Real-Estate Fund Accounting: What Sponsors Need from Their CPA
Use this worksheet alongside the guide. The figures and schedules are educational illustrations, not individualized tax advice or a recommendation for your circumstances.
Work through your records
Read the explanation in the guide before filling in the schedule. Keep the illustrated values separate from your actual records. For each row, identify the supporting document, applicable period, unresolved assumption, and person responsible. Do not treat example percentages or classifications as established facts for your situation.
Schedule
Reconciliation
Decision supported
Your records / questions
Property reporting
Property detail to entity ledger
Operating performance
Investor capital
Contributions and distributions to bank activity
Capital administration
Intercompany
Reciprocal balances and fees
Group cash movement
Debt
Principal, interest and covenant definitions
Financing and liquidity
Tax coordination
Book results to tax adjustments and allocations
Estimates and K-1 preparation
Income statement
Quarter
Your records / questions
Rental revenue
$120,000
Property operating expenses
($45,000)
Net operating income in this example
$75,000
Interest expense
($30,000)
Book depreciation
($20,000)
Net income
$25,000
Cash flow bridge
Quarter
Your records / questions
Net income
$25,000
Add back noncash depreciation
$20,000
Cash from operations
$45,000
Loan principal repaid
($15,000)
Investor distributions
($10,000)
Net increase in cash
$20,000
Opening cash
$100,000
Closing cash
$120,000
Book capital rollforward
Quarter
Your records / questions
Opening book capital
$400,000
Net income
$25,000
Investor distributions
($10,000)
Closing book capital
$415,000
Balance sheet
Opening
Closing
Your records / questions
Cash
$100,000
$120,000
Property, net of book depreciation
$900,000
$880,000
Total assets
$1,000,000
$1,000,000
Loan balance
$600,000
$585,000
Book capital
$400,000
$415,000
Total liabilities and book capital
$1,000,000
$1,000,000
Cadence
Accounting work
Sponsor decision or approval
Your records / questions
Monthly
Close banks, loans, capital activity and intercompany balances
Resolve exceptions and approve corrections
Quarterly
Produce statements, investor rollforwards and cash forecast
Confirm reserves and authorize distributions
Before a refinance or sale
Reconcile debt, basis support and expected cash movements
Coordinate lender, legal and tax review
Year end
Complete entity books and tax-adjustment schedules
Confirm owner changes and filing responsibilities
Resolve the decision
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