Improve Your HOA Accounting
Improve your HOA Accounting and watch your board run the easy way. Times vary but HOA Boards and homeowners associations in Illinois hold votes on regarding vendors for the upcoming fiscal year. Fall typically the time of year when many HOA management contracts expire. At that time they are up for renewal. HOA property management contracts that are up for renewal. This is an excellent time to assess your management services. HOA Accounting is a key factor in decision-making. Transparency customer service and results of the past year’s or more services are under the spot light.
Unhappy HOA Board Members
We get emails and calls from HOA board members owners and even renters. These community residents are frustrated with the property management company. They usually discuss multiple negatives. They’ve possibly been with the same HOA management company for years. This board has watched their service steadily deteriorate. Over time it’s finally gotten to a boiling point. Now the board is ready to make a change.
The level of service you receive from your HOA management company is poor. The vast majority of Illinois community associations do not have a professional HOA Management company. Your association might be self-managed. This is the best opportunity to look at what you stand to gain by bringing on accounting services and a trusted community association accounting company.
If your board has been managing all vendors directing large projects and managing insurance issues of your community you stand to benefit by hiring an HOA Accounting-Only service provider. The automation reporting and transparency of your community’s budget and expenses is greatly enhanced by using our HOA Accounting Services.
Switching HOA Management to Accounting-Only Services
Perhaps one of the greatest and most obvious advantages of hiring a professional HOA Accounting firm is access to the wealth of knowledge and experience we offer. Experienced property accountants will guide a board of directors through our decision-making process and help to make sound business decisions.
What is the level of experience within your HOA Board leadership? You may have experienced homeowners on your board. If your board has little experience you will want to consider the benefits that an experienced HOA Accounting firm brings to the table.
HOA Accounting Services
Our HOA accounting company is a big help when it comes to association financials. Budgeting collecting dues and working with collections agencies are all part of the best accounting process.
Our HOA accounting company collects funds. When a homeowner is delinquent on dues. We work with the board to create a policy on collecting late assessments. Liens and foreclosures often require working with banks and attorneys. Another job best left for the accounting company. Collections are necessary and if left unmanaged will bring the community and property values down faster than you would expect. We will help you avoid crisis by staying on top of financials which are in the negative.
Is your current HOA management company adept at association financials? Are their reports accurate and easy to read? If not consider changing. Lack of transparency and foggy tracking of your accounts lead to big community board problems.
If your association is self-managed listen closely. You will want to assess its financials accounting in the same way.
HOA Dues and Late Fees
Are dues and late fee billing administered correctly? Is your association allocating adequate funds in reserves? A quality HOA accounting firm will work with reserve specialists and committee members to determine an adequate amount of reserve funding.
Without preparation what will your association do when it’s time for the major repair. Replacement such as re-paving the roads or replacing roofs?
Staying on top of maintenance billing is a must when managing a planned community. This can prove difficult for larger communities or those with substantial common property. How are maintenance billing issues handled at your community? Are work orders paid in a timely manner or does it take weeks to complete even the most basic billing? On-time and accurate billing will include paying your landscapers insurance companies general contractors and maintenance companies in a timely fashion. Paying these vendors means that you don’t have to take a chance on hiring a new vendor that may not be able to deliver. We keep your vendors paid on time.
Signs It Is Time to Change to HOA Accounting
There are several significant issues that HOA board members usually encounter when dealing with a sub-par HOA management company and the accounting.
Poor communication is one factor that weakens the relationship between an HOA and their management company. We hear from HOAs all the time who say their community manager or accounting fails to return their phone calls or reply to their emails quickly. They leave a message for the community manager but it takes several days for them to respond. Sometimes they do not respond at all. Your community’s homeowners and vendors have the same experience. When it comes to the management of a homeowner’s association accounting communication is key. A quality HOA Accounting company will always strive to keep an open line of communication with its clients and vendors.
HOA community manager fail to complete project vendor payments. The board has asked for a electrical company to be paid a plumber to be paid or a new landscaper. It seems the community manager is continually putting off processing paperwork. The board ends up feeling stuck as they repeatedly bring up these concerns without making any progress. Vendors can be lost and community services drop off because of slow payments.
