3 Basic Types of Community Associations - Planned Community - Owners owns his lot/living unit
and community owns common areas (tennis courts, basketball courts, etc.).
Condominium - Individual owns unit and undivided interest (percentage) in common elements.
Cooperative - Individual owns stock or membership in cooperative and holds a proprietary
lease/occupancy agreement.
3 components of Statement of Revenue and Expense - Revenue - Earning of community
Expense - Cost of goods/services used to operate/maintain community.
Net revenue (or loss)
3 Major Components of a Balance Sheet - Assets - Anything owned that has value.
Liabilities - What is owed to others or collected in advance.
Members equity - Difference between assets and liabilities.
4 Types of Insurance Coverage - PLIP
Personal
Liability
Income
Personnel
Accounting Methods - Cash Basis - Income received and expenses paid
Accrual Basis - Income earned and expense received
, Modified Cash Basis - Records income (assessments) on accrual basis and expenses on cash
basis
Alternative DIspute Resolution (ADR) - 3rd party resolution used before lawsuit/court
Articles of Incorporation - Brings corporation into existence.
Coops must incorporate because the the corporation owns all the property.
Other types of communities may incorporate.
Balance sheet - Snapshot of financial condition at a specific point in time. Lists what the
association owes and owns and its net worth.
Bankruptcy - Chapter 7 - Liquidation
Chapter 11 - Corporate
Chapter 13 - Personal reorganization
Benefits of incorporating - Limit liability of individual owners.
Right granted all corporations
Easier to deal with utility companies, vendors, etc.
Board Resolutions - A motion that follows a set format and formally adopted by the board.
Budget Line Items - Mandatory & Discretionary
Mandatory - Community and owner needs and obligations (maintenance, utilities, repairs,
taxes).
and community owns common areas (tennis courts, basketball courts, etc.).
Condominium - Individual owns unit and undivided interest (percentage) in common elements.
Cooperative - Individual owns stock or membership in cooperative and holds a proprietary
lease/occupancy agreement.
3 components of Statement of Revenue and Expense - Revenue - Earning of community
Expense - Cost of goods/services used to operate/maintain community.
Net revenue (or loss)
3 Major Components of a Balance Sheet - Assets - Anything owned that has value.
Liabilities - What is owed to others or collected in advance.
Members equity - Difference between assets and liabilities.
4 Types of Insurance Coverage - PLIP
Personal
Liability
Income
Personnel
Accounting Methods - Cash Basis - Income received and expenses paid
Accrual Basis - Income earned and expense received
, Modified Cash Basis - Records income (assessments) on accrual basis and expenses on cash
basis
Alternative DIspute Resolution (ADR) - 3rd party resolution used before lawsuit/court
Articles of Incorporation - Brings corporation into existence.
Coops must incorporate because the the corporation owns all the property.
Other types of communities may incorporate.
Balance sheet - Snapshot of financial condition at a specific point in time. Lists what the
association owes and owns and its net worth.
Bankruptcy - Chapter 7 - Liquidation
Chapter 11 - Corporate
Chapter 13 - Personal reorganization
Benefits of incorporating - Limit liability of individual owners.
Right granted all corporations
Easier to deal with utility companies, vendors, etc.
Board Resolutions - A motion that follows a set format and formally adopted by the board.
Budget Line Items - Mandatory & Discretionary
Mandatory - Community and owner needs and obligations (maintenance, utilities, repairs,
taxes).
