There are many accounting and back-office software solutions for real estate brokerages today, and one size does not fit all. Many of REAL Trends’ clients use brokerWOLF, the software developed by Lone Wolf Technologies, and the reviews on its functionality are inconsistent at best.
Like many software platforms, the more information input into the system the more robust the reporting output. However, there does come the point where the cost of investing the time to populate each module outweighs the benefit of receiving meaningful and timely information.
I was afforded the opportunity to participate in an in-depth training session of brokerWOLF at Lone Wolf headquarters a couple of months ago. Here are my takeaways:
Control Features
Many brokerages have multiple offices, some grown organically and others acquired. Does this matter when talking about brokerWOLF? It does! Each instance of brokerWOLF is specific to one Federal Employer Identification Number (FEIN). Therefore, if you have offices that have different FEINs, you won’t be able to integrate the data in brokerWOLF to report on the company as a whole.
Similarly, if you have agents who sell out of more than one office, you can’t assign them to multiple locations in brokerWOLF. The agent identifier links to only one office. The workaround for this is to create alternate agent identifiers specific to each office.
In brokerWOLF, it’s standard to enter an agent’s license number and expiration date into his or her record. So, what happens if an agent’s license expires or the renewed license information fails to make its way into the system? Believe it or not, the system will not allow you to attach an agent to a new transaction or commission check if that agent’s license is showing as expired. That’s a nice supplemental control!
Accounting for Teams
Teams are much more prevalent in today’s residential real estate industry than they were ten years ago. The additional complexity of tracking team activity can be cumbersome and, oftentimes, the administration of that activity is manual. I learned that brokerWOLF can be set up for teams, where team staff members can be linked under the team lead but still retain their own records. Splits and fees can be assigned to each team member, and the software calculates amounts for every transaction.
Is This Working Correctly?
Sometimes it is difficult to know whether or not your system is operating as it should. Below are a couple of reports whose output may indicate that something within your system—or operations—has gone awry. Be sure to pay attention to the date ranges and parameters being used on the reports you are running to avoid differing output for the same metric.
- Transaction Action Report (2.P.1.2).This report shows outstanding items for all of your sub-ledgers that are impacted by a transaction. The report should be blank. If it shows outstanding items, then some clean-up may be required.
- Analysis of Deposits (3.A).When a transaction is closed in brokerWOLF, the system automatically relieves the trust liability as part of the accounting entry. As the trust account holding the funds will not decrease until the monies have been moved from it, there may be a difference between the Trust Account and the Trust Liability Account.
The opposite can be true if funds are extracted prior to the transaction being marked as closed in the system. Either of these scenarios does not necessarily indicate that there is a problem. However, the transactions that are out of balance should be current. If your Analysis of Deposits report is showing entries in the No Funds Remaining section, and they are months or years prior, you should research as soon as possible as it may indicate a larger issue.
Although accounting and back-office software may not be something that you want to dedicate a significant amount of time with, a little research and familiarity with your system can result in a higher level of operating efficiency for your brokerage. As we see, across all brokerages, gross margin compression; profitability more than ever relies more heavily on the management of operations and less on GCI.