---
title: "Accrued expenses, utilities, and occupancy"
sidebarTitle: "Accrued expenses"
description: "Reviewing accrued expenses and the client's GL adjustment entries, utilities, property tax, percentage rent, and the quarterly sponsor and director fees."
icon: "file-invoice"
---

> **For AI agents:** the complete documentation index is at [llms.txt](/llms.txt). Append `.md` to any page URL for its markdown version.

The client-driven accrual schedules, plus the occupancy accounts and the quarterly fee that most often needs a conversation.

<Info>
  **Source:** `Rackson_RRS_RCY_Review_Process.docx` sections 19, 20, 41, and 27.7.
</Info>

## Accrued expenses (GL 24000)

Primarily **client-driven**. The recurring item each period is the **management fee / common equity management fee**; other one-off items are added to the schedule as the client identifies them.

### Caitlin's GL adjustment entries

Near period-end, Caitlin sends a set of **"GL adjustment" entries** — items that need to be reclassed or reversed.

<Warning>
  **Most of these are designed to reverse automatically the following period; a smaller number are intended to remain on the books.** Confirm which category an item falls into before assuming it will clear itself.
</Warning>

<Note>
  **Keep the schedule current with a running description of each item**, so recurring items (like the management fee) don't need to be re-explained each period, and so a new preparer can see at a glance why each balance exists.
</Note>

<Frame caption="Accrued expenses schedule, showing the client's period-end GL adjustment entries">
  <img src="/images/customers/rackson/review-process/image7.jpg" alt="Rackson accrued expenses schedule with client GL adjustment entries" />
</Frame>

### Step-by-step checklist

<Steps>
  <Step title="Confirm the recurring management fee accrual is recorded">
    For the period.
  </Step>
  <Step title="Review Caitlin's GL adjustment entries">
    Confirm which are set to auto-reverse next period and which are intended to remain.
  </Step>
  <Step title="Update the running description">
    For any new item added this period.
  </Step>
  <Step title="Tie the ending accrued balance to the GL">
  </Step>
</Steps>

<Warning>
  **These adjustments frequently land late in the close**, after the in-house maintenance allocation and closed-store reclass have already run. See [In-house maintenance](/internal/customers/rackson/review-process/in-house-maintenance) and [Closed store reclass](/internal/customers/rackson/review-process/closed-store-reclass) — both may need re-running.
</Warning>

## Utilities

**Approvals and underlying detail are entirely client-driven.** PBI maintains a schedule based on what the client reports and reconciles that schedule to the GL, rather than sourcing utility data independently in the normal course.

<Warning>
  **Utilities are one of the hardest categories to independently verify** on this engagement, even relative to other PBI clients of similar size:

  - Billing periods **frequently don't align to a calendar month**.
  - Several providers **will not grant PBI direct online access** to accounts, even where online access exists for other utility types.
</Warning>

Where PBI does have access, statements are pulled directly. Where it does not, the client (**Mike**, and increasingly **Erica** on the client side) sends **statement screenshots**, which PBI uses to identify and code the correct period and amount.

<Note>
  **Practical approach:** rely on client-provided detail for the underlying numbers, and focus PBI's own review effort on **flagging anything that looks unusual on the P&L** rather than trying to independently rebuild the utility schedule from source documents each period.
</Note>

### Step-by-step checklist

<Steps>
  <Step title="Collect the client-approved figures">
    From Mike or Erica.
  </Step>
  <Step title="Update the schedule and tie it to the GL">
  </Step>
  <Step title="Pull statements where PBI has access">
    Otherwise rely on statement screenshots provided by the client.
  </Step>
  <Step title="Flag anything unusual on the P&L">
    For follow-up, rather than attempting a full independent rebuild.
  </Step>
</Steps>

<Note>
  The RCY approach is the same: client-approved figures maintained on a schedule and tied to the GL, with Mike sending his own tracker and supporting detail coming from statement screenshots.
</Note>

On the close checklist, the **Utilities Accrual** is a **WD –2** task and the **Utility Accrual JE** lands on **WD1**.

## Property tax (GL 24200)

Reviewed the same way as the other landlord/lease-driven accruals: **confirm the schedule against what's actually hit the GL**, and chase down anything that can't be traced back to a support item.

On the close checklist, **CAM / Real Estate** is a **WD –1** task.

## Percentage rent (GL 24500)

<Note>
  **Two schedules, one per concept** — RRS and RCY each have their own "2026 % Rent Schedule" file, consistent with the two concepts otherwise running parallel workbooks.
</Note>

**Whose schedule governs:** Caitlin maintains this on the client side and sends it over **with adjustments already identified**. PBI's role is to **book what she sends and reconcile it to the GL**, not to build the percentage-rent calculation independently.

<Warning>
  There have been instances where **PBI's own tracking was off from Caitlin's** and required a follow-up with Mike to sort out and correct. **Don't assume the schedule is self-evidently right just because it ties to itself period over period.**
</Warning>

## Sponsor fee and director's fee

### How it appears in Intacct

The journal entry is named **"Adjust CCV Mgmt Fee Accrual to Actual"** — "CCV" is the shorthand used for this management/sponsorship fee arrangement in the JE description. **Use that term when searching journal history for this entry.**

### Billing cadence

Both the sponsor fee and the director's fees are billed out **quarterly, on the same cycle**.

### This is the item most likely to need a conversation

<Warning>
  Normally the amount is consistent quarter to quarter and can be accrued without much discussion. **When the amount changes and PBI doesn't have a clear reason why, that's the trigger to raise it with the client** — rather than just advancing the new number forward as if it were confirmed to be the new run rate.
</Warning>

<Warning>
  **Confirmed activity this year.** A separate JE — **"Credit back adjustment to Q1 & Q2 sponsor fees"** — shows this fee was actually **reversed/credited back for two quarters** during this fiscal year. **Confirm the current-year run rate against the client directly** rather than assuming Q1/Q2 activity is representative of the full year.
</Warning>

- **Support** should be requested and attached for any change **before it's booked**. If support can't be located, follow up directly rather than guessing at the reason for the change.
- **Reversals:** any prior-period invoices that end up reversed get **added back into this schedule** rather than handled as a one-off adjustment elsewhere.

<Warning>
  **Open item.** At the time of the review, the team was roughly **a period behind** on getting one of these adjustments fully discussed and resolved with the client. Confirm current status. Tracked on [Open items](/internal/customers/rackson/open-items).
</Warning>

## Related

- [RRS utilities and interest workpapers](/internal/customers/rackson/workpapers/rrs-utilities-and-interest) — the 24000 Blue Note sponsor fee and 24100 accrued utilities preparer steps
- [RRS inventory and prepaids workpapers](/internal/customers/rackson/workpapers/rrs-inventory-and-prepaids) — the 14100/24200 property tax schedule
- [RCY GL adjustments workpapers](/internal/customers/rackson/workpapers/rcy-gl-adjustments) — the GL Adjustment Workbook and its Recon gate