Financial reporting is critical to an owner or asset manager in monitoring the performance of a property.

Accounting Systems - Coldwell Banker Commercial Real Estate Services Inc.'s automated accounting systems provide:

• Customized accounting packages to meet the client's needs
• Timely, accurate and complete accounting reports monthly
• Cash or accrual reports (monthly)
• Punctual collections
• Individual escrow accounts with monthly bank reconciliations
• Automatic funds transfer to insure interest earnings for escrow accounts
• Current gross sales reports (retail only)
• Coldwell Banker Commercial Real Estate Services Inc. uses a team approach in the management of its internal affairs and the management of its fee accounts.

Coldwell Banker Commercial Real Estate Services Inc. has a fully-automated accounting system which is driven primarily by Skyline and MRI Software. Each office is connected by modem through a Novell Network which allows the various offices to transmit data back and forth. Custom programs have been designed to allow the integration of Microsoft Word, Microsoft Excel, WordPerfect and Timberline into the Skyline or MRI system. As a result, we have the capability of generating reports specific to the client's needs. We currently produce custom reports for many of our clients.

Coldwell Banker Commercial Real Estate Services Inc. provides a detailed monthly report package. Each statement is accompanied by a detailed narrative which describes current activity at the property, major budget variances for income and disbursement line items, leasing activity and other relevant operating information.

Receipts and Disbursements - A separate escrow account is maintained for each client. Typically, a savings escrow and checking escrow are established at the onset of each assignment. All collections are directed into a savings escrow; then funds are transferred as necessary into the checking escrow to pay ongoing bills. Each monthly statement is reviewed and audited by the property manager in charge, and cash is tied back to the client's individual bank reconciliations.

Disbursements are approved in a three-step process. When the on-site manager determines a expenditure is necessary, the expenditure is reviewed with the property manager in charge of the account and a purchase order is issued. Then, the invoice for the work is reviewed and approved by the on-site manager prior to its being sent to the central office for processing. The property manager in charge reviews the invoice and compares it to the original purchase order, then approves it for payment. One of the company's principals then signs the check.

Responsibilities and authority are separated at the staff level to eliminate the opportunity for impropriety by any individual.

Rent Schedules and Collections - A current Rent Roll is produced in each monthly financial report.

Delinquency reports are currently generated three times per month. A copy is delivered by the property manager to the on-site manager who is primarily responsible for collections. Rents are due on the fifth day of the month; considered delinquent on the 55th with eviction procedures to begin on the 9th.

Debt Service Payments - Internal procedures have been established to insure the timely payment of debt service, real estate taxes, insurance premiums and monthly utility payments. All regular reoccurring payments are programmed into the operating budget which is used to flag approximate payment amounts. In addition, an automated suspense file is created for each property which requires the manager to take specific action in order to remove the suspense item from the file. Suspense items would include property tax payments, one time insurance premium payments, lease expiration dates, etc.

Coldwell Banker Commercial Real Estate Services Inc. has developed a Standard Operating and Procedures Manual which is used by the manager in charge and the on-site staff as a general guideline of operations. The manual is modified from time to time, to accommodate unique circumstances at each project. The manual sets forth procedures for collections, purchasing and disbursements, tenant relations and administrative procedures.