Management Fee Adjustment

Step-by-step: Processing a management fee adjustment or refund (correct method)

Step 1) Check the property’s management fee setup

1. Open the property record / setup page.

2. Locate:

   • Fee type (fixed fee or %)

   • Amount (or rate)

   • Account code used in the setup (this is the key control point)

What you’re looking for: the account code the system uses to calculate and enforce the fee.

Step 2) Confirm the purpose of the entry

Decide which situation applies:

• Missed fee for a prior period (you need to bill it now, but don’t want to disturb this month’s calc)

• Adjustment (increase/decrease due to agreement, correction, goodwill, etc.)

• Refund (returning all/part of a previously charged fee)

Rule of thumb: If it’s not the normal fee the system should calculate for the current month, treat it as an adjustment.

Step 3) Create the manual agent invoice (or credit) entry

1. Go to Manual Agent Invoice (or equivalent screen).

2. Select the relevant:

   • Property

   • Period/date

   • Supplier/agent (if required by your system)

3. Enter the amount (+ for charge, – or credit note for refund).

Step 4) Select the Management Fee Adjustment account code (critical step)

1. In the account code field, do not select the same account code used in the property’s management fee setup.

2. Instead select the Management Fee Adjustment code (example: #5806 – Fees: Management Adjustments).

Why this works: the adjustment code posts the difference as a standalone transaction, so the system does not treat it as something that should be “corrected” by the monthly fee calculation.

Step 5) Add a clear description / narration

Use a description that makes audits and queries easy, for example:

• “Mgmt fee adjustment – missed fee for Oct 2025 (charged Feb 2026)”

• “Mgmt fee refund – goodwill adjustment per client approval”

• “Mgmt fee correction – prior period rounding difference”

Step 6) Validate the outcome before posting (quick check)

Before you post/save/approve (depending on workflow), verify:

• The transaction is coded to Management Fee Adjustments (not the setup code).

• The current month’s management fee calculation figure remains unchanged.

• The entry is showing as an additional adjustment/refund, not replacing the month’s fee.

Step 7) Post/approve and keep evidence

1. Post/approve the invoice/credit.

2. Attach supporting documents if your process requires it (email approval, calculation, agreement clause, etc.)

What NOT to do (and what happens if you do)

Don’t post manual entries to the property’s management fee setup code

If you select the same account code as the property’s fee setup when raising a manual invoice, the system will often:

• Recalculate the fee, and

• Raise an automatic invoice or credit to bring the month back in line with the property setup.

This is what causes confusing “why did the system undo my manual entry?” outcomes.

Examples (mapped to your scenarios)

Example 1: Missed period fee

• Property fee setup account code: #5804 (VO expense)

• You need to charge for a missed period in the current period

• Correct action:

  • Raise manual agent invoice

  • Code it to #5806 (Fees – Management Adjustments)

Result: You capture the missed fee without interfering with the current month’s normal calculation.

Example 2: Fixed fee property and a partial manual entry

• Fixed management fee: $1,000/month

• Property setup account code: 6671

• If you enter a manual invoice for $500 against 6671:

  • The system will treat the month as needing to total $1,000

  • It may reduce the calculated fee to $500, then generate further transactions so the month ends up aligned to the setup

Correct approach: Post the $500 as an adjustment using the Management Fee Adjustment code, so the system still calculates $1,000 for the month and your $500 is treated as a separate adjustment/refund item (depending on intent).