New York's Cooperative and Condominium Community
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Three nifty tools to streamline your building's invoicing and bill collecting.
How can managing agents and boards bring their buildings into the 21st century? Three nifty tools for casting some number-crunching and file-sharing magic for invoicing.
As the treasurer of his own co-op board, Andy Ashwal goes through a regular ritual with his managing agent: “She either e-mails me a stack of invoices that I have to print out and then review and sign, or she leaves me a package at the desk and I have to look through it and sign it. And if I have questions, I put a little sticky Post-it note on it and send it back to her. Then she e-mails me or calls me with the answers to the questions.”
How quaint. How 20th century.
Things are different, however, when Ashwal himself is in the driver’s seat, as executive director at KW Property Management and Consulting. At KW, things are becoming more streamlined: the firm is gung-ho on a new system it is introducing in a handful of its buildings called NexusPayables. More George Jetson than Fred Flintstone, the set-up offers a number of advantages, according to Ashwal.
To begin with, invoices are scanned into the accounts payable system, and managers get the invoices as well as a general ledger code. They can see the invoice on the right-hand side of the screen and the numbers on the left-hand side, easily comparing how much is spent against the budget line item. They can make notes in the section, to approve or reject it. “It’s much better because it’s easier to review,” he notes.
Ease is the name of the game, and Ashwal is part of a new breed of modern manager who use technology to stay connected to their clients.
At KW, after the manager reviews the scanned material in NexusPayables, the invoice goes to the treasurer for approval or rejection, and then to accounts payable, where compliance is double-checked. Press a button and checks are printed.
“We are now capturing the treasurer’s electronic signature,” says Ashwal. “If a vendor or treasurer calls, I can go into the system and see that an invoice was rejected for a particular reason – say, they didn’t complete the work. There is a lot more transparency to the process now, which has often been very closed [in the past].”
There are other advantages. If a vendor is not recognized, that could alert the manager that the firm is not in the system. “This could mean that the company hasn’t completed a W-9 or doesn’t have insurance,” Ashwal observes. “You don’t want contractors without insurance, and you need a W-9 for the accountants who will do an audit.”
A big advantage of the new system, says Ashwal, is that “board members and treasurers will have more visibility in the accounts payable process. They will have more oversight on who is being paid, what the payables are versus what the budget is – they will be more involved in the process of managing their property. This should be a collaborative process. It’s saving time. It also helps when budgeting because you can see what you have been paying.”
KW, whose Florida-based parent company has been testing the system since January, introduced NexusPayables to its New York boards and associations in July. “We sent an introductory letter explaining what we are doing. We have a board of directors’ manual with instructions. Accounts payable will be doing webinars to train board members. We are making the investment of time because if board members don’t know how to use the system, it is a waste of money,” says Ashwal.
“We are using New York as our test market for it because we feel New Yorkers are more technologically savvy,” he adds, noting: “It’s incumbent on property managers to bring property management into the 21st century.”
Filing in the Clouds
Deirdre McIntosh-Brown, board president of Hamilton Heights Community Development Housing Fund, a 133-unit co-op, was fed up. Every month, her management firm, HSC, sent her a dozen or more e-mails that she felt were unnecessary. The manager would try to send the monthly 300-page management report and invariably – because the file was too big – he would break it up into 12 or more segments. “Some might end up in spam, or you couldn’t see the documents clearly,” she says.
McIntosh-Brown talked with Josh Koppel, the president of HSC Management, about using the five-year-old Dropbox file-hosting service. The “cloud” storage system lets you bring all your documents, videos, and photos anywhere. Installing the free Dropbox software creates a special folder on your computer. Anything you add to the folder automatically saves to all your devices – computers, phones, tablet – and to the Dropbox website. You can access these files while out and about, and easily share them with others, including those who don’t have a Dropbox account.
