Service Charge Accounting
Service Charge Accounting is one of the most important aspects of property management.
A requirement of law and nearly all Leases, it is essential that Service Charge Accounts are presented to owners in a timely fashion to ensure that they are both notified of the expenditure incurred, and of any balancing payment or credit which may be required following the completion of the year in question.
Block Management UK Ltd accounts for over £6.5m in service charges per year and administers over 200 separate bank accounts on behalf of clients.
Our in-house accounts department can monitor ongoing expenditure on a daily basis and budget for expenditure based on both costs incurred in previous years and known forthcoming expenditure. A forecasted budget is then set with the client. Should costs change, we will report to the client on the impact on the budget forecast. We advise on options for future budgets in a fully transparent and adaptable fashion that allows clients to retain overall control of the process whilst reflecting the provisions of the leases/TR1s.
We also advise on payment plans, ad-hoc charges, expenditure control and invoicing.
Block Management UK Ltd work hand in glove with a number of specialist Service Charge Accountants in order to ensure that the relevant requirements are met when it comes to legalities, and to ensure the highest level of transparency of where money has been spent in each period, allowing you a detailed insight into where money has been spent, and more importantly why those funds had to be spent.
We comply with the Accounts regulations of the Royal Institution of Chartered Surveyors (RICS). Our main duties and responsibilities are:
- maintain adequate bookkeeping procedures
- prepare service charge accounts for the Client
- supplying financial reports to the Client (current service charge balances, supplier balances and service charge bank balances.)
- deal with queries raised by auditors
- preparing and send out service charge estimates, collect service charges and reserve fund contributions
- process payments relating to the property within funds available or as reasonable expediency shall dictate
- send statements of account to Lessees in respect of the charges incurred in managing the Building
- send statements of account to the Lessees in respect of ground rent payable under the terms of the Lease
- receive, validate, authorise and pay invoices incurred by the client calculation of service charge contributions based on the percentage payable for each relevant Unit
- notify Clients of expenditure incurred and of any balancing payment or credit which may be required following the completion of the year in question
- maintain an up-to-date database of all property owners, keeping and updating records of all relevant owners of Units within the property and the residents’ and tenancy details
- ensure that all information (including computer records) are secure and to comply with the Data Protection Act 1998 and GDPR and to indemnify the Client against all claims and legal costs arising in respect of failure to comply with this obligation
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