The controller’s office is responsible for all accounting functions of the Association, including the banking and recording of all income and expenses of the Association. The Controller is responsible for the production of periodic financial reports, maintenance of an adequate system of accounting records, responsible for cash management and risk management, and maintaining a comprehensive set of controls and budgets designed to mitigate risk, enhance the accuracy of the Association's reported financial results, and ensure that reported results comply with generally accepted accounting principles standards. Position reports to the General Manager of the Association.
The financial statements are prepared on the accrual basis of accounting and in conformity with professional standards applicable to not for-profit entities whereby revenues are recognized when earned and expenses are recognized when incurred.
The Association's governing documents provide certain guidelines for its financial activities. To ensure the observance of limitations and restrictions on the use of financial resources, the Association maintains its accounts using fund accounting. Financial resources are classified for accounting and reporting purposes in two funds established according to their nature and purpose. The operations fund is used to account for the financial resources available for the general day-to day operations of the Association. The replacement fund is used to accumulate financial resources designated for future major repairs and replacements.
Membership in the Association is mandatory by virtue of unit ownership. Association members are subject to annual assessments, usually payable in equal quarterly installments, to provide funds for operating expenses and major repairs and replacements. In addition to regular annual assessments, special and/or emergency assessments may be imposed by the Association's Board of Directors, under certain circumstances without member approval. Any excess assessments at year end are retained by the Association for use in the succeeding year.
Assessments receivable at the balance sheet date represents the aggregate amount of assessments due from unit owners. The Association's policy is to retain a collection service and/or legal counsel and place liens on the properties of owners whose assessments are delinquent. In certain instances, foreclosure may be necessary. The collection process is explained in greater detail in the annually distributed delinquent assessment collection policy. Because of these collection procedures, the Board believes that, subject to a reasonable allowance for doubtful accounts, if any, all assessments are collectible.
The Association maintains cash in bank deposit accounts that, at times, may exceed federally insured limits. The Association has not experienced any losses in such accounts. Property and equipment maintained in the operations of the Association are recorded at cost and depreciated using the straight-line method over estimated useful lives of 2 to 20 years. The Association's policy is to capitalize such items with a cost of $2,500 or more.
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