficiency. The people who are currently managing your HOA’s accounting tasks can turn their attention elsewhere, allowing you to get more work done for your community and your homeowners.
The average HOA board is rushing to put out fires on a day to day basis. You’re likely negotiating contracts with landscapers or roofers. You’re looking for ways to drum up attendance at the annual meeting. Maybe you’re spending a lot of time collecting overdue assessments and following up on violations.
Outsourcing this part of your duties will deliver more time to you and more efficiency to your process. Your board members don’t have to be responsible for collecting monthly, quarterly, or annual dues. You don’t have to put together a budget for next year. You don’t have to go through line items in your expense reports to make sure everything adds up. Having an accounting professional do all of this for you will result in better results and high quality work that’s free of errors.
Outsourcing Saves Money for Your Baltimore HOA
If we haven’t convinced you yet that outsourcing your accounting work is the best thing for your HOA, consider this: Outsourcing your accounting needs to a professional management company or financial services provider can save your association money and protect you against expensive mistakes.
You can avoid unnecessary operational costs by using a professional accountant. There’s no need to spend time and money training individuals on how to take care of things that a professional can manage faster and with more accuracy.
You’re getting more than accounting – you’re getting systems, professional expertise, and technology that makes communication and accountability better.
If you’d like to hear more, please contact us at Stripe Management. We work with owners, investors, and properties in Upper Marlboro, Prince George’s County, Washington, D.C., Capitol Heights, District Heights, Baltimore, and anywhere in the DC metro area.