Estimated Payment True-Up Error: When the Year-End Balance Due Is Wrong by Thousands
If your landlord's year-end reconciliation 'Balance Due' is higher than the difference between your actual CAM share and what you paid in monthly estimates, you're being overcharged. For a tenant paying $3,000/month in estimates, even a $3,200 arithmetic error on a single true-up is money that was never owed.
Definition
An estimated payment true-up error occurs when the year-end reconciliation balance billed by the landlord exceeds the mathematically correct true-up amount. The correct true-up is calculated by taking the tenant's actual share of total building operating expenses for the year, which equals the total building expenses multiplied by the tenant's pro-rata share percentage, and subtracting the cumulative monthly CAM estimates the tenant already paid throughout that year. Any amount billed above that difference, after applying a rounding tolerance, is an arithmetic overcharge. These errors occur most often when landlords compute the year-end balance in a spreadsheet separate from their property management system, introducing stale estimate totals, wrong pro-rata percentages, or simple arithmetic mistakes. CAMAudit's true-up detection rule extracts all three required inputs from the uploaded documents and performs the correct calculation, then compares it to the billed Balance Due to identify any overage.
The true-up is an arithmetic calculation with one correct answer. Actual tenant share minus estimates already paid equals the balance due. Any deviation beyond a rounding tolerance is a billing error.
How we detect
- 1
CAMAudit extracts the landlord's billed true-up amount from the reconciliation statement, specifically the line labeled 'Balance Due,' 'Year-End Adjustment,' or a similar designation. CAMAudit identifies this figure as the starting point for the arithmetic verification.
- 2
CAMAudit's true-up detection rule calculates the expected true-up using three inputs extracted from the uploaded documents: the total building operating expenses from the reconciliation statement, the tenant pro-rata share from the lease, and the cumulative monthly estimates the tenant paid throughout the year. CAMAudit multiplies the building total by the pro-rata share to derive the actual tenant obligation, then subtracts the estimates paid.
- 3
CAMAudit flags the finding as an overcharge when the billed true-up exceeds the calculated expected true-up by more than the tolerance, which is the greater of $50 or 0.5% of the tenant share of actual expenses. CAMAudit reports the exact dollar difference between what was billed and what was owed so you can present the specific arithmetic in a dispute.
Real-world example
Charleston County, SC government leases office space managed by Thalhimer as property management agent. Public A/P records show the county wired a ,000 CAM reconciliation payment in March 2019. In the fixture scenario: building total operating expenses of ,000 tenant at 10% pro-rata share, actual tenant share of ,000 monthly estimates paid of $3,000 times 12 equals $36,000. Correct true-up: $5,283.76. Landlord billed: $8,500.00. CAMAudit flagged the $3,216.24 overcharge.