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If your block is an existing one, Gordon & Co will carefully draw up a realistic budget for the beginning of each financial year using historical information and any new items that may need to be included for the forthcoming year. The budget will be forwarded to the client if requested to be discussed and amended as necessary. When agreed, it will be formally drawn up and sent to each lessee showing all items and how their service charge proportion has been calculated.
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The budget will generally consist of items such as;
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If it is a new block, after a site meeting with the freeholder or directors, Gordon & Co will assess the services needed to keep the property well maintained and up the desired standard, and coupled with any other information gleaned from the client, we will draw up a first budget for approval. When agreed, the budget will be sent to all lessees showing the breakdown and their yearly service charge proportion. If the property has been bought during the designated financial year, the costs will be pro-rata for that year. We will monitor the costs and accuracy of the budget then realistically amend for year two and onwards if necessary.
If you are a developer, please see the section on Developers and builders
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 | Following on from the agreement of the budget above, the service charge demands will be calculated by the accounts department as per the terms of one’s lease, and then demanded two weeks before the due date. Service charges are normally paid either quarterly or half yearly.
All monies for each client are held in separate client accounts, and then can be sub divided if necessary into further accounts for certain reasons such as major works, minor works, ground rent etc. All money collected for certain projects is therefore ring fenced from everyday service charge monies, and all accounts get individual statements and interest accrued accordingly at the current rates.
The money collected in the service charge account is used for the everyday expenditure of running the property, which is why prompt payment is always required . If invoices are not settled promptly, a reminder is sent out, and if funds are still not forthcoming, a second reminder is issued. Lessees are reminded that late payment can attract interest under the terms of the lease, and if funds are still not paid, an adminisration charge is levied on their account, and following consultation with the client, legal action may be used to recover the amount owing. | |
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Credit control is extremely important and effective property management is dependent on it. Only approved contractors with the correct method and risk statements will be awarded work , and we will endeavour to pay the contractors within their prescribed timeframes ( unless the invoice has been queried). The contractor will have to represent ‘value’ and if the relationships stay friendly but professional, then contractors are more likely to go the extra mile to help out in emergencies.
The expenditure is regularly checked against the budget and any large discrepancies will be flagged up as soon as possible and discussed with the client. |  | |
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 | Gordon and Co use a modern specific block management software package called ECS Qube. Statements of charges are quickly and easily accessed and analysed if there is a query on a certain client’s account, or the house account. We keep detailed records of all transactions relating to the clients property, and having these recorded on our computerised system enables us to deal with the accounting queries quickly and efficiently. Freeholders, RTMs , Management companies and individual clients can be sent quarterly house statements if requested , and we can discuss any bespoke needs they you may require.
At the end of the financial year the accounts are prepared for the accountant and the year end surplus or deficit is calculated and levied in the accounts for the next financial year. | |
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The ground rent is effectively a rental charge payable to the freeholder by the leaseholder for having their flat or dwelling on the freeholder’s land. This is generally not a substantial sum and this amount stated in the lease.
Gordon and Co will act on behalf of the freeholder and collect the appropriate ground rent and forward it on to them, or indeed have a separate account to hold such monies for them. There will be increases in ground rent payable stipulated in the lease, which will take effect at various intervals; normally every ten years.
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 The accounts department will keep all of our client’s monies safe in their designated client accounts. We are members of ARMA and FSA and adhere to their strict guidelines and codes of practice on financial control. This keeps the clients happy in the knowledge that their interests are being tightly monitored, assessed and managed.
Regular statements of any accounts can be sent out to clients when requested or as part of our agreement.
If you require any more information of these two bodies please follow the links
http://www.arma.org.uk http://www.fsa.gov.uk |
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