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Subject: corporate accountant is authorized to speak to board members other than the treasurer.
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Author Messages
MaryL11
(California)

Posts:1


02/12/2018 3:50 PM  
I was elected to our Board of Directors in November. I have questions on our financials that cannot be answered by our Treasurer. Our association manager indicates that our HOA will be charged an hourly fee for "research" to respond to my questions. I do not feel extensive research is required. I have provided names of each report, account numbers, check numbers, and amounts for the information I am requesting. The four other board members give a blanket acceptance to our financials with the reasoning that the management company is being paid to handle all finances for us. However, as a fiduciary, I have trouble approving items that are not clear to me.

Am I within my rights as a board member to expect an explanation for accounting practices that appear to misrepresent our finances without having our HOA charged additionally for this information?
TimB4
(Virginia)

Posts:16005


02/12/2018 4:18 PM  
Are you within your rights to ask? Absolutely.

Can you insist on no additional charges? That would depend on the terms of your contract with the MC.
KerryL1
(California)

Posts:5852


02/12/2018 5:12 PM  
First, with Tim. what does your contract with the Management Company (MC) say about the talks they do for you.

I assume they, they do take care of all your accounting matters since you indicate the Board has not trouble with the monthly "financials."

Every month when our board members receive the monthly financials online, our Prop. mgr. (PM) invites us directors to ask her questions about them. If she cannot answer them--and she can 90% of the time--she asks the had accountant at our MC. we are NOT charged extra.

Perhaps you can send your PM a few questions about the most recent month's financials to see if she'll reply.


Is your PM certified in any way? What kinds of questions are you asking, Mary? Is there a larger issue that's conceding you?


RichardP13
(California)

Posts:3107


02/13/2018 12:15 PM  
Speaking as a management company, I understand someone wanting a clearer understanding of how the finances of their association is being handled. There are some good managers out there that do understand how finances in HOA's works, but for the most part, many don't, again this is from experience. If the management company has a separate accounting department, someone from that department should be willing to answer all your questions.

From experience, mistake do happens, but if pointed out, can be readily fixed.

While it should happen, relationships between Board members, homeowners and management companies are political.

Are your questions to the MC general in nature or specific? You need to remember, many treasurers of HOA boards have no experience in HOA finances, they are a warm body filling a position, again, from personal experience.
GenoS
(Florida)

Posts:2466


02/13/2018 5:24 PM  
Posted By MaryL11 on 02/12/2018 3:50 PM
The four other board members give a blanket acceptance to our financials with the reasoning that the management company is being paid to handle all finances for us. However, as a fiduciary, I have trouble approving items that are not clear to me.

Good for you, and I think you should absolutely be able to see those. My board here operates pretty much the same way. I regularly spot things that look "odd", maybe one a month or so, and no one else even notices or bothers to question them. Often there's a simple explanation but there are times when a legitimate mistake or error in the books occurs. I think it's irresponsible for a board to just assume that your MC will always do things 100% correctly just because you're paying them to do it.
KerryL1
(California)

Posts:5852


02/13/2018 6:29 PM  
With Geno, Mary, I agree that it's good that you watch the financials carefully and ask questions. And it's too often sadly true that the treasurer knows nothing about them.

Our first treasurer after turn over form the developer was a CPA so the then-Board thought he understood the financials. but he knew nothing about reserves and we new directors inherited a mess!
SueW6
(Michigan)

Posts:325


02/14/2018 7:19 AM  
Mary, could you give an example question you have?

Seems like if the Board passed a budget, then it will know - by way of a Y-T-D monthly report - exactly where they are in regards to revenue and spending.

Or is this a reporting question?

What reports are you getting each month?
KerryL1
(California)

Posts:5852


02/14/2018 12:59 PM  
Sue ska good questions, Mary. Are you still with us?
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