Audit required vs financial review

Good day Group... Our HOA is located in Florida and per Statutes 720.303 Section 7 Financial Reporting-The association shall prepare an annual financial report within 60 days after the close of the fisal year.The association SHALL ,within the time limits set forth in subsection (5) ,provide each member with a copy of the annual financail report or a written notice that a copy of the financial report is available upon request at no charge to the member.Financial reports SHALL be prepared as follows:
( A ) An association that meets the criteria of this paragraph SHALL prepare or cause to be prepared a complete set of financial statements in accordance with generally accepted accounting principles.The financial statements shall be based upon the associations total annual revenues,as follows :

1- An association with total annual revenues of $100,000.00 or more ,but less than $200,000.00 SHALL prepare compiled financial statements.

2- $200,000.00 but less than $400,000.00 SHALL prepare reviewed financial statements.

3- $400,000.00 or more SHALL prepare AUDITED financial statements....Our HOA fits the description of #3..
At our last BOD Meeting a BOD Member made a motion to WAIVE THE AUDIT and it was seconded and passed .They then said the Members could request a review instead at our Annual Membership Meeting in January 2007.
Now my understanding is that based on the above Statute we are mandated to have an AUDIT....unless by Statute per Section 7 ( D ) If approved by a majority of the voting interests PRESENT at a properly called meeting of the association,an association may prepare or cause to be prepared :

1- A report of cash receipts and expenditures in lieu of a compiled,reviewed or audited financial statement;
2- A report of cash receipts and expenditures or a compiled financial statement in lieu of a reviewed or audited financial statement ;or
3- A report of cash receipts and expenditures,a compiled financial statement,or a reviewed financial statement in lieu of an audited financial statement.

Now what I need help on is FIRST- May a BOD make a motion to waive the mandatory audit?
Second-by voting members PRESENT -is this to imply NO PROXIES ALLOWED,you must physically be there at the meeting ?
Third- This statute has been in effect since 2004 in Florida and we have had only one mention of this at our last Annual Meeting in 2006 Jan.and we did not recieve any prior notification of this till the day of the voting and they lumped together 2004,2005,and 2006......They counted proxy votes and the vote to have an audit failed even thought the persons physically present for the meeting all raised their hands and said yes to having an audit..............I am need of input from the group as to if I am seeing soemthing wrong with all of this or am I over reacting??? I am not the only Member who feels that some hanky panky is going on.As always thanks for your wisdom and guidance in advance Linda C

1) Yes, the BOD can make a motion but it means nothing since their vote does not override the state statute.
2) No, when proxies are allowed those members are present by proxy and must be allowed to be represented in the voting.
3) The Board obviously was not aware of the statute until then so IMO they made a good choice by deciding to include all 3 years. The vote should have been counted by a talley committee at the meeting and they should have announce the results at the meeting. If there was a challenge it should have been resolved before the close of that meeting.

Was a financial review completed and the results presented to the association? I personally like that law. It protects the association and the MC and Treasurer who are handling the finances.

Thank you all for your replies...I will go back and search the forum for additional comments....I,for one do not have a problem as a Member paying for a "financial" check up. Our HOA in 33 years of existance has never had one,but our fees keep going and no true accounting to the Members...That has a few of concerned..Once again THANKS FOR YOUR HELP.....Linda C

I'm telling you all--- I am the newbie here-- Even though I built a home here in 1996 I never lived here till the past 16 months... Each piece of paper I discover leads me to another piece of paper and more questions....Of course the questions that I am asking are not answered or fluffed off as if it is none of my business...That's why I am running for a seat on the BOD.... They ( the manager) prepares a (cough cough ) financial review for the accountant to look at and they say YUP looks good... As far as reserves - well that's another story for another day.......As far as I and a few other members are concerned if it looks like shunk and smells like a skunk then it's a skunk....not a cow..........I have spent the past 6 weeks working to get my ducks in a row and haven't seen daylight yet due to the pile of paperwork,,,,, That's why the reason for my oringinal post..I am going to make sure these people out here understand the importance of having an audit.. Our BOD has known for 3 years that State Statute required it but fluffed it off,well not this year,,,,This bright eyed cookie is going to make it gets done........Our budget has $$$$ allocated for the financial review and if every lot here kicked in
$3.35 we could have a full fledged audit............. Like that other post said TRUST BUT VERIFY...So true indeed..........Thanks again for your support Linda C