FINANCIAL OPERATIONS FOR
COMMUNITY ASSOCIATIONS
Financial operations are a critical part of the management of any operation, so it is essential
that they are carried out with integrity. The board of directors, particularly the financial
director, is ultimately responsible for an association’s funds and may not abdicate their
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BEST PRACTICE:
Introduction to financial operations
Given the reality that comm unity association boards are made
up of diverse individuals with varied degrees of financial
knowledge, it is important that the policies, procedures and
guidelines necessary to ensure sound financial operations be
spelled out clearly for all.
investments on a quarterly basis.
• • Require at least two board members’ signatures to gain
access to reserves.
• • Require at least two authorised signatures on all cheques
over a predetermined amount, as established by the board
of directors.
• • Require the board member responsible for a particular
Banking portfolio to sign the invoice, and another board member
• • Maintain the association’s funds, including the replacement done via internet banking, then yet another board member
to sign the authority document. If the payment is being
fund (commonly called reserves) and operating fund, in should do the release once the administration office has
separate accounts in the association’s name, and ensure processed the payment.
that the board has direct access to the accounts.
• • Maintain an operating cash balance of approximately two
months’ expenses.
• • Reconcile the bank statements and investments monthly
(or at least quarterly).
• • The board member charged with reviewing the bank
statements should not be responsible for payment of bills
and/or signing of cheques.
• • The full board should review copies of bank statements and
Planning
• • Establish a long-term financial plan for all assets, and
review and revise it annually.
• • Develop written, board-approved investment policies and
procedures.
• • Commission a reserve study and/or update the current
reserve study at least every three years and review the
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