QUESTION - I'm looking for a name I can associate with this specific type of accounting practice and whether this would be considered good accounting, bad accounting, doesn't matter, depends, etc?
Scenario - There are 2 owners of a residential building, the rents come in, bills come in, etc, etc. After all fees, bills, etc. are paid there is a specific amount left over, but instead of paying out the remaining balance to each owner, only a percentage or flat amount is paid out to the owners leaving the remaining amount in the account.
Ex. $20K in rents come in and $5K in bills are paid leaving $15K to pay out to the 2 owners. Now instead of paying each owner $7.5K each, each owner gets $5K each, which leaves $5K in the account. This left over amount slowly builds ups or accrues over time.
Additional Info - If one or more tenants do not pay rent on time or miss a month, then what the manager does is payout the flat amount (ex. $5K) regardless of the amount that has come in for the month and pulls the difference needed from what's been saved/accrued from previous months, if less than $10K, to get to the flat rate of $5K.