CMCA UPDATED 2026 TEST PAPER QUESTIONS AND
SOLUTIONS GRADED A+
✔✔Compilation - ✔✔A presentation of financial statements by a CPA without the
assurance that information conforms to GAAP.
✔✔Management Letter - ✔✔A separate report that often accompanies the audit or
review. This is a separate narrative (descriptive) report discussing the community
association's accounting system and controls any weaknesses found in them during the
audit plus any other comments on the association's finances.
✔✔Opinion Letter - ✔✔
✔✔Investments - ✔✔Involve the purchase of anything with money value for the purpose
of generating additional money over time, such as savings account.
✔✔The three essential investment objectives for community associations in the order of
their importance to a community association area? - ✔✔Safety, Liquidity, and Yield
✔✔Safety - ✔✔For community association investments consist of protecting the
principle (amount of original investment) from loss.
✔✔Treasury Bills - ✔✔Short-term instruments that mature in 13, 26, or 52 week
periods. They are issued in minimum denominations of $10,000. Anything larger must
be in $5,000 increments. As soon as one is purchased, the buyer receives the promised
earnings. Then, when it matures, the buyer receives the face value (value indicated in
the wording of this).
✔✔Treasury Bonds - ✔✔Treasury notes mature in one to ten years. This matures in
more than 10 years. Both notes and bonds are issued in denominations from $1,000 to
$10,000. They are also interest-bearing with interest paid every six months. When the
note or none matures, the buyer receives the full face value.
✔✔Liquidity - ✔✔Refers to the ease with which an investment can be converted into
cash or a cash equivalent.
✔✔Yield - ✔✔Is the amount of return on an investment. The ultimate earnings from an
investment are not necessarily the stated rate of interest.
✔✔Facilities Management - ✔✔Is the process of operating, maintaining, repairing, and
replacing common property - that is, the common elements or areas.
✔✔Management Tool - ✔✔Is any means used to track, record, remind, or common
attention. Usually these means are forms or documents. Examples include: checklists,
, charts of information, calendars or schedules, records of actions taken, inventories,
computer generated work orders, request forms, and response forms.
✔✔Responsibility Chart - ✔✔A management control you can use to keep track of who is
responsible for the maintenance of various property elements or areas.
✔✔Maintenance Contact Sheet - ✔✔A useful management control to record various
maintenance services and information needed in case of an emergency.
✔✔Routine Maintenance - ✔✔This is the regular, recurring upkeep that must be done
(for example - cleaning, cutting grass). Typically, the job description for a maintenance
employee or a service contract is used to define what is expected.
✔✔Preventive Maintenance - ✔✔This is periodic maintenance to avoid disruptive
breakdowns and to prolong the useful life of the physical asset in questions. (Examples
include rebuilding pool pumps with a life expectancy of eight years every five years, and
cleaning problem sewer lines ever month to avoid backups).
✔✔Emergency Services Maintenance - ✔✔This is the ability to respond to
unpredictable problems (for example - sewer backups, elevator failures, roof leaks,
frozen pipes, etc.).
✔✔Requested Maintenance - ✔✔This is maintenance requested by an owner, a tenant,
or the board, or recommended by a contractor, or identified during a routine site visit of
the property (for example - a pothole in the street).
✔✔Reserve Replacement - ✔✔This consists of replacing physical assets as they wear
out or break.
✔✔Maintenance Calendar - ✔✔This is a calendar or schedule that identifies what
needs to be done during the year, and how frequently.
✔✔Maintenance Record - ✔✔While the calendar tells you when maintenance ought the
be done, the record tells when it actually was done.
✔✔Site Visit Checklist - ✔✔Documents your current maintenance standards and helps
you identify potential problems.
✔✔Site Visit Report - ✔✔Is a compilation of all the maintenance needs identified during
a site visit. Use it to: assign maintenance tasks to your staff or contractors, budget for
maintenance needs, identify any preventive maintenance that needs to be done,
determine when on-site staff or independent contractors are not properly performing
work on time, and demonstrate to the board that you are visiting the property and
copying with contractual obligations.
