CMCA FINAL TEST 2026 QUESTIONS
WITH CORRECT ANSWERS GRADED
A+
◍ community association.
Answer: a group of owners who wish to provide a communal basis for
preserving, maintaining, and enhancing their homes and property
◍ condominium.
Answer: a living unit fully owned by an individual with an undivided
interest in the common elements of the community; the community
association itself owns no real estate as an association
◍ cooperative.
Answer: wherein an individual owns stock or membership and holds a
proprietary lease or occupancy agreement for his or her living unit
◍ Declaration.
Answer: used interchangeably with CC & Rs
◍ Governing Documents.
Answer: documents which provide for the legal structure and operation of
the community
◍ indemnification.
Answer: to exempt an individual or entity from responsibility for claims
made against the organization and to reimburse the individual or entity for
damages or expenses incurred as a result of such claims
◍ mixed use development.
Answer: a development which is designed to mix two or more "uses" of land
together (i.e. a shopping center which offers office space for dentists)
,◍ planned community.
Answer: the most common type of community association, where an owner
owns his or her lot and/or living unit and the community owns any common
areas, such as tennis courts and roads for the use and benefit of the lot
owners
◍ proprietary lease.
Answer: a rental agreement between a cooperative housing corporation and
a shareholder allowing use of a certain unit in the premises
◍ public offering statement.
Answer: a disclosure statement prepared by a developer that contains all
material facts about a property offered for sale and that must be provided to
a prospective purchaser in accordance with applicable state or federal law
◍ resolution.
Answer: a motion that follows a set format and is formally adopted by the
board of directors
◍ statute.
Answer: a formal written enactment of a legislative authority that governs a
country, state, city or county
◍ umbrella association.
Answer: a cluster of community association types that can include aspects of
homeowners associations, condominiums and cooperatives
◍ ad hoc committee.
Answer: used when an objective needs consideration and no standing
organized group can absorb that issue into its scope; usually used on a
short-term basis, such as temporary oversight of an issue or review of the
standing rules of that community
◍ board liaison system.
Answer: directors are assigned to certain committees to guide the committee
on Board policy and procedures and to report back to the Board; directors
, serving must distinguish their role from the role of the committee
chairperson
◍ business judgement rule.
Answer: if a board has exercised reasonable decision making, the court will
generally not consider the board negligent in its fiduciary duty, nor will the
court substitute its judgment for that of the board; however, the board must
demonstrate how it has taken care in reaching a decision; it is up to the court
to decide if the board has been reasonable
◍ fiduciary duty.
Answer: requires directors to act in the best interests and for the benefit of
the corporation, thus the community as a whole; this has two components:
one, the members are required to avoid conflicts of interest and acting out of
self-interest; and two the members are also required to act as reasonable
people in managing the association's affairs
◍ management ethics.
Answer: the rules or standards that govern the conduct of members of a
profession; the assumption is that the special expertise held by members of
the profession holds them to a high standard of trust by others
◍ management audit.
Answer: a review of governing documents and existing policies and
procedures, current condition of the property, owner/resident satisfaction,
and fiscal operations; can be done by the board and manager together, or a
third-party management consultant
◍ management plan.
Answer: a statement of goals and objectives approved by the board
including the yearly cycle of tasks that should be performed on the
community association's behalf
◍ standing committee.
Answer: organized groups that have a continued existence and are not
related to the accomplishment of a specific, once-only task (e.g., budget and
, nomination committees)
◍ alternative dispute resolution.
Answer: mediation, arbitration and other ways of solving conflicts with the
help of a specially trained neutral third party without the need for a formal
trial or hearing
◍ default hearing.
Answer: held when the alleged violator fails to appear to scheduled meeting
◍ due process procedure.
Answer: a formal practice designed to protect the rights of all parties
involved
◍ hearing notice.
Answer: a written notice to an alleged violator that a meeting will be held to
consider his or her alleged violation
◍ hierarchy of authority.
Answer: rules and architectural guidelines may not contradict or be in
conflict with the legal sources that take precedence over them; although
rules and architectural guidelines are ranked lower in the for community
associations, they may clarify and expand a community's governing
documents—but may not conflict with the other governing documents
◍ rule.
Answer: a specific statement of required behavior whose violation carries a
penalty (sometimes called a sanction)
◍ assessment.
Answer: the owner's financial obligation to the community association
during a given period of time—usually one year
◍ baseline funding.
Answer: the goal of this strategy is to keep the reserve cash balance above
zero
◍ chart of accounts.
