It takes a deeper appreciation for accounting to realize that it is indeed the language of business. After all, knowing what’s going on inside the business can only be possible if business leaders can gather and understand their company’s past, current and prospective financial health.
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In this second of our two-part series featuring Mark Kappelman, founder of Real Estate Accounting (REA), the CPA and CFA Charterholder discusses how real estate investors can be more accountable by getting their real estate accounting right. If you know your numbers well, then you’re ahead of the game.
Key Points From This Episode:
- Who handles the outsourcing work in their company?
- How does his firm manage its diverse range of clients?
- How does he ensure accountability in his business?
- How do they collaborate as an outsourced services firm with in-house accountants?
- What are the characteristics of their most successful clients?
- Who is his ideal client?
- What makes his accounting services different from others?
- How does he help his clients to get educated in accounting?
- Why should investors care about accounting?
- What are some of the most important metrics that he tracks?
- What are the habits that have made the most returns for him?
- What is the main thing that has contributed to his success?
- How does he like to give back to the community?
“It’s a very different deliverable. We’ve chosen to just focus on this owner/operator thing because it’s what I know. And then that’s what we look for when we’re hiring our in-house controllers and our account managers.”
“The more applications, the more diversified our client base is. And in the process, I think we’ve built a pretty strong business.”
“You don’t have to review every single thing they do, but spot-check things randomly, almost like an audit.”
“You should care about your accounting because it has a massive impact on your gain on the sale.”
“I think when you actually get close to your numbers, you can then start making decisions to change those numbers.”
“Accounting is the language of business. And I think you start to see that as you move up in the company.”
“When you start going into those management meetings, it’s kind of clear because then you start looking at P&L and balance sheets.”
“I don’t care if you’re the head of HR, or the head of product, or finance or marketing, or whatever it is, people are gonna hold you accountable, do a P&L. If you have no idea what that is or a balance sheet, then you’re at a disadvantage.”
About Mark Kappelman
Mark Kappelman is the founder of the real estate accounting firm Real Estate Accounting (REA) which provides complete back-office solutions for third-party property managers (residential and commercial), owner-operators, syndicators, and developers. Prior to this, he was an accounting professional at Ernst & Young and PricewaterhouseCoopers.
Mark earned a bachelor’s and a master’s degree in accountancy from the W.P. Carey School of Business at Arizona State University. He is also a CPA and a CFA Charterholder.
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