The Growing Case for Outsourced Accounting in Vacation Ownership Resorts

Running a vacation ownership resort involves far more than managing reservations and maintaining the property. Behind the scenes, accounting teams must process owner assessments, pay vendors, fund reserves, track capital projects, and prepare financial information for boards, owners, and auditors. As these responsibilities become increasingly complex, many vacation ownership resorts and management companies are choosing to outsource their bookkeeping functions.

Outsourcing can provide access to experienced accounting professionals, modern technology, and scalable resources without the cost and challenges of maintaining a fully staffed in-house accounting department. For many resorts, it has become a practical way to improve efficiency while maintaining strong financial oversight.

Outsourcing the accounting function can allow board members to focus on managing and improving their resort rather than being overwhelmed by the tedious tasks of day-to-day accounting. Many resorts are managing aging infrastructure, increasing insurance costs, major reserve projects, and heightened owner expectations, all of which place additional pressure on accounting and financial reporting functions.

“Outsourcing the accounting function can allow board members to focus on managing and improving their resort rather than being overwhelmed by the tedious tasks of day-to-day accounting.”

Maintaining Continuity in an Increasingly Complex Financial Environment

Continuity and Staff Turnover

Turnover often occurs at the most inconvenient times, such as during budget preparation, audit fieldwork, or major capital projects, making continuity of accounting knowledge especially valuable. Outsourcing the accounting function can reduce the disruption caused by employee turnover.  In many cases, a resort’s internal accounting team is small, and the loss of one person can disrupt both operations and financial reporting while increasing the risk of fraud.  An outsourced function is more likely to offer a team of trained professionals, which helps prevent disruption and preserve institutional knowledge.

Industry Expertise

Expertise is the other big draw to outsourcing. Because vacation ownership resorts are frequently structured as (or are responsible for the accounting of) property owners’ associations, they must follow a specialized set of accounting rules. FASB’s Topic 972 addresses the unique accounting and reporting specific to owners’ associations and governs how associations recognize revenue, report common property, handle reserves, and report financials using fund-based accounting. State regulations can further complicate accounting and compliance rules. The State of Florida, for example, has specific financial statement presentation and reporting requirements. Outsourced accounting services stay current with these standards, allowing boards to focus more on the association’s governance.  In addition to technical accounting requirements, experienced providers often understand the unique operational structure of vacation ownership resorts, including owner assessments, reserve funding, special assessments, rental programs, capital improvement projects, and board reporting expectations.

Seasonality and Scale

Resorts can experience seasonal fluctuations in activity levels, annual budget cycles, audit preparation periods, and major capital or special assessment projects. Outsourced accounting teams can scale services up or down based on the resort’s needs, providing flexibility that may be difficult to achieve with internal staff alone.

Systems and Data Security

Outsourced accountants typically bring resources (accounting software, automated and online payment options, secure data storage, and reliable backups, among others) that would be far more costly for an association to acquire on its own. Modern accounting platforms can also provide management teams and boards with faster access to financial information, customized reporting capabilities, and greater visibility into resort operations and financial performance.

Internal Control and Fraud Prevention

Strong internal controls are essential to safeguarding owner funds. An outsourced accounting provider can help establish segregation of duties, approval workflows, and independent review processes that may be difficult to implement in smaller accounting departments. These controls can reduce risk and improve financial transparency. Independent oversight and consistent processes can be particularly valuable for self-managed resorts or organizations with lean accounting departments.

“Strong internal controls are essential to safeguarding owner funds.”

Related – Understanding the Financial Framework Behind Vacation Ownership

Helping Boards Navigate Today’s Financial Challenges

Managing Rising Costs and Financial Complexity

Resorts today face increasing pressure from inflation, rising insurance premiums, labor shortages, aging facilities, and growing capital expenditure needs. As these financial challenges become more complex, timely and accurate financial information is critical to supporting informed decision-making by boards and management teams. Outsourced accounting can provide the reporting and financial oversight necessary to navigate these evolving challenges.

Choosing an accounting provider should involve careful due diligence, clear communication expectations, and an understanding of the resort’s unique needs. However, for many vacation ownership resorts and management companies, the benefits of improved continuity, specialized expertise, and operational support outweigh the reduced direct oversight. Ultimately, outsourcing can enable boards and management teams to spend less time managing accounting processes and more time focusing on strategic initiatives, owner satisfaction, and the long-term success of the resort.

ABOUT WITHUM

Withum is a forward-thinking, technology-driven advisory and accounting firm, committed to helping clients in the hospitality industry be more profitable, efficient, and productive in the modern business landscape. For further information about Withum and their cybersecurity, digital advisory and hospitality services teams, contact Lena Combs (LCombs@Withum.com) at (407) 849-1569, or visit www.withum.com/hospitality.

Contributor Note

Lena Combs, CPA, CGMA, is Partner and Hospitality Services Team Leader at Withum, where she specializes in serving the hospitality and vacation ownership industries. She advises resorts, associations, and management companies on accounting, financial reporting, governance, and operational best practices.

Connect with Lena on LinkedIn: linkedin.com/in/lenacombs.