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Key Terminologies in Property Management Accounting

The presentation by EXO Edge provides an overview of key terminologies in Property Management Accounting, essential for understanding financial operations in real estate. It begins with fundamental financial terms such as Accounts Payable (AP), Accounts Receivable (AR), General Ledger (GL), Cash Flow, and Net Operating Income (NOI), which help track financial obligations and earnings.

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Key Terminologies in Property Management Accounting

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  1. Key Terminologies in Property Management Accounting Presented by EXO Edge

  2. Important Financial Terms 1. Accounts Payable (AP) – The amount a property management company owes to vendors and service providers. Accounts Receivable (AR) – Money owed to the property owner or management company from tenants. General Ledger (GL) – A record of all financial transactions categorized into accounts. Cash Flow – The net movement of cash in and out of a property or company. Net Operating Income (NOI) – Revenue from property operations minus operating expenses, excluding taxes and financing costs. 2. 3. 4. 5.

  3. Lease & Expense-Related Terms 1. CAM (Common Area Maintenance) Charges – Fees tenants pay for maintaining shared property spaces. Escrow Account – A separate account for holding funds, typically for property taxes and insurance. Operating Expenses – Recurring costs necessary for managing and maintaining a property. Depreciation – The reduction in a property's value over time due to wear and tear. Tenant Ledger – A record of all financial transactions between the tenant and the property management company. 2. 3. 4. 5.

  4. Reporting & Compliance Terms 1. Profit and Loss Statement (P&L) – A financial report summarizing revenues, expenses, and profits over a period. Balance Sheet – A snapshot of a company's financial position, including assets, liabilities, and equity. Rent Roll – A report listing rental income, lease terms, and tenant details. Accrual vs. Cash Accounting – Accrual records revenues/expenses when incurred, while cash accounting records when cash is exchanged. Budget Variance Analysis – The difference between projected and actual financial performance. 2. 3. 4. 5.

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