“HOA Audit Can be Waived” – News-Press

“HOA Audit Can be Waived” – News-Press

Q: My homeowners’ association is required to have an audit every year. This year there is a discussion of skipping the audit. Are there voting guidelines and deadlines on this? (A.G., via e mail)

A: Section 720.303(7) of the Florida Homeowners’ Association Act provides that homeowners’ associations with annual revenues of $500,000.00 or more must prepare audited financial statements each year. Associations with total annual revenues of at least $300,000.00, but less than $500,000.00, must prepare reviewed financial statements. Associations with total annual revenues of $150,000.00 or more, but less than $300,000.00, must compare compiled financial statements, and associations with revenues of less than $150,000.00 must prepare a report of cash receipts and expenditures.

The statute states that the financial statements must be prepared within 90 days of the end of the fiscal year or by the date provided in the bylaws. Additionally, the association must provide a copy of the financial statements to the members within 21 days of completion of the financial statement or no later than 120 days from the end of the fiscal year.

The law goes on to stay that, if approved by a majority of the voting interests present at an association meeting, an association may prepare a “lower level” report, from the list above. The statute does not state that a deadline by which this vote must be taken.

By contrast, Section 718.111(3) of the Florida Condominium Act does establish a voting deadline. This law says that the membership must vote on reducing the statutorily required level of financial reporting prior to the end of the fiscal year in question.

Q: What notice to the members is required in advance of the board of directors adopting the annual budget? (M.K., via e-mail)

A: The Florida Condominium Act requires posted notice and mailed, hand delivered, or electronically transmitted (to those unit owners who consent in writing to receive electronic notice) notice, with a copy of the proposed budget at least 14 days prior to the board meeting at which the proposed budget will be considered. The condominium documents may impose additional requirements. The board of directors of a condominium association must adopt the annual budget at least 14 days prior to the start of the association’s fiscal year.

By comparison, board meetings for a homeowners’ association at which the proposed budget will be considered, requires only 48 hours posted notice or, in the alternative, notice may be mailed or delivered to each member at least 7 days prior to the board meeting. However, unlike the condominium law, a post meeting budget adoption notice has to be sent out. Like condominiums, the HOA governing documents can impose additional requirements.

Q: Is it correct that a condominium owner must submit his or her name into nomination for the board of directors at least 40 days in advance? (Z.G., via e-mail)

A: Yes.

Condominium board elections are strictly regulated by Section 718.112 of the Florida of the Condominium Act and Rule 61B-23.0021 of the Florida Administrative Code.

The Association must send out a “first notice” of the election at least 60 days in advance. All unit owners and other eligible persons wishing to be a candidate have up until 40 days before the election to self-nominate. Nominations close at the end of the 40th day.

All candidates can provide a “candidate information sheet” (resume or election platform) up to 35 days before the election. The association must then send out the election materials at least 14 days before the annual meeting.

The condominium documents can also impose additional requirements which should be reviewed and considered when planning for association meetings.

Joe Adams is an attorney with Becker & Poliakoff, P.A., Fort Myers. Send questions to Joe Adams by e-mail to jadams@beckerlawyers.com. Past editions may be viewed at floridacondohoalawblog.com.