Many times, HOAs run into financial problems because board members lack financial skills or they use outdated processes. HOA accounting software is the best tool to prevent financial distress and ensure your HOA’s finances are healthy.
With that in mind, let’s discover how HOA accounting software works and how it simplifies bookkeeping for board members and managers.
What is HOA Accounting Software?
HOA accounting software is a digital platform that allows you to track your spending and issue financial reports. It centralizes a lot of functionalities that make it easier to perform day-to-day HOA finance tasks. Here are a few features that software for HOA accounting usually have:
- Allow residents to pay dues
- Track dues
- Issue invoices and schedule payments
- Generate balance sheets and financial statements
- Notify residents who are behind on their payments
- Store important HOA documents online
5 ways HOA accounting software makes your finances easier
1. No more messy spreadsheets
Many HOAs use spreadsheets to keep track of their association’s income. Using spreadsheets is a good start but it can easily become messy. When using spreadsheets you need to make sure everyone is using them the right way. Also, you have to update them regularly so they don’t become outdated. This requires a lot of work. In most cases, these spreadsheets are created by board members who are not finance experts. An HOA accounting platform serves the specific needs of community associations. By using such a solution, you’ll be using the best accounting practices for your HOA.
Not to mention you won’t waste time maintaining or improving spreadsheets anymore.
2. Track HOA fees and delinquencies easily
The best feature of an HOA accounting portal has is that it allows residents to pay their dues online in just a few clicks.
On the one hand, this functionality makes it easier for HOA residents to keep up with their payments. On the other, board members can instantly track who paid and who didn’t. This allows for better control of the association’s cash flow. This feature usually sends automatic reminders to residents that are behind on their payments. This helps decrease the delinquency rate in your community.
This also saves the board a lot of time. You don’t have to manually track payments and contact residents about their HOA fees.
3. Issue financial reports instantly
Since all of the financial information is centralized in the HOA accounting software, you can download complete reports in a matter of seconds. You can easily print and send them to other stakeholders. You can also save and send them by email to your residents to increase transparency. Having the ability to generate instant reports saves you a lot of time. And, it also allows you to always keep an eye on the financial state of your HOA. This eliminates nasty surprises and makes you more proactive.
4. Smooth HOA board transition
Right after an HOA election, new board members transition to their new roles. This can be a challenging process. The newly elected HOA treasurer needs to understand the financial processes in a short period. If the spreadsheets are messy and documents are not centralized, it makes things a lot more difficult for the new treasurer. This can harm the well-being of your HOA.
The best thing a board of directors can do is to hand over a centralized process. By having previous records and important financial documents in one place, the new HOA treasurer won’t feel lost. HOA accounting software helps you do that. Since all the financial history is stored there, there won’t be room for confusion or even lost hard copies. The transition will be smooth and residents will be happy about it.
5. Clear financial picture anytime, anywhere
In general, an HOA accounting portal is accessible from any desktop. You just need to enter your login information and have an internet connection. As a board member, this means you can access the software and work on your task from the comfort of your home. If you have an accountant or a manager, that person doesn’t need to come repeatedly to your HOA. They can work on your association’s finances from their offices and go to your community only when there is a real need. Having this system in place allows for better collaboration between different stakeholders.
For those who are always on the go, an HOA accounting app is usually available too. This is a great solution for community association managers who are often visiting communities or attending HOA meetings. An HOA accounting app allows them to keep an eye on income and expenses by just opening the app on their mobile device or tablet. Most companies offer both solutions in one, letting users choose if they prefer to use the desktop version or the app one.
The ideal solution? A complete HOA management software
Implementing HOA accounting software is a great way to keep your finances on track. However, it will only tackle one aspect of your HOA management. As you know, managing an association goes way beyond bookkeeping and budgeting. Board members take care of common areas, community events, and much more.
This is why investing in an HOA accounting software that doesn’t come with other management features is often not the best decision.
Choosing a solution that tackles every aspect of HOA management will simplify all redundant processes in one single place. Aside from the accounting features we mentioned in this article, here are a few features that HOA software usually has:
- Send notices, emails, SMS, smart calls
- Manage and reserve amenities
- Track packages
- Manage maintenance requests
- Create a personalized HOA website
- Conduct HOA inspections
Final points
Implementing a strong system for managing your accounting is essential for the well-being of your HOA. It saves the HOA treasurer and the accountant a lot of time. If you are looking for a collaborative tool that simplifies daily processes for the whole board, then HOA software is better.
Click on the image below to learn more about Quickbooks, one of the most powerful accounting software in the market that fully integrates with HOA software.
