Effective Financial Management for Orlando Homeowners AssociationsLiam Pool
One of the best reasons to hire a professional community management company is to keep your HOA’s financial reports and accounting practices organized, compliant, and well-documented.
There are hundreds of details to juggle when it comes to an HOA’s accounts receivable, accounts payable, budgeting, forecasting, and reserves. Responsible HOA boards will want to avoid the risk of fraud and embezzlement, and they’ll want to make sure that everything is clear, transparent, and accurate for their homeowners.
The HOA communities we work with count on us to provide sound financial oversight and management. Here are some of the things that make our work so effective.
Basics of Good HOA Accounting
Every HOA needs to be budgeting, shoring up a reserve fund, and auditing the accounts to prevent fraud and mismanagement. You need a short term spending plan, a long term budget, and a consistent way to follow the law, collect the dues, and pay the bills. There are also taxes to consider, insurance, and vendor contracts.
With a professional management partner like us, you can delegate these financial tasks to a team of experts who understand the requirements and best practices of HOA accounting.
Establishing Your HOA Budget
Budgeting requires an attention to detail and a strong support system. Your Orlando property management company should provide that. We help with establishing and following association budgets.
There’s a lot to be learned from history, so our process starts with reviewing your current and previous HOA budgets. We look closely at the expenses and make adjustments for the new budget. It’s pretty common that things cost more than expected, so this review should give you a good idea of what you’ll have to spend in the coming year.
As we begin to establish a forecast for the coming year or even the next five years, we evaluate any projects and expenses that are imperative. Maybe the clubhouse needs new paint or the exterior lighting needs an update. Orlando has a hot and humid climate, so we’ll always be looking at preventative air conditioning and HVAC services.
The budget we help you create will be based on past years and the current year, while taking into consideration what your community will need now and in the future. We measure the expenses you’re forecasting against the projected income from fees, dues, assessments, and penalties.
Analyzing HOA Reserves
Every time we talk about financial performance and budgeting, we’re going to conduct a thorough reserve fund analysis. The HOA board is responsible for updating the analysis of reserve funds, and we can help you make sense of the process. You need to be sure your homeowners are contributing enough to cover expected expenses as well as surprise expenses that might come up. If a roof caves in and you’re not prepared financially, there’s going to be a lot of trouble when it’s time to replace that roof.
These are some of the high-level functions that make our accounting practices effective and efficient. We’ll review vendor contracts as well, collect delinquent dues and payments, and make sure all of your association’s books are in order.
This can be a tremendous help to busy HOA boards. Contact us at Homevest Management to talk more about how we can help your Orlando HOA with better financial management. We provide expert Orlando property management, real estate, property rentals, and HOA management. We serve all of central Florida, including Winter Garden, Doctor Phillips, Baldwin Park, Winter Springs, and Windermere.