“It’s unbelievably better,” says Koppel, who has been employing the system since May 2013 to distribute monthly financial statements to boards. These can include bank statements, reconciliation, cash flow, check registry analysis of charges and collections for all residents, copies of bills paid, open invoices, a detailed general ledger, and more.
“With Dropbox, everything is in one place; it looks better and is clearer,” says Koppel. Furthermore, Dropbox stores each monthly statement in the archives. “When board members change, you can delete them from the system.”
Once Koppel decided to go with Dropbox, he sent notices to his clients about the change. “You can share the box via a link. It’s safe, confidential. You get notification when something has been added to the box. It’s made life easier.”
McIntosh-Brown agrees. “When we get documents in the box, I can get on the phone with Josh or other board members and can quickly do a conference call. We can all see the documents,” she says. “I can break things into folders and share a portion of the information or all of it, which is important. I’m thankful our management company is open to new ideas. We have information at our fingertips, can get it on our phone, tablet, or computer.”
Koppel recently started using the service for his purchase applications as well. “Dropbox saves time,” he explains. “Our staff was spending at least two full days with the monthly statements, and we’re not spending that kind of time now. I’m able to download my monthly statement in the computer. It’s paperless and that saves me money – and it ultimately saves the building money.”
Many shareholders/unit-owners like to use electronic banking to pay their bills. Commonly known as ACH – which stands for Automated Clearing House – this system processes large volumes of credit and debit transactions in batches. ACH credit transfers include direct deposit payroll and vendor payments.
Wouldn’t it be great, though, if there were a system that let you pay your maintenance or common charges with a credit card? Some feel that’s more convenient than writing a check – and you could earn bonus points or airline flight miles. Many say they’d be only too happy to pay for the convenience of it all.
Well, wonder no longer, because the system is here. Launched in 2009, and currently operating in 33 states, ClickPay processes ACH payments, recurring payments, and debit and credit card payments. It also partners with some small banks to offer these services.
In May, Matthew Adam Properties started using ClickPay. “Our clients can go online, enter their account number, and pay their rent, maintenance, and common charges,” says Ira Meister, president of the management firm. “People can see a history of payments. They can pay by credit cards. It’s what people want.”
He says the electronic payment platform also provides better reporting. Before, the company had what he calls a “basic system.” It didn’t offer capabilities that clients sought, such as being able to pay by credit card or having a history of payments at their fingertips. While some companies charge shareholders to make such payments, Meister says his does not.
Many managers did not offer the credit card option to avoid paying three to four percent in fees to the credit card companies, says Meghan Sheehan, vice president and director of sales for ClickPay. ClickPay has changed that. The shareholders or unit-holders can pay maintenance or common charges via credit card, but they have to pay a monthly fee for the service. The manager and the co-op/condo are thereby off the hook. The fee for each transaction is currently less than four percent of the bill. It is waived if the payee uses an ACH system (currently about 85 percent of users).
It’s not only residents who are happy – so is Matthew Adam Properties, which is already seeing positive results. Explains Sheehan: “Property managers get collections faster because they don’t have to wait for mail, then deposit the money, and wait for it to clear. There is an advantage for the property manager and the board. The process is automated, so you can post collections without manual entries. ClickPay creates operational efficiencies for property managers. There are electronic reminders to pay rent or dues. People can set up payments. It’s good for members and allows flexibility for owners.”
But ClickPay’s real estate-specific platform offers more than standard banking. “Banks usually have a basic system for all industries. It’s not user-friendly and cannot be customized as needed for each property manager,” says Sheehan. ClickPay easily integrates with most real estate accounting programs and other portals such as BuildingLink. It also offers e-billing.
Although there were a couple of minor start-up glitches in the initial use of this electronic payment system, Meister says they were quickly resolved. He likes that shareholders who have questions or problems can contact ClickPay directly. “Mostly, though, the feedback from clients has been very positive.”
Learn all the basics of NYC co-op and condo management, with straight talk from heavy hitters in the field of co-op or condo apartments
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