Are you ready to take advantage of REI Hub's property accounting software but aren't sure what's involved in making the switch from your current bookkeeping system? You're in the right place!
When transitioning accounting systems, the best practice is to choose a date to make the switch and then transition balances from the old system to the new one. This is faster, easier, and more practical than attempting to move over the entirety of your transaction-by-transaction records. You can export or save the general ledger from your previous system to reference individual transaction records.
To Transition to REI Hub From Another Accounting System
1) Set up your REI Hub Portfolio
You have probably already started with this! Before you move any records over, make sure your REI Hub Portfolio is set up to receive that information. This means creating in REI Hub all the properties, units, and various accounts (banking, loan, fixed asset, etc.) that already exist in your current accounting system.
Please note that banking, loan, and fixed-asset accounts should be created from their respective pages on the left-hand menu under Accounts.
Check out our REI Hub Overview and Getting Started Guide for more information and instructions!
You'll also want to check your current Chart of Accounts and Update the Chart of Accounts in REI Hub if needed.
2) Choose your Bookkeeping Transition Date
Choosing a Bookkeeping Transition Date is essential to transitioning from one accounting system to another. It clearly demarcates where your transaction-by-transaction records are and which set of records should be considered definitive for a given time period.
You can choose any date as your Bookkeeping Transition Date. The most commonly chosen date is January 1, as operational revenue and expenses are reported on a calendar year basis. Since they reset on January 1, a balance will not be set.
If you choose a date other than January 1, you will need to set Opening Balances for your standard Revenue and Expense Accounts in addition to Asset, Liability, and Equity Accounts. Otherwise, you must reference information from both systems when preparing your tax return.
3) Determine the closing balances of your previous system
If your REI Hub Bookkeeping Start Date is January 1, then your bookkeeping close date in your old system is December 31. Pull the balance sheet or closing balances in your old system for the bookkeeping close date. How to do this will vary based on your current system.
How many account balances you will transition over depends on your portfolio size and how you have your books structured in your old system. Here are some key accounts to make sure to include:
Banking accounts dedicated to the portfolio or business
Loans associated with specific properties or the overall portfolio
Fixed Asset accounts for each property including basis information: Buildings (depreciable), Land (non-depreciable), and Accumulated Depreciation
4) Set Opening Balances in REI Hub
You should have set your REI Hub Bookkeeping Start Date during portfolio setup. If not, confirm or set it under Portfolio Settings in the right side menu.
Take the closing balances from your old system and enter them as Opening Balances in REI Hub. You should have an account available in REI Hub for all of your balances.
5) Keep your books in REI Hub
All transactions after the Bookkeeping Transition Date should be booked in REI Hub. Since you have correctly set your opening balances, your records should be accurate moving forward!
Export any records desired from your old system before you close or lose access.
The hardest part of transitioning systems is the setup. If you have any questions along the way, call or email our support team for guidance on how to get started in REI Hub!
Still have questions? Reach out to our Support Team via email at [email protected] or call us at (888)939-6865.