AppFolio accounting

Investor · Greenville, SC · Member since 2016 · 5k+ posts · 13k+ votes

My PM uses AppFolio and apparently it can not produce standard accounting reports (P&L, T12 and rent roll). Can anyone confirm this or help me coach the PM? I need these reports for the bank and for general analysis (and so that I can spend time on investing instead). Absent an AF solution, I will have to key monthly owners statements into Quickbooks or some other accounting software.

On a side note, would also like the system to be able to accept journal entries for items that I pay for myself so that we have a full set of books (insurance, taxes, materials on occasion, occasional direct payment to a contractor, tax prep fees, other admin fees). My PM is telling me the only way to handle this is with an actual cash transaction.

Thanks for the help.

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Jeff Gates

Investor · Cathedral City, CA · Member since 2014 · 481 posts · 170 votes

10y

Wow, sounds like the operator, not the machinery.

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Nathan MillerPro Member
Property Manager · Grants Pass, OR · Member since 2009 · 429 posts · 202 votes
10y
Hey Mike, Your PM might not know the capabilities of their software as I'm relatively certain that AF has at least a P&L and Rent Roll. Maybe it's their policies that are preventing them from providing you the info or something, which would be too bad.
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Atwan Kwan
Property Manager · Rockville, MD · Member since 2014 · 287 posts · 29 votes
10y
call appfolio and have the PM on the call as well.... any mgmt trying to keep up with the market invests heavy in customer serv and especially educ to implement.
buildium went out of their way to teach me how to add and subtract, even without me putting in a penny
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Mike Dymski
OP
Investor · Greenville, SC · Member since 2016 · 5k+ posts · 13k+ votes
10y
@Gita Faust Thanks for responding. I moved your reply below to a more recent post of mine.
https://www.biggerpockets.com/forums/80/topics/315...
Please bear with me as I get up to speed. Are you confirming that AppFolio is not able to produce standard accounting reports (P&L, T12, rent roll) and that I will need to key AppFolio data into another package to produce them?
The PM uses AppFolio and I have general reporting needs as a client and property owner.
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Gita FaustBusiness Member
Accountant · Richboro - Philadelphia, PA · Member since 2008 · 908 posts · 247 votes
10y
@Mike Dymski Take 2 -
You are able to get P&L (as you call it) and rent roll from AppFolio not sure about T12.
A property manager should never give the landlord a Profit & Loss because they do not have a 360 view of your financials. The report they give you is not Profit & Loss it is an owners proceed summary. Till a Landlord adds their income and expenses it is not a true PL.
From the PM all you would need to do is add the summary every month.
The way you would enter them depends on what reporting and analytics you are looking for.
For example capital improvements. You should enter them by date and what you replaced. This will be easy to depreciate at the end of the year.
Knowing your equity every day, month is crucial to make the next deal that comes your way.
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Mike Dymski
OP
Investor · Greenville, SC · Member since 2016 · 5k+ posts · 13k+ votes
10y
@Gita Faust Thanks, sorry for the delay in getting back. I receive an "owners statement" which is a list of transactions that nets down to the cash settlement. It's the nuts and bolts of our monthly settlement and works well for that but it has no additional reporting utility. I will come back to it in a minute.
The PM can supply a "cash flow" report as well, which looks like a P&L but is very summarized and is only for one period (whatever data range is specified), not a T12. She has confirmed that AppFolio does not provide a P&L, she used to have one with her last vendor and that her larger clients have complained about not having one now.
The PM says that AppFolio does not provide a rent roll. I will call AppFolio as I am hearing something different here.
It's not unusual for PMs to supply full P&Ls. I have seen many of them when performing due diligence on potential acquisitions; so, not sure what they are doing versus AppFolio clients. I plan to call a couple of MF PMs this week. One of the brokers I work with uses a PM for his apartments who provides them with a QuickBooks P&L every month and can run a T12 and rent roll anytime for any period.
It appears that I may have to create my own books from the transnational data provided by the PM or outsource it. AppFolio appears to be a property management tool but not an accounting/reporting tool.
@lisa doud in case you have name in keyword search
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Gita FaustBusiness Member
Accountant · Richboro - Philadelphia, PA · Member since 2008 · 908 posts · 247 votes
10y
@Mike Dymski In reference to naming the report whether it is Profit & Loss or Owners Proceed - it is always in a name and the company providing the reports liability.
