Budget Boost (JPM)

Make Your Financial Planning Process Easier to Manage With Automation

by Ranjeev Teelock

The following is an excerpt from the Jul/Aug 2010 issue (Volume 75, Number 4) of JPM, Journal of Property Management.

Few business rituals cause more angst or generate more hours poring over spreadsheets than the annual budget. This complex process affects staff at every level of an organization - from the CFO to the regional managers, to the site managers - and usually takes months of effort to complete.

Owners and managers of multifamily property management companies face the budgeting process every year. As these companies grow and the need for better resource management becomes even more important, improving and streamlining the budgeting and forecasting process becomes paramount.

THE “OLD” WAY
Everyone knows the drill. Several months before the end of the fiscal year the call goes out to site managers of all the properties owned or managed by the property management company. Typically, a standard spreadsheet workbook is distributed, either through the mail or via e-mail, to each site manager so he or she can collect and calculate budgeting data for each community. Deadlines are set, and the spreadsheets are distributed through the approval process. Finally, the completed spreadsheets are mailed or e-mailed back to the central office. Multiply that step by the number of properties in the portfolio and it is easy to see how the complexity increases exponentially.

Then, the heavy lifting begins. Budgeting data must be collected from all the different properties, as well as data from other disparate sources. This manual process usually means weeks of number crunching and plenty of “re-dos” as data is constantly being updated and changed at the last minute. By the time the budgets are finally completed, everyone is exhausted from the effort and probably a little leery about the accuracy of the final numbers.

AUTOMATION SIMPLIFIES THE PROCESS
Property management companies need a better way to manage the annual budgeting exercise. A company needs to have confidence in its financial data, but manual processes increase the risk of errors and make timely reporting almost impossible.

A powerful Web-based budgeting and forecasting tool that automates the process enables owners and managers to create, manage, distribute and centrally monitor budgets for all property types in their portfolio.

The full article is available as an online exclusive in the Jul/Aug 2010 issue of JPM, Journal of Property Management.

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