What is Presentation of Accounts?
The presentation of accounts in the context of homeowner associations (HOAs) refers to the disclosure and explanation of all financial transactions that have occurred within the association during a specific period. This could include income from homeowner dues, expenditures on maintenance, upgrades, or services, and the current financial status of the association.
Importance of Presentation of Accounts
The presentation of accounts is a critical aspect of any HOA’s operation. It ensures transparency by making financial information accessible to all members. It also promotes accountability by providing an opportunity for the association’s leadership to clarify the use of funds and the association’s financial health. This practice not only keeps members informed but also contributes to building trust and confidence within the community.
Components of Presentation of Accounts
A complete presentation of accounts typically includes the statement of financial position (or balance sheet), statement of income and expenditure, notes to the accounts, and auditor’s report. These documents provide a comprehensive view of the HOA’s financial status and transactions. In some cases, the presentation may also include a budget forecast for the coming year or period.
Frequency of Presentation of Accounts
Most HOAs present their accounts annually, typically at the annual general meeting (AGM). However, the frequency may vary depending on the rules and regulations of the specific HOA. It’s important to note that regular and timely presentation of accounts is a best practice that every HOA should adhere to.