I would strongly recommend all property managers to take a look at their agreement and discuss it with an attorney. I have clients who have got sued and others change their agreement letter per our advice. One does not want to take the responsibility to give the landlord a Profit & Loss and Balance Sheet unless they are providing a service.
Right in QuickBooks you can run rent roll, owners proceed, Profit & Loss, security deposit, last month, lease expiration date, and my list goes on and on.
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Simon W.Business Member
Real Estate Consultant · Lehigh Valley PA & New York City · Member since 2013 · 1k+ posts · 691 votes
10y
reading this got me confused.
Did you hire a PM or a Property management company?
Usually PM do not give any type of reports since they aren't accountants.
A mgmt company might do so since they usually have in-house accountants and charges you an Accounting Fee.
To make things more simple, keep your PM and your accounting dept separate.
Accounting Properties LLC
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Mike Dymski
OP
Investor · Greenville, SC · Member since 2016 · 5k+ posts · 13k+ votes
10y
@Simon W. Thanks, sorry for the confusion. I'm using a property management company.
Regarding separate systems, I feel that property accounting is pretty basic and entering the same information in two different systems is inefficient (PMC enters the rent and expenses and then I have to reenter into QuickBooks for accounting). If that is what you get with AppFolio, I am stuck with it but just vetting any potential better solutions with the members here. I spoke with two MF PMCs yesterday and they provide their clients with more robust reporting (rent rolls, T12s). There is a bit of a PMC void in the 10-50 unit MF space in my market as the MF PMCs do not service this space and the SFR PMCs are not set up for MF (i.e. no MF vendors for turns, no accounting). I knew that going in and just working through those challenges.
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Simon W.Business Member
Real Estate Consultant · Lehigh Valley PA & New York City · Member since 2013 · 1k+ posts · 691 votes
10y
@Mike Dymski, not a problem.
I am a Property Controller/Accountant so I know what you mean. Check your contract with them and see if you are paying accounting fees on your property's expenses. If they are charging you accounting fees, they should be producing T12s, RR, P&L, Balance Sheet, and Cashflow. CF is pretty much a more detailed P&L with adjustments to make reflecting actual cash.
I started my own accounting co for RE investors and my basic package is always to offer the Financial Reports so definitely those 3 main ones should be avail to you.
Your PMC shouldn't be that difficult. If they have competent accountants then it should be a breeze to produce those financial statements for you.
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Peter MacKercherBusiness Member
Residential Real Estate Broker · Saint Louis, MO · Member since 2014 · 1k+ posts · 567 votes
10y
@Mike Dymski We use AppFolio for my PM company, and it has brought a lot of efficiency in some areas, and frustrations in others. Yes, the accounting isn't as robust as you might expect/hope for. They also misuse some terms with what seems to be the intention of annoying accountants to no end (i.e. using the term "rent income" for gross rents, for example).
I've only delved into the accounting side of AppFolio minorly, and not enough to give a verdict on it, but I will say that they are responsive to implementing new features. The data you'd require for those sorts of reports should be available so it's a question of getting the implementation shoved forward on their development list.
[email protected]
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Mike Dymski
OP
Investor · Greenville, SC · Member since 2016 · 5k+ posts · 13k+ votes
10y
@Simon W. @Peter MacKercher Thanks for the reply and the confirmation.
Simon, I pay a flat fee of 8%. They do not have any accountants on staff.
In the end, I am more concerned with the management side and thought I performed the right due diligence on the accounting side when vetting PMCs but sounds like I will need to pick up the accounting. The longer term solution is a larger property with more efficiency. Thanks for the help.
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Todd Earley
Property Manager · Alpharetta, GA · Member since 2015 · 1 post · 2 votes
10y
AppFolio definitely has these reports. They are under "Reporting, Accounting reports". They can pull them up by owner or by property and filter them by any date range your require. They can be sent to you via xls. csv. or pdf. formats. We send them out to our owners upon request and everyone gets the IS and CF reports with the year end numbers for 1099/tax purposes.
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Jeff Gates
Investor · Cathedral City, CA · Member since 2014 · 481 posts · 170 votes
10y
Wow, sounds like the operator, not the machinery.
3 Reply
Drew Dillon
Member since 2018 · 14 posts · 2 votes
5y
@Gita Faust is there software that has a one stop shop for investors ? Accounting, deal analysis, expenses, leases, calendar for reminders for inspections, applications, background checks, etc
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