Treasurer's reports

I recently discpvered irregularities in our annual treasurer's reports. Not all expenses are being correctly reported.They are understated and overages debited to other accounts.I am also concerned the annual assessments are not being correctly reported, At the end of each fiscal year there are prepaid assessents and delinquencies. Yet, the annual income is reported as the exact amount due annually, to the dollar. Perhaps I'm wrong, but I don't understand how this is possible.
We have a paid bookkeeper-treasurerwho does our books. The elected treasurer does little other than advise this hired help. Since the board hired this bookkeeper treasurer there has not been an audit of the books and this is at least 12 years ago.
I am a newly elected board member, but served on this board for 15 years in the past. In the past there were annual audits of the books, as our by-laws require, but stopped when the bookkeeper-treasurer was hired.Unfortunately, aftr seving on the board for 15 years , I was was tired and paid little attention to the association.
I notified the board of my concerns, but they have not responed to my questions or even acknowledged them.We will be having a board meeting on August 11th. and I know I'm in for a rough time.Other than requesting an audit of the books, which they will refuse to undertake., what can I do to correct these errors.I did suggest a management company be hired to replace the bookkeeper treasurer at a cost of about $45.00 more than we are paying for just minimal bookkeeping service, but they refused to consider, in spite of all the advantages this would provide to the board and homeowners.
Is there anything illegal about improper reporting of income and expenses? I do not suspect theftis involved , only a serious lack of understanding the duties and responsibilities involed
serving on the board.

Help!!!

Marie,

Your board needs to replace the bookkeeper ASAP, it's very apparent she/he does not know what she/he is doing. You don't just "plug" in figures on the financial statement, the figures are taken right from the general ledger accounts. There is no way the general ledger can be in balance if there are delinquent assessments, prepaid assessments and the assessment income total is the same as the $$ due for the year (as shown on the budget, I presume). Also if the treasurer is advising the bookkeeper perhaps she/he should not hold this position on the board either! I would also suggest having an audit performed since one has not been performed since this person was hired. I wonder what the qualifications of this paid bookkeeper are!

You asked if there is anything illegal about improper reporting of income and expenses. I would say only if embezzlement is occuring. Otherwise it just means the bookkeeper or treasurer just doesn't know how to perform his/her job. This is very common when a member serves as treasurer but doesn't know anything about accounting, much less bookkeeping. However this is a paid bookkeeper who should know what he/she is doing. There must be other clients this bookkeeper is doing work for. . .

You need to make these board members see the light!!!

Marie,

Unless your investments generate more than $100 in interest for the year there is no need for tax-free investments. But, it's almost impossible to obtain a good interest rate at this point in time. I would not recommend an HOA investing in anything other than money market accounts or CDs. Other types of investments that will earn more interest can be risky and an HOA should not be invested in anything risky.

But, getting back to the bookkeeper and treasurer. It's really sad that your BOD cannot see how these people are of no use to the assn; in fact the bookkeeper is downright dangerous. Perhaps you can get some of your friends and neighbors together and you can call for a recall election. Or if that isn't plausible, try to get some people interested in running for the BOD. Your BOD certainly needs some new blood. Maybe your hiatus is over!!! LOL

Marie,

I am familiar with Fidelity Investments; they have all kinds of accounts to invest in. It would be good to know exactly what type of account Fidelity is holding for your assn. If it's a mutual fund it could be a risky venture. But if it's a money market account or a CD that would be OK. Of course if the BOD doesn't care that puts a different light on the picture. But, I'll bet they would change their tune if the $31,000 all of a sudden was down to $20,000!