CAM Reconciliation Pre-Send Checklist
12 checks before you send anything
Disputes rarely come from bad intentions. They come from a December invoice that never got posted, a gross-up formula applied to the wrong accounts, or a BOMA denominator that hasn't been touched since 2017. Run this list before you send anything.
The 12-Point Checklist
1. GL Exclusion Scrub — Remove CapEx from the recoverable pool
Why: CapEx inclusions drive 30% of all CAM disputes (BOMA International; see Sources & Methodology). One roof replacement coded to the wrong account poisons the entire statement.
Verify against: Lease exclusions clause; property CapEx schedule for the fiscal year.
2. Variable vs. Fixed Expense Classification — Separate variable expenses from fixed before running any gross-up
Why: Gross-up can only legally apply to variable expenses. Applying it to fixed costs — landscaping, property taxes, insurance — is a breach of IREM standards and the first thing a forensic auditor checks.
Verify against: IREM expense definitions; lease gross-up clause expense categories.
3. Gross-Up Calculation Audit — Variable expenses only, correct occupancy %, correct target from lease
Why: A misapplied gross-up either contaminates the base year or inflates tenant bills. Both are recoverable by audit firms.
Verify against: Gross-up clause target occupancy % (typically 95% or 100%); actual move-in/move-out occupancy log for the fiscal year.
4. Pro-Rata Denominator Reconciliation — Confirm building RSF basis matches the standard cited in the lease
Why: Denominator errors compound across every line item — a wrong denominator creates 5–10% systemic variance across the entire rent roll.
Verify against: BOMA standard cited in lease (1996 / 2010 / 2017 / 2024); most recent measurement certificate.
5. Mid-Year Occupancy Adjustment — Time-weight all SF changes for tenants who moved, expanded, or contracted
Why: Applying year-end SF to the full 12-month period is a contractual breach. Audit firms find this in the first 30 minutes of any review.
Verify against: Lease amendment execution dates; PM software tenant SF history report.
6. Pro-Rata Share Math — Confirm all shares sum to ≤100%
Why: Shares above 100% means double-collecting. Shares below 100% means revenue leakage. Both are structural errors that surface immediately in any competent audit.
Verify against: Sum of all tenant RSF ÷ building RSF denominator = ≤1.00.
7. Tenant-Specific Lease Exclusions — Remove exclusions before calculating, not after
Why: Billing even one excluded expense invites a full forensic audit of the entire GL. The exposure is not limited to the single line item.
Verify against: Lease abstract exclusions clause per tenant; Yardi/MRI recovery pool configuration per tenant ledger.
8. Cap Structure Verification — Apply the correct cap logic: cumulative vs. non-cumulative, controllable only
Why: Misapplying a cumulative cap as non-cumulative (or the reverse) creates 5–15% billing errors. Tenants with sophisticated lease administrators will catch this immediately.
Verify against: Cap clause language — base period, cumulative vs. non-cumulative, cap %; prior-year CAM actuals as the base.
9. Controllable vs. Uncontrollable Segregation — Taxes, insurance, and snow removal bypass the cap
Why: Applying caps to uncontrollable expenses is a lease violation. Missing the carve-out for taxes and insurance is a landlord undercharge.
Verify against: Lease cap clause definition of "controllable"; GL account mapping — taxes (GL 6XXX) vs. controllable maintenance.
10. Management Fee and Administrative Markup Audit — One fee, one calculation base, no corporate overhead in the pool
Why: Duplicative management fee structures have produced $9M recoveries in single-lease audits. In Texas, undisclosed fee methods violate Property Code §93.012, rendering the entire assessment invalid.
Verify against: Lease management fee clause (calculation base + % ceiling); GL management fee account contains only the third-party PM fee.
11. Vendor Invoice Completeness — Close AP before the statement closes — chase stragglers now
Why: A December invoice posted in February cannot be back-billed in most leases. The landlord absorbs the shortfall permanently.
Verify against: AP aging report filtered to prior fiscal year; active vendor contracts vs. posted invoices; year-end accruals.
12. Statement Delivery Deadline Verification — Know your billing window per tenant before you send anything
Why: Missing the contractual billing window permanently forfeits the true-up balance. Sophisticated tenants will refuse payment citing landlord breach.
Verify against: Reconciliation clause deadline per lease; delivery schedule sorted by earliest deadline across the rent roll.
Already past the send date? Use this list differently
Each item on this checklist maps directly to a document in the dispute response package. If you have already sent the reconciliation and received a dispute letter, work through the list in reverse: the items you skipped before sending are the gaps the tenant's auditor will find first. See the dispute response guide for the full process.
Related Resources
- What Tenant Auditors Look For — The other side of this checklist
- Tenant CAM Dispute Response Guide — What to do after the letter arrives
- CAM Leakage Estimator — Quantify your exposure before you send
Frequently Asked Questions
How far back can a tenant dispute CAM charges?
The lookback period is contractual — defined in the audit rights clause. Most commercial leases give tenants 12 to 36 months from statement delivery. A tenant who signed a 36-month audit window can dispute a reconciliation statement that is nearly three years old. In California, SB 1103 gives qualifying small-business tenants the right to request documentation for CAM charges assessed up to 18 months before the written request date.
What documents does a landlord need to respond to a CAM dispute?
Six documents cover most disputes: the general ledger with chart of accounts, the gross-up calculation showing monthly occupancy as the source, the management fee base statement cross-referenced to the lease clause, original vendor invoices organized by month and expense category, monthly occupancy records from the rent roll, and a lease abstract covering expense inclusions, exclusions, gross-up, cap structure, admin fees, and audit rights. Missing any of these weakens your position even if the underlying numbers are correct.
Does running this checklist before sending prevent tenant disputes?
It reduces the frequency and severity of disputes, not the possibility. The checklist catches the errors auditors find most often — gross-up on fixed costs, cap rate format errors, admin fee sequence issues, and pro-rata denominator mismatches. A reconciliation that passes all 12 checks is still auditable, but a tenant auditor who requests records will find a complete documentation package rather than gaps that inflate the apparent error rate.
Automate Checks 1–9 in Minutes
CapVeri runs GL scrub, gross-up validation, pro-rata math, and cap structure checks automatically — using your own GL export and lease abstracts.
Start Free AuditSources
- BOMA measurement standards — BOMA
- IREM CAM reconciliation presentation — IREM Oregon (PDF)