I Double-Dog Dare Him

Last week I sent Mr. Partner the first quarter books and a long note with what is going on. Essentially we had vacancies--which happens when you have a gazillion rentals. We had potties back up. We had a this. And a that.

The books for the first quarter show a sizable profit. Simply put, the property management company collected the rent for the month, holds it, and because of the way the banking system involve works, the rents hit my bank account the beginning of the next month. So, rents look a month behind.

However in March, Kirby had his A game on and March's rents showed up in my bank account on March 30 instead of April 1. Therefore, on the financial statement, it showed December's, January's, February's and March's rent. Essentially it looked like we have lots of extra money. If you take the rents over any random six month period, it will even out. It always does.

I explained this to Mr. Partner. The financial statement he was looking at was a snapshot in time. That's all. It isn't a reflection of the bank account, as most of that money is taken out for mortgages (which aren't paid until April 4th or so).

Mr. Partner in turn didn't fully grasp this. He never does. We have had this conversation many times before. In my report to Mr. Partner, I pointed out we (Marty and I) had footed the bill for some repairs at one of our vacancies. We also have home owner's insurance due this month. When could we expect his contribution? This is also nothing new. We have home owner's insurance due every July.

In fact, the scenario outlined above is nothing new for the past several years. The way we operate, we pay home owner's insurance out of pocket. We always have. Also, because of several vacancies we didn't have the cash in the bank account to cover the repairs at one of our homes and the home owner's insurance. This happens too. Welcome to owning a gazillion properties that were purchased when the market was fabulous and before unemployment was 18 percent in Birmingham.

What Mr. Partner did do was ignore me and write directly to Marty Sunshine. He told Marty he didn't want to "upset" me. My real guess is he didn't want me to go into serious bitch-mode when he said what he wanted to say. Sadly for Marty, I did--but only at Marty. I am biting my tongue with Mr. Partner.

Mr. Partner has decided to "audit" us. He is going to bring in his own team of experts--ones who hopefully can read competently financial statements. Mind you, Diamond Jim--a licensed CPA--has to put his stamp of approval on everything sent to the IRS. But, whatever. Apparently Mr. Partner feels money is somehow being funneled somewhere and it isn't the company.

It is obvious isn't it by our extravagant lifestyle and wild European vacations? My trips to Birmingham to check things out, talk to lawyers and inspect homes are generally on Marty's and my dime. We live as modestly as we can, knowing that every July we have home owner's insurance due and every December we have property taxes due.

I welcome Mr. Partner's audit. In fact, I will be happy to tell him the above and more when he gets hold of the books. And, if he finds more money it will be reimbursed to me first.