Managing cash while commission waits for registration
How an estate agency plans its cash when commission arrives only on registration, months after the sale, using its ledger and a weekly cash sheet.
By Achekam · · 5 min read · For Real estate businesses in South Africa, Nigeria, Kenya
An estate agency can have its best quarter ever on paper and still struggle to pay salaries. The sales were signed, the buyers' finance was approved, the champagne was opened. But commission is paid when the transfer registers, and between the signed offer and registration there are bond approvals, compliance certificates, clearance figures and the deeds office. Months can pass. Meanwhile rent, salaries, portal subscriptions and agents' draws fall due every month.
Planning cash in an agency is mostly about that gap: knowing what is coming, roughly when, and making sure the fixed costs can be covered while it is on its way.
Why agency income arrives in lumps
Three features of the business make cash uneven:
- Commission is large and irregular. A single sale can be worth more than a month's running costs, and two can register in the same week after a quiet month.
- Timing is outside the agency's control. Registration depends on banks, conveyancers, municipalities and the deeds office.
- Some sales never register. Finance falls through, conditions are not met, a buyer walks away. Commission that looked certain disappears.
Letting income, where the agency has a rentals side, behaves differently: smaller amounts, more regular. For many agencies it is what pays the bills between registrations, which is a reason to see it separately.
Sales in the pipeline versus commission invoiced
Two lists need to be kept apart.
Sales awaiting registration are not yet income. Keep them on a simple register outside the books: property, buyer, expected commission, conveyancer, the conditions still outstanding, and an expected registration month. Update it weekly from the conveyancers' progress reports. Mark each sale with how confident you are that it will register, and when.
Commission invoiced is in the books. In Achekam a business creates customer invoices as drafts that it can change or delete; issuing one takes the next number in its sequence and posts it to the ledger as debtors, sales and output VAT. Many agencies issue the commission invoice close to registration, so that the ledger reflects money genuinely due. How the invoice is timed and paid by the conveyancer is covered in commission invoices paid by the conveyancer.
The register tells you what might come. The ledger tells you what is owed. A cash plan needs both.
The age analysis of unpaid commission
Once invoiced, commission should not sit unpaid for long, but sometimes it does: a conveyancer's delay, a dispute over the split with another agency, a seller who disputes the amount.
Achekam ages receivables into 0-30, 31-60, 61-90, 91-120 and over 120 days, with overdue totals. Read it weekly. Commission in the older columns is a sign something has gone wrong after registration, and it needs a phone call to the conveyancer that day, not at month end.
A monthly budget for fixed costs
The other half of the plan is what must go out. A business can set a budget per account and period in Achekam and compare it with actual figures from its ledger.
Budget the fixed costs carefully, month by month:
| Cost | Why it matters for cash |
|---|---|
| Salaries and agents' draws | The largest and least flexible |
| Office rent | Fixed regardless of sales |
| Property portal and advertising subscriptions | Often paid in advance |
| Vehicle costs | Steady, easy to underestimate |
| Software, telephone, insurance | Small individually, significant together |
| Tax payments | Due on fixed dates whether commission has registered or not |
The total of those lines is the amount the agency must find every month. Compare it with the commission you are confident will register in that month, and the gap is what the agency's reserves or facilities must cover.
The management accounts help you review the plan against reality: an income statement for a chosen period beside the period before, and a balance sheet at period end, exportable as PDF or CSV. Note that the year-to-date preset starts on 1 January, not on your own year start, so choose the period explicitly if your year runs differently.
Reconciled bank balances rather than guesses
A cash plan starts from today's real bank balance, not the one somebody remembers. A business imports bank statements as PDF, CSV, Excel, OFX, QIF, MT940 or CAMT.053, and each import is checked so that the opening balance plus movements equals the closing balance. Bank lines are matched by suggestion and a person accepts each match; a line not yet in the books becomes a suggested journal a person approves; and a reconciliation completes only when nothing is left unexplained.
Import and reconcile weekly during busy months. A reconciled balance is a figure you can plan from. An unreconciled one includes money that may already be spoken for.
No cash flow statement yet: a simple weekly cash sheet
Achekam's books do not produce a cash flow statement. For planning ahead, that would not be enough anyway: a cash flow statement explains the past, and the agency needs a view of the next few months.
A weekly cash sheet does that job. Keep it in a spreadsheet, with one column per week for the next three months:
- Opening balance: the reconciled bank balance.
- Receipts expected: commission on sales likely to register that week, letting income, any other fees.
- Payments due: salaries, rent, subscriptions, suppliers, tax.
- Closing balance: carried to the next week's opening.
Fill receipts conservatively. Include only commission you are confident will register in that week; move doubtful sales to a later week or leave them out. When the closing balance in any week falls below the level you are comfortable with, you have time to act: delay a discretionary spend, talk to the bank, or chase a conveyancer.
ACCA's article on cash budgets explains why a business prepares one and how to build it from expected cash inflows and outflows, with a worked example. Fast-growing businesses with uneven income face the same question in other forms; runway and burn looks at it from a software company's side.
Set up the weekly cash sheet this Friday, start it from a reconciled bank balance, and update it every week from the conveyancers' latest reports.
General guidance only, not advice on your own circumstances. Tax and payroll rules change: check the current position with the authority or your adviser.
