Financial Services
Accounts Receivable
Each community has a dedicated bank account with lockbox service and online payment options. CMS will set up all units/lots as platted upon takeover and update on a regular basis. We will supply coupons for monthly assessments or invoicing for annul or semiannual assessments. We will also handle all collections of delinquent accounts.
Accounts Payable
Our team will only pay invoices with verification of services in written contract and/or approved and coded per Community budget by Community Manager. All invoices in excess of prescribed limits in Management agreement will have prior approval by Treasurer or Board of Directors per meeting minutes or written approval.
Vendor and Contract Management
All recurring and one time capital projects over $1,500.00 will have a Request for Proposal (RFP) with work scope and specifications prepared by the Community Manager with input from the Board of Directors or a designated committee. All projects requiring engineering or other specialized language will be referred to an appropriate professional for such input. Competitive bids from vendors on the Qualified Vendor List will be sought for all major recurring needs such as swimming pool maintenance, snow removal, lawn care, pond and fountain maintenance etc.
Monthly Financial Statements
In a secure area of our website or the community’s website our clients will be able to access all accounting and monthly reports in PDF format – no need to store bulky paper copies. The following reports are produced monthly:
Balance Sheet
Accounts Receivable Report (Receivable Listing)
Accounts Payable Reports
Check Register
General Ledger
Delinquent Assessment Account Status
Collection Report
Trial Balance
Budget Variance Report with Month/YTD Comparisons and Narrative
Capital/Reserve Income/Expense Analysis
Checking and Savings Bank Account Reconciliation’s
Separate Accounting/Financial Statements for Umbrella or Sub Associations as requested
Bank statement(s)
Budget Preparation
The Community Manager will meet with the Association Budget Committee at least 90 days in advance of expiration of current year budget to prepare the new operation and capital budgets. Topics to be researched in consideration of the budget are as follows:
Operating Expense History
Current Operating Expenses
Operating Expense Trends and Anomalies
Anticipated Changes in Operating Expenses
Utility Rate Changes Anticipated
Property Tax Rate/Assessment Changes
Addition or Deletion of Amenities or Services
Review Policy Changes that may affect Operating or Capital Expenses
Review of Capital Reserve Analysis – Revisions
Competitive Bids for Contract or Capital Expenses
Economic Variables – Interest Rates, etc.
Legal issues – pending collections/suits etc.
Special Projects to be Considered
The Community Manager, with input from the Board of Directors, will be responsible for writing the Work Scope and Specifications for all contracts and projects and obtaining preliminary pricing for the budget. Once the budget is approved (per the Documents – by the Board or the Association, we will make the budget available for homeowners.
Capital Reserve Analysis
The Community Manager will assist the Association in preparation of the capital reserve analysis. We will provide a list of qualified engineers and consultants to provide a thorough inspection and condition report. Funds needed will be evaluated based upon the physical life of building elements, common area facilities, etc. This will be bid based upon the work scope and specifications. The Capital Reserve Analysis is the backbone for the long term financial plan for the Association. The Internal Revenue Service may request to evaluate this important tool to determine whether the savings that the Association is accumulating is exempt from taxation.
Tax Preparation and Planning
The Internal Revenue Service has been aggressive in pursuing the Not for Profit status of many Homeowner Associations. There is particular treatment given for Condominium Associations (aka Horizontal Community Regimes (HPR)) and the need for timely filing of state required reports and tax returns. The Community Manager will give the Association bids for preparation of the tax return by qualified Certified Public Accounting firms. It is our recommendation that tax audits and reviews be completed by an accountant chosen by the Association. We are happy to provide a list of accountants who specialize in Homeowner Associations.
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