Auditing is essential for keeping up with all of your accounts. However, it is a painstaking and laborious process fit for accounting firms. Frankly, the procedures will be challenging for non-specialists. Balanced Asset Solutions has seasoned experts that are more than well-equipped to handle in-house audits and bank reconciliation.
As you continue scaling your business, the volume of transactions will also begin to increase. Tasks that were handled easily in the early years may suddenly balloon to a mess accounts and ledgers that may be tough to control. There may also be a dramatic increase in areas that need closer scrutiny to maintain compliance. What used to be easy may become riddled with inconsistencies and errors.
Balanced Asset Solutions can help lift these inconsistencies and improve your system.
Bank Reconciliation Audit
- Receivables
- Payables
- Reconciling bank accounts to trust account balances
- Reconciling adjusted cash balances to bank balances
- Work to ensure that there is enough cash at the bank to cover one or more trust accounts
Trust Account Balance Audit
- Ensure that the general ledger is reconciled with the owner statement and the trust account balance.
Security Deposit Audit
- Ensure that there is sufficient cash at the bank to cover security deposit liabilities
Generate Accurate DRE Specific Reports
- Preparing the cash flow statements
- General ledgers
- Trust Account balances
Liaison Between the Auditor and Property Manager
- Balanced Asset Solutions will work with the DRE author to ensure that there is proper communication and clear understanding between parties.
How It Works
What Auditing Is
We at Balanced Asset Solutions believe that auditing can be a painless procedure in the future if your business can maintain compliance and stay as organized as possible. You can achieve this state while working with our seasoned accountants and experts. It’s not true auditors are “out to get you.” However, any inconsistencies or errors after a bank reconciliation or a three-way reconciliation need to be addressed immediately to avoid an auditor’s visit.
3-Way Reconciliation
2-way reconciliations are more common, but a 3-way reconciliation displays the state of your accounts more effectively. In the process of handling a trust account, there are two ledgers. The first ledger is the check register or what we call the book balance. The first ledge reflects the balance of your bank account in its entirety.
Then there are individual client ledgers. The client ledgers, on the other hand, reflect the trust funds of each of your customers. The sum or total of the client ledgers must equate to the total of the bank balance and the first ledger (the book balance).
Inconsistencies and deficiencies in these records will likely appear. Deficiencies may point to a faulty system or simple things such as forgetting to post bank charges. Reconciling can be extremely challenging at this point. Reconciliation should ideally be performed on a monthly basis. Any errors that we might find must be resolved immediately. We are also vigilant of fraudulent transactions that may have been charged against your trust account.
We can help examine the checks and balances throughout the existing accounting system. This will show how well your team is reconciling various transactions that naturally take place monthly. We will also aid in setting up a more effective property management software for you.
DRE Auditing
DRE auditing is a form of regulatory examination performed by a DRE auditor. The center of a DRE audit is how your trust fund is handled. The DRE auditor takes a closer look at your business operations, licensed activities and how your accounting trust has been set-up.
The DRE audit will also examine your requisite records, how the trust funds are being handled, if there is proper accounting and of course, account reconciliation.
Balanced Asset Solutions can work with a DRE auditor to ensure the audit goes smoothly. Rectification and compliance are key to ensure that the audit proceeds properly. We can help evaluate your business’ compliance before the audit takes place. We can help detect any violations and possibly correct them before the DRE audit takes place. If not, steps can be taken to resolve these violations.
We can help explain to the DRE what took place, how we came to know about the violations and what steps are being taken to ensure compliance the soonest possible time. Compliance issues often take property owners off-guard and having no prior knowledge of these issues can place your business in hot water.
