AppFolio Property Manager: Set Up Reserve Funds & Restricted Accounts

In AppFolio Property Manager, reserve funds and restricted accounts are set up by creating separate bank accounts (or separate GL cash accounts if the money sits in one bank), then mapping those cash accounts to the right fund balance/equity accounts, and finally enforcing clean workflows so reserve money is only used through approved transfers and coded expenses.

 

Key terms (so the setup makes sense)

 

• Reserve funds: money saved for future major repairs (roof, paving). Usually should not mix with operating cash.
• Restricted account: money that can only be used for a specific purpose (special assessment, escrow, litigation).
• Bank account: the real checking/savings at the bank.
• GL cash account: the accounting “bucket” that tracks cash. One bank can be split into multiple GL cash accounts if needed.

 

Best-practice setup (recommended)

 

• Create a separate real-world bank account for Operating and Reserves.
• If there are multiple restrictions, create separate bank accounts (or at minimum separate GL cash accounts) for each restricted purpose.

 

Step-by-step: create reserve and restricted cash accounts

 

• Go to Accounting and find Bank Accounts (wording can vary by role/permissions).
• Add Bank Account for “Reserves” (and each restricted account if separate at the bank).
• Confirm each bank account is tied to the correct property/association and has the correct starting balance and as-of date.
• In the Chart of Accounts, confirm each bank account maps to its own cash GL (example: Cash - Reserves).
• Create/confirm the matching Fund Balance (equity) accounts (example: Fund Balance - Reserves, Fund Balance - Special Assessment).

 

How to keep reserve money “restricted” in real life

 

• When dues come in, post reserve portions to the Reserve cash (or transfer from Operating to Reserves on a schedule).
• Use bank transfers between Operating and Reserves for board-approved moves. Do not “journal” cash without a real transfer unless your accountant requires it.
• Code reserve expenses to reserve-appropriate expense accounts and pay them from the Reserve bank when possible.

 

Common mistakes to avoid

 

• Mixing operating and reserves in one cash account with no tracking: reports become unreliable.
• Posting reserve contributions as income instead of equity/fund balance movement (depends on your accounting basis). If unsure, confirm with CPA.
• Reconciling the wrong bank account: always match the statement to the exact AppFolio bank.

 

Test and validate (so you know it’s correct)

 

• Run a Balance Sheet: reserve cash should appear separately and tie to the reserve bank statement.
• Run a General Ledger for the reserve cash account: verify only reserve-related deposits, transfers, and payments appear.
• Reconcile each bank account monthly in Bank Reconciliation.

 

Troubleshooting and when to contact support

 

• If reserve cash in AppFolio does not match the bank: check as-of dates, duplicate deposits, and whether payments were made from the wrong bank.
• If you cannot add/edit bank accounts: it is usually a permission issue.
• Contact AppFolio support (or a CPA) if you need to split one real bank into multiple GL cash accounts, convert accounting basis, or correct historical postings without breaking reconciliations.