SOLUTIONS GRADED A+
✔✔Compilation - ✔✔A presentation of financial statements by a CPA without the
assurance that information conforms to GAAP.
✔✔Management Letter - ✔✔A separate report that often accompanies the audit or
review. This is a separate narrative (descriptive) report discussing the community
association's accounting system and controls any weaknesses found in them during the
audit plus any other comments on the association's finances.
✔✔Opinion Letter - ✔✔
✔✔Investments - ✔✔Involve the purchase of anything with money value for the purpose
of generating additional money over time, such as savings account.
✔✔The three essential investment objectives for community associations in the order of
their importance to a community association area? - ✔✔Safety, Liquidity, and Yield
✔✔Safety - ✔✔For community association investments consist of protecting the
principle (amount of original investment) from loss.
✔✔Treasury Bills - ✔✔Short-term instruments that mature in 13, 26, or 52 week
periods. They are issued in minimum denominations of $10,000. Anything larger must
be in $5,000 increments. As soon as one is purchased, the buyer receives the promised
earnings. Then, when it matures, the buyer receives the face value (value indicated in
the wording of this).
✔✔Treasury Bonds - ✔✔Treasury notes mature in one to ten years. This matures in
more than 10 years. Both notes and bonds are issued in denominations from $1,000 to
$10,000. They are also interest-bearing with interest paid every six months. When the
note or none matures, the buyer receives the full face value.
✔✔Liquidity - ✔✔Refers to the ease with which an investment can be converted into
cash or a cash equivalent.
✔✔Yield - ✔✔Is the amount of return on an investment. The ultimate earnings from an
investment are not necessarily the stated rate of interest.
✔✔Facilities Management - ✔✔Is the process of operating, maintaining, repairing, and
replacing common property - that is, the common elements or areas.
✔✔Management Tool - ✔✔Is any means used to track, record, remind, or common
attention. Usually these means are forms or documents. Examples include: checklists,
, charts of information, calendars or schedules, records of actions taken, inventories,
computer generated work orders, request forms, and response forms.
✔✔Responsibility Chart - ✔✔A management control you can use to keep track of who is
responsible for the maintenance of various property elements or areas.
✔✔Maintenance Contact Sheet - ✔✔A useful management control to record various
maintenance services and information needed in case of an emergency.
✔✔Routine Maintenance - ✔✔This is the regular, recurring upkeep that must be done
(for example - cleaning, cutting grass). Typically, the job description for a maintenance
employee or a service contract is used to define what is expected.
✔✔Preventive Maintenance - ✔✔This is periodic maintenance to avoid disruptive
breakdowns and to prolong the useful life of the physical asset in questions. (Examples
include rebuilding pool pumps with a life expectancy of eight years every five years, and
cleaning problem sewer lines ever month to avoid backups).
✔✔Emergency Services Maintenance - ✔✔This is the ability to respond to
unpredictable problems (for example - sewer backups, elevator failures, roof leaks,
frozen pipes, etc.).
✔✔Requested Maintenance - ✔✔This is maintenance requested by an owner, a tenant,
or the board, or recommended by a contractor, or identified during a routine site visit of
the property (for example - a pothole in the street).
✔✔Reserve Replacement - ✔✔This consists of replacing physical assets as they wear
out or break.
✔✔Maintenance Calendar - ✔✔This is a calendar or schedule that identifies what
needs to be done during the year, and how frequently.
✔✔Maintenance Record - ✔✔While the calendar tells you when maintenance ought the
be done, the record tells when it actually was done.
✔✔Site Visit Checklist - ✔✔Documents your current maintenance standards and helps
you identify potential problems.
✔✔Site Visit Report - ✔✔Is a compilation of all the maintenance needs identified during
a site visit. Use it to: assign maintenance tasks to your staff or contractors, budget for
maintenance needs, identify any preventive maintenance that needs to be done,
determine when on-site staff or independent contractors are not properly performing
work on time, and demonstrate to the board that you are visiting the property and
copying with contractual obligations.
