Most District Managers have over 10 years experience in managing on-site personnel. In order to maintain control without hampering the ability of our on-site staff to do their job in a timely manner, we have developed the following cost control program:

1.
Site employees are required to contact their District Manager (DM) for prior approval for any purchase(s) that exceeds the approved budget for that sub-account. Some capital expenditures require approval regardless of the budgeted amount.  All sites must use the Bernard/Allison purchasing book for buying assistance (see #4 below).   Prior to payment of any invoice, the Resident Manager (RM) checks each invoice to ensure that:
  • All items were received
  • Items are in good condition
  • Invoice is complete
  • Quantities are correct
  • Unit price is correct
  • Total/extension is correct and that
  • Discount terms have been applied

The RM then signs the vendor invoice and enters it into the Accounts Payable system. Each DM reviews each session of payables and signs the session header indicating approval.

2.
 The DMs review the monthly cash operating report for each item purchased.  They compare costs, including year-to-date total cost, with standards set by our experience and what common sense dictates.  For instance, we know that a 2 Bedroom apartment requires about 3 ½ gallons of paint (excluding ceilings) if all walls are painted with a low sheen, semi-gloss, latex, enamel paint.  They refer to the move-out summary and compare the total dollars expended on a site for paint vs. number of move-outs.   In addition, they compare paint cost per rental.   These types of investigative procedures help us determine whether we are over-painting or under-painting. Due to differences between sites, the DM's experience is invaluable when interpreting the meaning of these types of comparisons.
3.
 DMs compare budget vs. actual expenses incurred each month and on a year-to-date basis, and prepare a monthly variance analysis for the owner.
4.
 The Purchasing Director negotiates prices for most repeat/standard items purchased by each site, following established Competitive Bid Procedures.  These procedures ensure uniformity and cost effectiveness in all areas of procurement. Once prices, terms, volume discounts, etc. have been negotiated, the successful vendor is listed in the Bernard/Allison Purchasing Book.  This book is used by all sites to ensure all purchases are made from vendors whose materials or services have been approved as most competitive in price and service.