Similarly, if you only need to build a website for your HOA, you can focus on such a software package. Don’t worry; we’ll cover various software packages in each category later in this guide. For now, let’s discuss the different criteria you should consider when evaluating HOA software. The simplest answer is because it can take a lot of work off your plate, of course. So, below, we’ve listed other key benefits of implementing software solutions to help run your HOA.

Profit-oriented businesses only have one set of self-balancing accounts or general ledger. On the other hand, nonprofits can have more than one general ledger depending on their needs. Homeowners Associations must be able to produce reports that can detail expenditures and revenues for multiple funds, and reports that summarize the financial activities of the entire entity across all funds. For example, under California law, the Association’s Reserve Account must be a separate fund from the operating account. The Reserve Account is bound by specific legal restrictions that do not apply to the operating fund.

How Often to Prepare Financial Statements?

Large associations with many accounts or complex budgets often choose to prepare statements every year. Like our software, our bookkeeping service offers top-notch accounting security. We have been recognized with the highest level of Payment Card Industry Data Security Standard compliance for our practices, and we apply this same attention to detail to our HOA bookkeeping service.

HOA Accounting Service’s founder, Gary Satterfield has been an active member in the Common Interest Development Industry since August 2003. Gary has served several Homeowner Association Board member terms and is a past Board member of the Community Association Institute, Bay Area and Central California Chapter. Our staff members have excellent accounting and community association industry experience for delivering high quality service to your association. Click on the employee names shown on the Contact Us page to see more about their related work experience and education. HOA Accounting Services is a member and strong supporter of the Executive Council of Homeowners (ECHO) and Community Association Institute (CAI).

Website Builders and Website Management

For example, checks written near the end of August are deducted immediately on the company’s books, but those checks will likely clear the bank account in early September. Sometimes the bank decreases the company’s bank account without informing the company of the amount. For example, a bank service charge might be deducted on the bank statement on August 31, but the company will not learn of the amount until the company receives the bank statement in early September. From these two examples, you can understand why there will likely be a difference in the balance on the bank statement vs. the balance in the Cash account on the association’s books. It is also possible (perhaps likely) that neither balance is the true balance.

HOA Accounting Services has a professional, knowledgeable and friendly staff. They are patient in answering questions and providing insight on financial statements. All invoices are stored so one can check back payments and billing history. The HOA Portal makes it simple for homeowners to access documents and their payment history.

Tools and Solutions for HOA Board Members

From innocuous to blatantly egregious, we can catch accounting mistakes and correct them in real time. If there aren’t proper checks and balances in place, your association is at greater risk of fraud by board members, managers, and employees. However, the package is by far the most popular and effective accounting solution used by small to medium businesses worldwide. Next up we’ll mail out a letter to all your vendors to change their billing address so invoices come to us.

• As an HOA manager, PayHOA offers you an all-in-one software platform to replace all those fragmented tools so accounting, communications, payments, documents, violations, and owner requests can all live in one place.
• This includes maintenance costs, utility bills, and municipal fees.
• They will be able to see quickly if there are any discrepancies such as unfamiliar invoices, double charges, or suspicious activity.
• Trust can easily be broken between homeowners and the HOA if financial missteps occur.
• Since the nature of your association requires collecting regular fees from its members, the recurring invoice feature from FreshBooks allows you to plug in your members’ information once.
• When accounting for HOAs is overlooked, the association can risk being in poor fiscal health, which will impact operations.

Add every detail, no matter how small, so you have a more thorough insight and better decision-making. If you are having trouble preparing community financial statements, the professionals at CSM are standing by to answer all your questions. We have years of experience working with thousands of residents across the United hoa bookkeeping States. BoardSpace has been created with a single goal in mind – To give board members easy access to their association’s documents and records and meeting minutes and action items. With BoardSpace, you can find the documents you need instantly, keep track of what’s going on in your HOA, and get more done as a result.

How Can HOA Bookkeeping Services Help Your HOA’s Finances

Statements of income and expenses are an important association management tool. These reports show all of the association’s financial transactions for a given time period, usually on a monthly basis. You’ll be able to compare the HOA’s expenses and see if they are over or under budget for the month. However, because many HOAs lack accounting and financial expertise, dealing with bookkeeping tasks and obligations may be difficult.

Both balances may need adjustment in order to report the true amount of cash. Some associations will keep a few important expenses on an accrual basis (if they would otherwise skew the financial reporting), and the rest of the expenses on a cash basis. Typically, HOA accounting https://www.bookstime.com/ services may be kept on an accrual basis, since it is a large expense usually only incurred once a year. By accruing this entry, it allows the actual payments to be amortized over twelve months and make the comparison of the income statement to the budget more realistic.

Beginner’s Guide to HOA Finance, Budgeting, and Accounting

All your information is stored in the FreshBooks Cloud and protected by top-of-the-line security. This means you can access your company’s data from any device at any time. When you hear the word “audit,” most people immediately think of the IRS. But an audit isn’t always initiated because of taxes and it isn’t always a huge headache. In fact, an annual audit can ensure an HOA is in good financial standing for years to come. Some associations require an annual audit as part of their rules and regulations.

In a worst-case scenario, it can lead to inaccurate bookkeeping going unchecked. Looking for an out-of-house bookkeeper specializing in HOAs, particularly HOAs within your locality, can prevent these headache-inducing circumstances. Is a member and strong supporter of the Executive Council of Homeowners (ECHO) and Community Association Institute (CAI). As with most things regarding HOA financial statements, it depends on state laws and community bylaws. For starters, if there is consistent record keeping, association directors can look back on previous financial years to identify patterns that could affect the current budget and adjust accordingly. If detailed records are not kept, it can be near-impossible to keep track of delinquent dues or know how much money is available to budget for community maintenance and new projects.