Understand ledgers

Summary

This article provides an overview of managing ledgers in Palace, detailing the different types of ledgers, such as Fee and Bond ledgers, their purposes, and the benefits of creating personalised ledgers for specific financial tracking needs.

This article covers:

  • About ledgers
  • Types of ledgers

About ledgers

Ledgers categorize different funds contributing to your bank balance. Each section of Palace has its own ledger, e.g. owners or suppliers. You can add ledgers to hold tenant funds or charge fees to owners or tenants. Palace provides standard ledgers, but users can also create customized ones.

When Can Ledgers Be Used?

Ledgers can be used in various scenarios, including:

  • Property Management - To track income and expenses associated with a property
  • Tenancy Management - To record tenant-related transactions such as rent payments and bond deposits
  • Fee Management - To monitor fees charged to tenants or property owners
  • Bond Management - To manage bond amounts received from tenants and ensure they are correctly allocated and refunded

Why Use Ledgers?

Using ledgers provides several benefits:

  • Organized Financial Records - Helps in maintaining a clear and organized record of all financial transactions
  • Accuracy - Reduces errors by providing a structured way to record financial information
  • Compliance - Ensures compliance with financial regulations by accurately tracking income and expenses
  • Reporting - Facilitates the generation of detailed financial reports for better decision-making

Types of ledgers

Fee ledgers

Used to track fees charged to tenants or property owners.

  • Examples:
    • Management Fee ledger - Tracks fees charged to property owners for property management services
    • Late Fee ledger - Records fees charged to tenants for late rent payments
    • Fixed Lease Break Fee ledger - Records fees charged to a tenant for breaking their lease. Once the fee is charged, it is receipted into this ledger, and the GST component is separated into the GST ledger. These amounts can be paid out through a Payment ledger, typically processed at the end of the month

Fee ledgers are crucial for monitoring additional charges beyond regular rent payments and ensuring they are appropriately accounted for.

Bond ledgers

Used to manage bond amounts received from tenants. These amounts are usually held as security for any damages or unpaid rent.

  • Examples:
    • Tenant Bond ledger - Tracks the bond amounts received from tenants and any deductions made
    • Bond Refund ledger - Records the refund of bond amounts to tenants at the end of their tenancy
    • Bond Other ledgers - These are ledgers that collect money and hold it until it is paid out again. It is not money earned by the company. I.e. Water rates - where the tenant pays the money, and it is held until the invoice is received. Then, the money is allocated to the invoice and paid to the owner

Bond ledgers ensure that bond amounts are accurately recorded and managed, making it easier to handle bond refunds and any disputes that may arise.

Personalized Ledgers

  • Maintenance Ledger - To track expenses related to property maintenance. I.e., Recording costs for repairs, landscaping, and general upkeep

By creating personalized ledgers, users can tailor their financial tracking to meet specific needs and gain better insights into various aspects of property and tenancy management.

System-created ledgers

  • Cannot be changed or archived
  • They are required by the system for various charges and commissions. I.e., Management fees. Some are just holding ledgers like the owner-control account
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User-created Fee ledgers

  • Can be edited, i.e. renamed and archived
  • Manually created to collect money that has been charged to your tenants or owners. i.e. Fixed lease break fee ledger. The money is charged to the tenant and receipted into the ledger, and the GST component is taken out and put into the GST Ledger. These can be paid out by the payment ledger, which is normally done at month end
  • The descriptions are shown in blue

 

What's next

You can learn more about how to add and manage your ledgers.

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