Glossary
Calculations & Formulas
Gross Receipts
The total revenue figure some management fees and percentage-lease rent are calculated against. Leases usually define exactly what counts, and what's excluded, like sales tax or returns, but landlords sometimes apply a broader receipts definition than the lease actually authorizes.
Firm impact
A management fee or percentage rent calculated on the wrong receipts base compounds every reporting period. Confirming the fee base matches the lease's actual gross receipts definition is a quick check that can catch a persistent, recurring overcharge.
How this gets abused
A lease defines gross receipts to exclude sales tax, returns, and employee discounts. The landlord calculates percentage rent, and in the same statement a management fee, using total register receipts before any of those exclusions, inflating both charges by 6 to 8% every month.
Practitioner note
Pull the exact gross receipts definition and exclusion list from the lease, then request the client's underlying sales data to test whether the landlord applied the same definition. A management fee calculated on gross receipts instead of base rent or CAM costs is worth double-checking against the fee clause.
Related terms
FAQ
Questions about gross receipts
Is gross receipts the same in every lease?
No. Each lease defines gross receipts on its own terms, including what's excluded, like sales tax, returns, or delivery charges. Firms should never assume a standard definition applies.
Why does the gross receipts definition matter for a management fee check?
If a lease bases the management fee on gross receipts rather than base rent or total CAM costs, using the wrong receipts figure changes the fee amount directly. CAMAudit's management fee rule tests the fee against the base the lease specifies.
You know the term. Now check the math.
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