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Dealing with D&O
Enforcing House Rules
Pool Closing
Snow - How to plan for the inevitable
What is a Management Company?
What Your Manager Should Know
Self-Management: Risky Scheme?
Why Bother to Budget?
Review Your Record Keeping
What Are You Getting for Your Management Dollars?
Article: Review Your Record Keeping
By: Alvin Wasserman
From Habitat Magazine
Alvin Wasserman is director of Fairfield Property Services in Commack, N.Y.
When a board visits the office of its management company, its members see first hand how their records are maintained. What should they look for when reviewing those records?
Be sure that property and vendor segregate accounts payable files. Individual unit files should include copies of all correspondence to the current owner, former owners, and any other relevant information pertaining to that unit. The files should be maintained in an orderly, protected environment. The condition of your property's records is easily determined by a visit to the management office.
Records are the property of a condominium, cooperative, or homeowner's association and are maintained by their property management company. Records provide historical data essential to property maintenance. They also provide a paper trail for work orders, legal matters, and correspondence between the board, management company, and unit-owners.
A management company needs accurate records to service a property. Upon transition from one management company to another, records must be turned over to a representative of the board. A management company has no right to retain a property's records in a transition, even if there is a dispute with the board. In fact, since the records are the property of the condominium, cooperative, or homeowners association, in theory the board can ask for their records at any time and the management company must comply. Managing a property without records would be extremely difficult.
One way boards can protect themselves is to keep a copy of every monthly report provided by the management company. If the management report is properly prepared, it will provide essential information regarding business transacted at the property over the prior month. A monthly report should be held together in a report folder and divided into tabbed sections; "Financial," "Legal," "Correspondence," "Miscellaneous," and "Response" (action items that require board decision). When properly prepared, the monthly report can easily be referenced if necessary. Additionally, boards should have a copy of every contract they sign. The reports and contracts should be secured in a file somewhere on the property, other than an individual's home.
File maintenance is labor-intensive and contributes to the cost of doing business for a management company. By reviewing their files, a board can ascertain if its management company respects the importance of file maintenance or is cutting corners.
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