The Importance of Cash Flow Management

Keith Arnell from Pavilion Advisors Explains the Importance of Cash Flow Management in Real Estate

Keith Arnell is the founder of Pavilion Advisors, which provides virtual accounting services for companies. Mr. Arnell is a trusted finance and accounting professional with experience working directly with company executives and management teams. Mr. Arnell is experienced in startups, real estate groups, real estate investment funds, fund accounting, and private equity experience. Committed to best practices and processes through technology and workflow systems.


Pavilion Advisors provides accounting services from small companies to mature companies that have been operating for many years. We have a range of services and pricing to help all types of real estate companies. Smaller companies that are early stage or a couple of years old, we provide financial clean-up of their financial statements and provide best practices and processes of financial reporting and metrics. Real estate investment funds need specific services for fund accounting such as month-end fund closing, NAV calculations, redemption queues, and distributions and waterfall calculations. Providing timely and accurate financials for investment funds are critical for performance reports to investors on a monthly or quarterly basis. Real estate hard money lenders need month-end closing procedures to ensure that their promissory note receivables are being calculated accurately and invoices are being sent timely to receive payment from borrowers. If investors are involved, the income needs to be allocated accurately to investors and owners of the company. Property management companies have niche ratios that need to be measured and tracked each month. Specific KPI’s such as occupancy rate, cost per unit, average rent, cap rate and average arrears among others should be monitored each month.


How does a company manage cash flow? As companies grow there are usually growing pains and cash flow is usually at the forefront. A lot of businesses create budgets each year to help with cash flow issues. A budget-to-actual analysis is the best way to understand how the business is doing each month based on the budget. Analyzing the budget-to-actual to determine where the biggest variances are and then determining why there is a variance will provide actionable solutions to get the variances back within the budget. If a business uses a budget but does not monitor or review it and make adjustments on a regular basis, it is like paying for a gym membership but not using the equipment or working out in the gym. Monitoring and making adjustments is critical in using a budget. A 13 week cash flow management worksheet provides short-term cash flow projections for companies. This projects cash flow on a short-term basis (13 weeks) to alert the business with any cash shortfalls within that 13 week timeframe to take early action on finding a solution to the cash flow problem. The opposite occurs as well if a company has a lot of cash on hand that is not needed on a short-term basis. The company can look at other investments or short-term higher interest bearing accounts that the company can make more money then holding in a bank account.


As a virtual controller, Mr. Arnell has worked with many real estate companies and other industry companies. Mr. Arnell can help companies transition from startups to more established companies and anything in between. Providing sound financial accounting and reporting for companies is the best way to help them gain financial insights into their business. Depending on the size of your company and what your company is needing, Mr. Arnell can provide all monthly accounting or specific controller level roles such as the month-end close, cash flow management, etc.


One size does not fit all. Even though there may be some similarities between two or three companies, most companies are unique and have unique accounting needs. Pavilion Advisors addresses this by understanding each company’s business model, what drives revenue and tailor reporting and metrics for each company that they work with.

Contact Keith Arnell with Pavilion Advisors for your real estate accounting!
Email: ​
Phone: (801) 336-6580

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