WITH CORRECT ANSWERS GRADED
A+
◍ community association.
Answer: a group of owners who wish to provide a communal basis for
preserving, maintaining, and enhancing their homes and property
◍ condominium.
Answer: a living unit fully owned by an individual with an undivided
interest in the common elements of the community; the community
association itself owns no real estate as an association
◍ cooperative.
Answer: wherein an individual owns stock or membership and holds a
proprietary lease or occupancy agreement for his or her living unit
◍ Declaration.
Answer: used interchangeably with CC & Rs
◍ Governing Documents.
Answer: documents which provide for the legal structure and operation of
the community
◍ indemnification.
Answer: to exempt an individual or entity from responsibility for claims
made against the organization and to reimburse the individual or entity for
damages or expenses incurred as a result of such claims
◍ mixed use development.
Answer: a development which is designed to mix two or more "uses" of land
together (i.e. a shopping center which offers office space for dentists)
,◍ planned community.
Answer: the most common type of community association, where an owner
owns his or her lot and/or living unit and the community owns any common
areas, such as tennis courts and roads for the use and benefit of the lot
owners
◍ proprietary lease.
Answer: a rental agreement between a cooperative housing corporation and
a shareholder allowing use of a certain unit in the premises
◍ public offering statement.
Answer: a disclosure statement prepared by a developer that contains all
material facts about a property offered for sale and that must be provided to
a prospective purchaser in accordance with applicable state or federal law
◍ resolution.
Answer: a motion that follows a set format and is formally adopted by the
board of directors
◍ statute.
Answer: a formal written enactment of a legislative authority that governs a
country, state, city or county
◍ umbrella association.
Answer: a cluster of community association types that can include aspects of
homeowners associations, condominiums and cooperatives
◍ ad hoc committee.
Answer: used when an objective needs consideration and no standing
organized group can absorb that issue into its scope; usually used on a
short-term basis, such as temporary oversight of an issue or review of the
standing rules of that community
◍ board liaison system.
Answer: directors are assigned to certain committees to guide the committee
on Board policy and procedures and to report back to the Board; directors
, serving must distinguish their role from the role of the committee
chairperson
◍ business judgement rule.
Answer: if a board has exercised reasonable decision making, the court will
generally not consider the board negligent in its fiduciary duty, nor will the
court substitute its judgment for that of the board; however, the board must
demonstrate how it has taken care in reaching a decision; it is up to the court
to decide if the board has been reasonable
◍ fiduciary duty.
Answer: requires directors to act in the best interests and for the benefit of
the corporation, thus the community as a whole; this has two components:
one, the members are required to avoid conflicts of interest and acting out of
self-interest; and two the members are also required to act as reasonable
people in managing the association's affairs
◍ management ethics.
Answer: the rules or standards that govern the conduct of members of a
profession; the assumption is that the special expertise held by members of
the profession holds them to a high standard of trust by others
◍ management audit.
Answer: a review of governing documents and existing policies and
procedures, current condition of the property, owner/resident satisfaction,
and fiscal operations; can be done by the board and manager together, or a
third-party management consultant
◍ management plan.
Answer: a statement of goals and objectives approved by the board
including the yearly cycle of tasks that should be performed on the
community association's behalf
◍ standing committee.
Answer: organized groups that have a continued existence and are not
related to the accomplishment of a specific, once-only task (e.g., budget and
, nomination committees)
◍ alternative dispute resolution.
Answer: mediation, arbitration and other ways of solving conflicts with the
help of a specially trained neutral third party without the need for a formal
trial or hearing
◍ default hearing.
Answer: held when the alleged violator fails to appear to scheduled meeting
◍ due process procedure.
Answer: a formal practice designed to protect the rights of all parties
involved
◍ hearing notice.
Answer: a written notice to an alleged violator that a meeting will be held to
consider his or her alleged violation
◍ hierarchy of authority.
Answer: rules and architectural guidelines may not contradict or be in
conflict with the legal sources that take precedence over them; although
rules and architectural guidelines are ranked lower in the for community
associations, they may clarify and expand a community's governing
documents—but may not conflict with the other governing documents
◍ rule.
Answer: a specific statement of required behavior whose violation carries a
penalty (sometimes called a sanction)
◍ assessment.
Answer: the owner's financial obligation to the community association
during a given period of time—usually one year
◍ baseline funding.
Answer: the goal of this strategy is to keep the reserve cash balance above
zero
◍ chart of accounts.
