The Puzzle of the Current FPLOA Reserves - by Laura Barth

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As a candidate in the 2012 Board vacancy election, I believe I have the knowledge and experience to bring positive changes to the budget and financial reports currently in place. People have asked me what is the advantage of being CMCA certified. The National Board of Certification for Community Association Managers has the only nationally accredited certification program in the field. The 4 steps for completion of the program are: •Coursework in accounting, collections, ethics, finance, governance and the law. •A rigorous examination. •Adherence to a code of professional standards and ethics. •Commitment to continuing education and professional development. That being said, If you were to review the Budget Income/expense statement one year ago April, under Reserves, you would see a very clear picture. Approved budget for the year from assessment income - $288,000 ($24,000 each month). The YTD figure is $112,664.75 positive income (income for the year - expenses paid). By end of July, there is a positive income amount of $128,509.89. There are no published reports for August and September. However, by accounting rules, if you add the additional $48,000 due to Reserves (2 mos. X $24k) and subtract whatever expenses were booked, you should have a total figure for year end. This is not hard (think of the checkbook). $128,509.89 + $48,000 = $176,509.89. Approved budget accounts are fire mitigation, insurance, major road improvements, excess snow removal and snow fences. Just take the checks written for those accounts, total them and subtract from the booked income. Now, looking at this year; the September 30 balance sheet shows that $94,490.34 is in Reserves (not including the existing C.D.s - already allocated $400k). This tells me there were remaining funds. Reports this year do not show a division of the operating and reserve funds. As was reported the previous year, the Reserve fund should have the portion of assessments reflected on a separate line as per approved budget ($382,200/12 = $31,850 each month). So by hunting through the monthly reports; I come up with this at end of April 2012.Start with the $94,490.34 balance, add 7 months budgeted income to reserves $222,950 which equals $317,440.34. Then subtract all the budgeted expense accounts as reported by the bookkeeper year-to-date April. Fire mitigation, $6,357.93 + signs, $3,586.15 + roads, $54,683.71 + Administration bldg., $108,442.47 = $173,070.26. You get a positive number of $144,370.08. The reserve savings account shows an amount of $100,083.71 at end of April. If you take out the admin building costs, the reserves should reflect a positive balance of $252,812.55? Interesting, didn’t we all get an email blast stating that the admin. building was paid completely out of managed funds? What does that mean? According to the bookkeeper, we’ve got a lot of unspent budget for repair and maintenance of roads. Did payments on the new road grader flow out of this fund before any work has been done? Will we ever know? Submitted by Laura Barth, CMCA Certified