Managing agent handovers: a finance checklist for taking on a new block or portfolio without gaps
Taking on a new block (or a whole portfolio) often starts with a simple instruction: “You’re live from Monday.” But the finance side rarely switches that cleanly. Payments keep going out, arrears keep building, and suppliers keep invoicing whether you’ve got the paperwork or not.
If you want a handover that doesn’t unravel in month 2, you need a structured finance checklist that covers control, clarity, and continuity. The goal is simple: you can explain where every £ is, what it’s for, and what happens next.
If you’re inheriting service charges, start by getting your foundations right with service charge accounting.
1) Before you agree the takeover date: lock down the basics
The fastest way to create gaps is to accept responsibility before you’ve got control of the money and records. Before you confirm the “go-live” date, make sure you can get:
- Bank account details for each client (service charge, reserve/sinking fund, client deposit, or separate trust-style accounts where applicable)
- Authority to operate / mandate info (who the signatories are, and how access is being transferred)
- Accounting system access (or a full export if you’re moving systems)
- The last 12 months of bank statements (minimum — 24 months if there’s been major works, disputes, or messy arrears)
- A current reconciliation pack (bank rec, debtor balances, creditor balances, reserve fund schedule)
If you’re already thinking “this is going to be spreadsheet-heavy,” consider setting up proper routines early through bookkeeping or moving straight to Xero bookkeeping so you’re not trying to manage a live handover with half-complete records.
2) Day 1 non-negotiables: get control of cash and commitments
On day 1, your job is to stop money drifting and stop responsibility becoming blurred.
Cash control checklist
- Confirm actual cleared balances (not just what the previous agent says is there)
- Identify any unpresented cheques / uncleared items and what they relate to
- Make sure service charge funds aren’t mixed with management company costs
- Confirm where reserve/sinking funds are held, and whether there are restrictions on use
- Check whether interest is retained within the fund or credited elsewhere (this needs to match the lease/agreements)
If you want a simple, repeatable approach, the month-end discipline you use in Xero matters. A strong reconciliation routine (and rules that prevent miscoding) is exactly what’s covered in Xero bank reconciliation.
Commitments checklist
- Get a list of recurring contracts (cleaning, lift, fire systems, grounds, utilities, managing agent fees)
- Identify any planned works already approved or in progress
- Confirm retentions being held and the release conditions
- Request a schedule of known disputes and credit notes (they almost always affect the numbers)
If you’re taking on blocks where coding and postings have been inconsistent, it’s worth scanning for common problems early — this article on common service charge mistakes will feel uncomfortably familiar for most handovers.
3) Set a hard cut-off date, then manage the crossover properly
Handover periods create the classic mess: invoices arrive after you’ve taken over, but relate to the previous agent’s period (or vice versa). If you don’t structure the crossover, you’ll spend months explaining charges that don’t look “fair”, even when they’re correct.
Do this immediately:
- Agree a handover cut-off date in writing (for accounting responsibility and approvals)
- Create a “handover costs” holding category for anything that needs allocation/confirmation
- Separate costs into:
- Pre-handover period (approved/committed before you took over)
- Post-handover period (new approvals under your control)
- Keep a short handover log: date received, supplier, amount, what it relates to, approval status
If you’re managing residential blocks, your structure should match how service charge accounts are expected to be presented and supported. That’s where residential property management accounting helps keep things consistent (especially across multiple sites).
4) Build a “first 30 days” pack you can stand behind
Your first month isn’t about perfection — it’s about producing a position you can explain confidently.
Your first 30-day finance pack should include:
- A bank reconciliation you trust
- A service charge fund summary (held, committed, available)
- A reserve/sinking fund movement schedule
- An aged arrears list with next actions
- An aged creditor list with payment plan and approval status
- A short variance view vs budget (even if it’s a baseline)
- A “red flags” section (missing invoices, uncertain balances, unresolved disputes)
If you’ve taken on a large portfolio and you need this type of pack across multiple buildings quickly, it may be more efficient to operate like a mini finance function from day 1. That’s exactly what outsourced finance department support is designed for.
5) Don’t let compliance deadlines slip during the handover
Handovers create a dangerous gap where everyone assumes “someone else” is dealing with deadlines.
A few key UK dates to keep in mind:
- Companies House accounts: typically due 9 months after the company’s financial year end (private companies).
- Corporation Tax payment: typically due 9 months and 1 day after the end of the accounting period.
- Company Tax Return (CT600): typically due 12 months after the end of the accounting period.
If the client structure is an RMC/RTM or SPV, it’s worth aligning the handover with proper year-end support through annual statutory accounts, and making sure the tax side is covered via company tax returns. If filings, confirmation statements, or directorship changes are part of the handover, you’ll also want company secretarial services in place.
And if VAT is in scope (commercial portfolios, mixed supplies, option to tax, or property-specific VAT issues), remember the VAT registration threshold is £90,000 in taxable turnover over a 12-month period. If you need support with registration, option to tax, and ongoing returns, see VAT return services.
For property-specific VAT and wider property tax questions, it’s often better handled by specialists — that’s where property tax accountants come in.
6) Reporting that keeps trust (and reduces challenges)
You’re not just managing numbers — you’re managing confidence. Your reporting should be clear enough that leaseholders, directors, landlords, occupiers, and auditors can follow it without feeling like anything is hidden.
Practical ways to keep reporting clean:
- Keep headings consistent (income, expenditure, accruals, prepayments, reserves)
- Separate routine costs from one-off projects
- Use plain-English notes for unusual items
- Make invoice trails easy to follow (invoice → approval → payment → allocation)
- Use tracking categories/cost centres properly (especially across portfolios)
If you’re taking over a mixed portfolio (blocks plus private landlords), it helps to avoid running 2 finance systems in parallel. For landlord-heavy work, landlord accountant support can be a useful bolt-on alongside your block reporting.
FAQs
What’s the biggest finance risk during a managing agent handover?
It’s usually uncertain balances — money that “looks right” but doesn’t tie back to liabilities, arrears, reserve funds, or known commitments. If you don’t rebuild reconciliations early, you can end up issuing demands that don’t reflect the true position.
How many months of records should you ask for?
Aim for 12 months minimum. If there are disputes, major works, big arrears, or inconsistent coding, ask for 24 months so you can see patterns and where issues started.
What should you do with invoices that arrive after the handover but relate to the previous period?
Use a handover holding category, log each item, and confirm approval responsibility before allocating it. The worst move is letting “crossover costs” disappear into general expenditure with no explanation.
What if you can’t get a clean bank reconciliation from the previous agent?
Assume you’ll need to rebuild it yourself from bank statements, supplier lists, and receipts. A clean reconciliation is the base layer for everything else — without it, service charge reporting becomes guesswork.
When should you bring in finance support during a handover?
If you’re inheriting messy records, multiple sites, disputes, or a year-end that’s close, get support straight away. Stabilising early is cheaper than repairing later.
Want a smoother handover (and fewer finance surprises)?
If you’re taking on a new block or portfolio and want the finance side clean from day 1 — reconciliations, service charge reporting, structured packs, and consistent processes — speak to the team at FHP.
Start here: contact us and we’ll help you get it set up properly.
I lead FHP Accounting, an accountancy practice specialising in Commercial and Residential Property Accounting. Our goal is to make the administration of running property portfolios easier for landlords, managers, and investors — allowing you to focus on what you do best, while we take care of everything behind the scenes.
