At the highest level, a Cash Management Rule tells coManage which bank account to send funds to and which bank account to pay funds from for each property. It is based on the relationship between non-Cash GL Accounts, Cash GL Accounts and Financial Accounts (Bank Accounts).

Quick Primer on Prerequisites

GL Accounts

General Ledger ("GL") Accounts can be different types: Cash or non-Cash (Asset, Liability, Capital, Income or Expense). These affect your financial accounting and reporting. You select a GL Account when you create a receivable charge/credit or a payable invoice. The most commonly used non-Cash GL Accounts are "Rent" (type: Income) and "Repairs & Maintenance" (type: Expense) or "Security Deposit" (type: Liability). Every property manager has at least one Cash GL Account. GL Accounts also have user-defined numbers to simplify entry.

Every GL Account that is not type: Cash has to be offset by a Cash GL Account when receiving money or sending money. This offset is defined in the Cash Management Rule.

Financial Accounts (Bank Accounts)

For now, in coManage, only Cash GL Accounts linked to Financial Accounts can be set as a default cash account on a Cash Management Rule. Otherwise incoming and outgoing ACHs and check payments would not have a bank account to utilize.

You associate a Financial Account with a Cash GL Account on the GL Account edit page.

You add and edit Financial Accounts here.

Be sure that the Financial Account is set as an Escrow Account.

Cash Management Rule

To create a Cash Management Rule, navigate to Organization Settings > Cash Management Rules and click "Create New Cash Management Rule."

In this example, called "Sample CMR 1", the default Cash GL Account for all payments and receipts is "1110: Operating Cash 1". And "1110: Operating Cash 1" is associated with the Financial Account, "HSBC 80". This means invoice payments will come out of and rent payments will go into HSBC 80.

Sample CMR 1 has a single exception mapped out for the Liability GL Account "2250: Tenant Deposits." It defines the exception default offset Cash GL Account as "1120: Escrow Cash", which is also associated with bank account "HSBC 80." As such, any bill payments or tenant receipts for GL Account "2250: Tenant Deposits" will also come out of or go to HSBC 80; however, they will be tracked under Cash GL Account "1120: Escrow Cash" and not "1110: Operating Cash 1".

You can have any number of exceptions and the associated Cash GL Accounts can be associated with any Financial Account. For example, some managers have 4+ Financial Accounts per Property. Here is where you can map out how those are handled.

Each property in the system can have one and only one Cash Management Rule. You set a Cash Management Rule on a Property via the Property page. To do so, navigate to any given Property and click Edit.

Now, whenever you create a payable Invoice or receivable Charge/Credit for this Property, the Cash GL Account will be set automatically based on the Cash Management Rules mapping of GL Account offsets.

Here's a payable Invoice:

Because the GL Account "6260: Landscaping" was selected and it has no exception to the Default Cash Account "1110: Operating Cash 1", the Default Cash Account is set.

Here's a receivable Charge/Credit via a Receipt:

Because the GL Accounts "2210: Prepayment" and "4500: Rent" are outstanding and neither have an exception to the Default Cash Account "1110: Operating Cash 1", the Default Cash Account is set.

This then affects Bank Deposit generation for Manual Receipts. And it affects where cash goes for Portal Receipts.

If you have any questions or have an idea for how we can improve this, let us know!

Did this answer your question?