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ABC will eliminate duplicate entry and drastically reduce accounting
closing times, automate the recording of capital activity throughout an
ownership structure, automate accounting consolidations on multiple
sets of books and auto-generate quarterly investor reporting. It will
process performance calculations such as IRR, and it will generate
automated submission files for NCREIF and GIPS reporting. And the
kicker? The properties in ABC’s portfolio will be managed directly
in ABC’s system, so that critical operating information is already
present without the need to transfer data from a third-party property
management system.
The implementation of the vertically integrated platform described
above will result in significant efficiencies for the existing work force.
Efficiency gains will allow ABC’s highest level accounting employees to
focus on value-add activities, rather than exhaustive “tick and tie” review
of manually prepared monthly reports. These valued-added activities
may include financial modeling of future business lines, or taxable
income projections so the principals can make accurate quarterly tax
payments. Lastly, ABC’s team will be able to respond much more quickly
and accurately to investor inquiries, whether in the office or in the
airport, because of the automation, and because the system is mobile
enabled and can be accessed from anywhere in the world using a
mobile device.
With such a system, ABC can expect to reduce its planned future
hiring significantly. For example, if ABC reduces its future hiring by
only one divisional controller and one accounting staff member, they
can save $175,000 per year in employee costs, which can be used to
offset the annual licensing fees for the solution. If ABC is able to cut
one additional Accounting Staff from its hiring plan because of the
implementation of this solution, then ABC may profit by virtue of
selecting and implementing a comprehensive solution, as well as realize
all the benefits offered by this solution. In reality, such automation can
reduce the need to hire staff much more dramatically.
Dallas-based real estate investment company and Yardi Voyager® user
Encore Enterprises Inc. provides real-world testament to the value of
an integrated solution. “When we evaluated software systems we were
looking for a solution that would combine our entire portfolio into one
version of the truth,” said Mahesh Shetty, chief operating officer and chief MORE THAN 5200 EMPLOYEES,
financial officer for Encore. “Yardi Investment Management™ satisfies
all of our vertical market management obligations while eliminating
the reconciling issues that came with the manual exchange of data
between systems. It allows us to have full portfolio oversight and lets us
manage the entire investment cycle in an automated fashion, from the
investor to the individual asset, and follow that cycle all the way through
distributions and investor reporting.”
Now Think About Your Business
Is your accounting team plagued by inefficiencies and errors because
they are using multiple systems to capture and report transactions?
How disruptive would it be for a key employee to leave today because
they “know where all the bones are buried” and how all of the different
pieces of your firm fit together? What’s your accounting hiring plan
over the next three years to meet the demands of your anticipated
growth? When you evaluate your firm’s future, remember that the
numbers referenced above from Robert Half were the lowest end
of the national average salary range for the lowest range of salaries
for each position. If your firm is larger and/or located in a major
metropolitan area, the annual estimated cost of new employees
may be significantly higher than what is presented above, making
the purchase of a comprehensive technology solution even more
attractive.
Greg Fuhrman is a regional account executive for Yardi ®,
specializing in Investment Management. His previous
experience included six years with Ernst & Young in the
Kenneth Leventhal Real Estate Group. He also worked for
Pacific Coast Capital Partners (PCCP) as the first employee
in the accounting department. As PCCP’s chief accounting
officer, Greg managed several hundred entities in multiple
funds with institutional investors and was responsible for all accounting, financial
reporting, tax structuring and planning, including system selection and
implementation. He also spent five years helping raise capital for startup companies
with innovative technologies.
Technology changes.
Building dynamics don’t.
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