Getting a Return on Your Investment Budgeting Advice from the Professionals

There are as many different kinds of co-op buildings, condo associations, and HOAs as there are people who live in them. Different types of communities often have very different ways of hammering out policy and directing their own day-to-day business, but there are a few constants that every community—regardless of size or demographic—must address.

One of those is the annual budget, and as most board members and trustees of HOAs and condo associations aren't licensed accountants by trade, spelling out the fiscal year and balancing an entire community's books can be a rather daunting task. While most any board or association can benefit from the advice and guidance of a financial professional, the following information may serve to bring up some talking points to take up with your own team of professionals at your next meeting.

Whose Job Is It?

Generally speaking, it's the board of directors' fiduciary responsibility to prepare the budget for their community association or building. If an HOA uses a management company (and most do), the management company and the board—or if it's a large community, the board's appointed financial or budgetary committee—work together to develop a workable budget.

There are variations on that theme, of course. According to Karen Sackstein, CPA, an accountant working in Fairlawn, "Normally, the budget is prepared by the property manager under direction from the board, depending on how large the association is and how involved the accountant is in the operations. The budget is usually prepared two or two-and-a-half months before the end of the fiscal year so it can be tweaked and ready to go on the first day of the New Year."

According to Jules Frankel, CPA, MBA with the accounting firm of Wilkin & Guttenplan PC in East Brunswick, "A management company's responsibility is putting together the primary budget. The budget is normally reviewed with the board or finance committee before it's finalized."

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