We also often hear from board members that can’t access the HOA’s financial reports online or on demand. We hear from boards that are getting incomplete financial documents; some boards request these reports and never receive them. Many times they arrive incomplete or are so difficult to read they are worthless. Lack of reporting organization leads to major troubles and greater lack of transparency to your community financials.
Consistent Account Managers
Besides the difficulties outlined above one of the most frequent complaints we get from HOA board clients who call our office looking for a bill is that they had a great accounting manager. But then their management company gives them a new person. Then another person and the current community accounting isn’t measuring up.
HOA Accounting managers can make or break your HOA. Accounting company should mean a relationship. Experienced accountants separate good companies from the less-than-stellar ones. They can make a board member’s experience positive or negative. They are the reason you love the company you are with. Maybe you are barely tolerating them or can’t wait to switch. Because of this there are several important differences between great community accounting service and mediocre at best.
Responsiveness is a key characteristic to look for in your HOA accounting manager. First-rate community accounting managers know that customer service largely comes down to responsiveness. They return emails immediately. They answer their phone and/or return phone calls. Accounting managers want to get people the answers they need.
A great community accounting manager also cares about their communities. They want their communities to run well be safe and for homeowners board members and vendors to all have good relationships with each other. They get upset by the same things that upset board members or homeowners.
Your community accounting manager should defuse situations instead of escalating them. Ideally they go into a situation trying to defuse any tension. Anger or frustration that might exist is dealt with. They know how to put people at ease and help them realize that their HOA or HOA accounting company isn’t out to get them. Striving to help the HAO board lead their community in a way that creates trust confidence and goodwill with homeowners is their number one goal. They never foster a non-adversarial relationship.
Training also factors into the effectiveness of your community manager. Excellent community accountants can answer common questions from homeowners or board members. They aren’t novices. Our community accounting managers have studied local laws the changes and have experience under their belt. No one knows all the answers. A good community accountant knows where to go and who to ask to get you your answers.
Your community accountant works full-time. Some HOA accounting companies use part-time employees as managers. A part-time schedule doesn’t provide enough time for the accountant manager and HOA board to accomplish necessary tasks efficiently.
Finally your community accountant should enjoy their job. Great community accountants work for great companies. They quit from companies that overload them and have an unhealthy work environment. If you know of several community accountants who have left your current company it’s likely that the employees aren’t to blame.
Terminating Your Current HOA Management Contract
You may be on the Board of Directors for your homeowners association?
Is your HOA currently managed by a professional HOA company?
If you answered yes these questions then you should have a copy of your current management agreement between the association and your HOA management company. This contract holds vital information necessary for properly managing your homeowners association. The most important part of this contract includes how to terminate the contract.
As the end of the year approaches many HOA management contracts expire and/or come up for renewal. Don’t miss this opportunity to make a needed change in your accounting! Request a copy of your management contract and carefully review it with members of your Board of Directors. In order to explore what your options are when it comes to terminating your management agreement and changing to HOA accounting as your solution.
It’s important to take the length of the contract into consideration. Determine how long the contract lasts. Is it one year two years or three years? If the contract automatically renews this is called “keystone”. What are the time periods that this automatically renews for?
If your HOA wishes to terminate the contract with their current company you’ll need to find out what stipulations exist for being released from the contract. Will you have to give a 30 day notice 60 day notice or 90 day notice? Do you need to give notice 30 days before the effective date? If so it’s important for all board members to be aware of the effective date of the contract. We will assist to put the correct strategy in place to avoid wasteful penalties.
Furthermore does your notice have to be given by regular mail or certified mail? Again we can help make sure you get there.
You’ll also want to establish whether there are any termination penalties involved with being released from the contract early. Will remaining management fees need to be paid out in the case of early termination? It is many times worth it to get away from the mistakes of bad accounting.
Knowing the exact language in your HOA management contract will help your board members make better decisions regarding their association. Consult with your HOA management company or your HOA attorney for more helpful tips on reviewing your HOA management contract.
Spot key differences between high-quality and low-quality community managers quickly. Our HOA accounting company will help you. Your HOA will make the right choice for your community’s needs with sound advice and solutions. Whether that decision involves keeping your current HOA management company or changing to our HOA Accounting Services as your solution.