Financial Analysis and Reporting Flashcards
7 cards from real CAM practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Financial Analysis and Reporting flashcards as text
An owner wants to compare their property's financial performance to similar properties in the market. Which benchmarking tool is most commonly used?
Answer: National Apartment Association (NAA) survey data or IREM income/expense analysis
Industry surveys from NAA and IREM provide expense-per-unit and income benchmarks by property type and region.
Which of the following situations would cause an UNFAVORABLE variance in the maintenance expense category?
Answer: An emergency roof repair costing $15,000 was not budgeted
An unbudgeted emergency repair increases actual spending above the budgeted amount, creating an unfavorable variance.
A property manager is preparing a 12-month cash flow forecast. Which item should be excluded from the operating cash flow section?
Answer: Loan principal repayment
Loan principal repayment is a financing activity, not an operating expense, and falls below the NOI line.
The Internal Rate of Return (IRR) is used in apartment investment analysis primarily to:
Answer: Measure the annualized return that makes the net present value of all cash flows equal to zero
IRR identifies the discount rate at which the present value of future cash flows equals the initial investment, expressing return as an annualized percentage.
Which financial report would a manager review to determine the current outstanding balance of a resident's rent account?
Answer: Accounts receivable aging report
The accounts receivable aging report lists outstanding balances by resident and shows how long each balance has been owed.
When reviewing a prior month's financial statement, a manager finds that insurance expense is $0 for the month but the annual premium has been paid. This is MOST likely because:
Answer: The annual premium was prepaid and recorded as a prepaid asset, with monthly amortization being absent or deferred
Prepaid insurance is an asset that should be amortized monthly; a $0 monthly expense suggests the entry was not yet made.
A property manager is asked to present a 'T-12' report to a prospective buyer. This document contains:
Answer: Actual income and expense data for the trailing 12 months
A T-12 (trailing 12 months) report shows actual operating results for the most recent 12-month period, used in due diligence.