Is Buildium a full service accounting program???

Question

So this might be a complicated question but those know their accounting / bookkeeping well, should know this… I'm getting conflicting answers between my accountant and bookkeeper. The problem is convincing my VA bookkeeper she's wrong, but other people agreed with her in the past. Either way I don't know the correct answer and that needs to be fixed!

I have been using building for a year now and love it! My business set up is complicated, too me and if anyone else has suggestions let me know. Please do not give me legal advice about the setup, I know the flaws. I just need straight accounting principles or whatever you want to call my mess.

I have my management company in buildium for rent collections we can call it a rent management company. It does not make any income for repairs or anything that has to do with managing, just rent collection. I didn’t want to co-mingle funds with different llc’s in my own name. For example, one llc property deposits the money in my personal bank account, then I make the deposit in the proper llc account.

To keep things simple, I have a rent management company, then lets say I own 5 in my personal name, 5 in my llc, and then I manage 5 properties in another llc for another person. All my llc’s are single membered, not that it matters. Everyone makes the rent payment in buildum to the rent management company then gets distributed accordingly. Now this is where it might get complicated… I need to make active more active income. So all of the income from the property management fee’s I collect are in my personal name and all of the repair profits are also. So I’m a vendor in there that gets paid for this.

I really don’t think my bookkeeper is squeezing me for work, because she can barely keep up with what I give her now but she is telling me that I need a separate quickbook file for each of my llc’s to properly track everything and not to keep the expenses for the llc in buildium because it messes everything up. I don’t get why? I did have a few people tell me this before which is why I’m not convinced that my bookkeepers wrong.

My accountant looked over everything today and ask me why do I have all of these separate quickbooks file? She was telling me that buildium tracks all the expenses on the properties and that is what she needs.

So I guess my question is, is buildium a full service accounting program for the goofy situation I have? I have heard people complain before about their property reports but not this. I think its common also to have a set of quickbooks and buildium account.

THANKS!

Nathan Gesner · Answer

If I understand you correctly, you've set things up wrong.I'm a property manager with many accounts for many different owners, including myself. Each owner is what we call a portfolio. Each portfolio has all the properties belonging to that owner. It looks like this:PETERSEN RENTALS - 123 Apple Street (SF home) - 211 Circle Dr (16-unit complex) - 555 Long Street (four-plex)ELECTRIC SAGE LLC - 119 Wicker lane (SF Home)BARRY FAMILY TRUST - 757 Airline Drive (SF Home) - 127 Basket Street (SF Home)In Buildium, you should have two bank accounts. I name them according to purpose:Homeowner Operating Trust: all rent income for all properties goes into this account. When the Tenant pays rent for 123 Apple Street, it goes into this account but Buildium knows to tie the income to the property, 123 Apple Street, and to the Portfolio, PETERSEN RENTALS. After receiving rent for all three properties at PETERSEN RENTALS, then I send the owner a "draw" and transfer the funds to his account. All the money pours into the same account but your software will keep track of who the money belongs to so it is not considered "co-mingling".Security Deposit Trust: This is the account where we hold security deposits. All payments tagged as a security deposit will go into this account and stay there. We hold the funds until the tenant is out and the lease is terminated. Then we transfer the funds to the Homeowner Operating Trust and either apply it towards charges or refund it to the tenant.In my case, I manage properties for other people so I have to have separate bank accounts for my properties because the law requires it. If you are only managing for yourself, you should only need two bank accounts.At the end of the month, you should move all the money out of your Buildium accounts and send it to your private LLC accounts. This keeps everything clean in Buildium and once the money hits your LLC account, you know it's "earned" and that you are free to spend it.I think part of the problem is that you have your company in Buildium with the different LLCs under that and the properties under them. I would remove that top layer and treat each LLC as a different portfolio/owner. Buildium should track all income, all expenses, and all owner payments. I can't think of anything you need in Quickbooks.

Ryan Delauz · Answer

If you need 2 bank accounts in buildium does that mea. You have to pay that $99 bank account setup fee twice?

Aaron D. · Answer

Everything is automated except for the accounting portion; cannot do things like in QUICKBOOKS. Automatic journal entries every month are a no no. Must only do manual in Buildium. The reconciliation is automatic. You also cannot have a recurring depreciation entries and there is a recording issue if one is paying mortgage payments outside of Buildium .

Nathan Gesner · Answer

@James W. I don't understand the specifics of how it works behind the scenes. Buildium will have you fill out paperwork that authorizes them to transfer funds with your bank. Within the Buildium software, you will see when a tenant deposits a payment or when a payment transfers out to an Owner or Vendor. It's completely automated and really simplifies your life.Learn about online payments here.

James W. · Answer

@Nathan G. Thanks--so they have a login to whichever bank you use and confirm that the ACH transfers have taken place?

Nathan Gesner · Answer

@James W. they do not act as a bank. The integrate with the bank to move funds in/out of accounts and track where it goes but they do not hold the funds like a bank does.

James W. · Answer

@Nathan G. That was a really good explanation. Question on Buildium: they actually operate as a bank as well? Or is it just tying the accounts together with the in/out streams?