Cash Collections for 3rd Party Seller

1

We have a special situation not sure the best way to account for it in Manager.
I going to try to keep this simple. We have a 3rd party company managing the construction and selling our condo units. In some instances the buyer makes payments directly this 3rd party company. Since we are the actual sellers, we need to record the payment by the buyer so their statement is relected property, but don’t receive any cash.
Now I need to invoice the 3rd party company for the money they received on out behalf.
Lastly, when they remit the cash received, they will have deductions for commissions, and cost to for construction that they may pay on our behalf.
Not sure the best way to handle this in Manager. Any suggestion would be appreciated.
Thanks,
Dan

2

What you have asked is very broad and actually has little to do with Manager. The accounting depends on contractual relationships between all the parties as well as how they assert and discharge obligations and who is legally responsible for what at various stages in the process. This will all be complicated by the involvement of titled real property. It is not just a matter of what form is used or which accounts are debited or credited. You should obtain qualified legal and accounting advice, then ask how to implement their instructions, if necessary.

3

I appreciate your response and I understand what your saying. For now, I trying to figure out the best way to handle this in Manager so the Developer comapny can capture the payment and then invoice the 3rd Party company for the funds they received.

4

I suggest you

  • Create a test business

  • Add some accounts that make sense to you

  • Add some test customers (actual and possibly agents)

  • Add some test supplier

  • Experiment adding a few invoices and receipts / payments

Then

  • Look at the resultant summary page profit & loss as well as balance sheet accounts

  • Look at the reports on Manager

Do they show what you want to see. If not ask a specific question to your accountant or perhaps in the forum depending on the nature of the question.

5

In my experience, all buisness models similar to yours where a 3rd party manager acts as an intermediary. The manager handles sending statements to customers and sends the agents their money less their fee as well as a monthly report that they can enter as a single entry at month end.

Doing double the admin work defeats the purpose of having a manager in the first place.

6

I guess the simplest thing would be, not allow the buyer to make payments to the 3rd party.
If the 3rd party requires funds, then the buyer pays you and you forward the funds to the 3rd party, then the 3rd party doesn’t have to refund buyers monies to you which weren’t theirs to receive.

This way, you keep the sales invoices to the buyers and the purchase invoices from the 3rd party completely separate, untainted.