Category Archives: Budgets

It’s Budget Season!

Most associations have about ready to start creating the 2013 budget and as this article from the Chicago Tribune indicates budgeting isn’t just about increasing things across the board or refusing to increase assessments at all — it’s about a thoughtful process. 

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Best Practices for a Smooth Budget Process

Does your association have a budget? If it does, how is it prepared? Is it even followed? Here, we provide tips for creating a budget process that works well for nearly all associations.

 Know fundamentals first

Start your budget process by understanding why budgeting is important. Aside from the obvious benefit of creating a well-run association, having a solid budgeting process helps protect the value and marketability of your association’s units. Without it, lenders may be unwilling to lend for the purchase of a unit or to the association, and buyers may feel burdened and walk away because they don’t want to assume the fallout of bad decision-making in prior years.

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Reserve Study Service Levels

It is just beginning to be that reserve study time of year. Why? It takes a little while to select a reserve professional and get the reserve study scheduled. And, you need to have the reserve study completed before you can complete your budget for next year.
Although state statutes generally permit anyone to perform the reserve study, asso-ciations should consider engaging a qualified, independent reserve professional. There are two professional designations available; the PRA (Professional Reserve Analyst) conferred by APRA, the Association of Professional Reserve Analysts, and the RS (Reserve Specialist) designation conferred by CAI (Community Associ-ations Institute). Both of these designations require the reserve professional to have completed at least 50 reserve studies and have at least one year of reserve study experience.

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Association Finances:

Understanding Your Community’s Financial Position in a Tough Economy

While it is always important to know where your community stands financially, it is especially important to understand the community’s financial status in an economy riddled with increasing expenses, higher delinquencies, and more bad debt write-offs. Following are several recommendations and standards for analyzing a community’s financial health:

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* These articles and related content on this website are provided without warranty of any kind and in no way consitute or provide legal advice. You are advised to contact an attorney specializing in Association Management for legal advice related to your specific issue and community. Some articles are provided by thrid parties and online services. Display of these articles does in no way endorse the products or services of Community Association Management by the author(s).