PM refuses to log tenant reimbursement properly

[Daria B.]

The PM refuses to log the utility reimbursement from tenant properly, is this really a big deal?

I pay the utility directly, for reasons of ensuring it gets paid and is not the issue here.

The tenants receive a bill copy of the utility and they pay that to the PM who turns it around to me. 

This is a new PM I have and they, unlike previous PMs, are listing this under “rental” and showing it lumped into the 1099. I asked them to correct this and they refuse giving me some lame answer. 

My CPA says don’t worry it will balance out by setting the expense against it and it’s a wash. (my words and description not his)

I have never expensed the utility because the tenant has always reimbursed me. But now I need to save this and give the amount to the CPA.

I am concerned that it shows, however small, that the rental income is more than what was actually collected.

Is this really an issue for me, IRS? I don’t believe it’s proper bookkeeping. I did some research and found several articles that speak of the same situation where I am paying and get reimbursed from tenant clearly showing it’s utility and not income.