Repairs funded from Capital Reserves?

This is an accounting question: The Board agreed to repair the interior of a condo and pay for the expenses. Are there rules how the expenses should be funded? from capital reserves or from the operating budget?

Alex,

The Board can "borrow" from the reserves to pay for something the operating budget should pay for. However prior to borrowing, they must have a plan in place on how to repay what was borrowed from the Reserves.

Why would the board agree to pay for anything other than common property? I could understand it if it's a liability issue, but then, doesn't the association have liability and property damage insurance for such situations? If so, then the association should only have to pay any required deductible.

As for whether the money should come from reserves or the operating budget, you haven't supplied enough information for me to make any determination. Also, as some have said, it is possible to borrow from reserves in some cases.

I belong to a florida HOA and the BOD put a line item on the budget under revenues or income called Aministration Income, this year in the amount of $18,000. All the maintence fees income and sewer fee income, interest income and any other income fees are listed. I asked them what is Administration income? There is no such thing. The bookkeeepers says she takes it out of the sewer checking account and puts it into the general fund. If all the money coming in as sewer fees is accounted for and spent how can it be from sewer fees? My conclusion is it is from the reserve fund without voter approval. The BOD does a lot of creative budget antics. They have differed the Reserve Fund for the last 15 years illegally. They are putting Our HOA is real danger of all members having to come up with a huge assesment in the near future. I am working on trying to get them to see the error of their ways but it isn't easy. This is just the tip of the iceburg. They change by-laws illegally make deed restrictions illegally. I have only been an owner the last two years and can't believe the other owners have let them get away with this. But it isn't an easy job to change things so I can see how it can happen.