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Volunteer Treasurer for 140 member HOA?

Started by JimG • 10 replies • 2561 views

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JimG (Washington)
Posts: 5
Posted:
I have been the Treasurer (unpaid) for my HOA in Washington State for 6 years. When I took it over, everything was in an Excel spreadsheet and on paper. I had it all converted into Quickbooks Professional and now everything is safe and the info easily reported on. I feel it is time for an association of this size (we have a beach common area with Shelter, pier, playground, etc and several miles of private roads to maintain) to have a paid Treasurer or Property Manager assume the Treasurer's duties. Our dues are only $200/year and to cover the Property Manager we have a bid that would necessitate an increase to our dues of another $100/year per member for a total of $300/year per member.

I am curious if there are any HOA's of this size or bigger that still have an unpaid volunteer Treasurer. Does anyone think it wise to continue to have this position filled by an unpaid member/volunteer? Thank you. -Jim
RogerB (Colorado)
Posts: 5,067
Posted:
Jim, I commend you for your major contribution to your HOA! I is amazing when one continues to be the Treasurer for six years!! Some Board members may not realize the duties of a Treasurer who does all of the accounting may be more time consuming than the total of all three of the other Board's officers.

I think it is fine to have an unpaid volunteer be the Treasurer so long as there is a competent volunteer willing to do the job. How an HOA choses to delegate the accounting duties can vary greatly. For example, we do all PM duties an HOA with only 22 owners compared to another HOA we manage with 531 members where the Treasurer does all the accounting duties because their income is limited.

When the same members doing all the work they will get burned out. If that happens they often consider hiring a property manager.

MelissaP1 (Alabama)
Posts: 13,836
Posted:
BOD members are 99% NON-Paid VOLUNTEERS including the elected Treasurer. I never got paid a President nor did my board members. Now there are some HOA's that do pay their BOD but that's a different animal.

A bookkeeper CAN be HIRED by a HOA to handle their bills. We had one that was a member of our HOA but wasn't a board member. It was the owner of the Bookkeeping office that was the member of the HOA but had a staff member be assigned to our account. They had no control over decisions made by the board. They just handled the books and issued checks for us.

Don't worry, your not the ONLY person that does a BOD job for Free! There's many more on here that do. Your not alone!
Former HOA President
BradP (Kansas)
Posts: 2,640
Posted:
Jim, our HOA is 167 homes and our treasurer is volunteer.
PaulM (Pennsylvania)
Posts: 1,347
Posted:
JimG:
Rather than putting emphasis on a paid/unpaid Treasurer, I question the bid of a Property Mgr. which would necessitate an increase to your dues of another $100/yr. per member--that's $140,000 per yr. for a Prop.Mgr. to manage 140 units. Seems exhorbitant!

I caution you to not allow the Prop. Mgr. to assume the Treasurer's duties. There are many posts on this forum of those who have allowed the Prop.Mgr. access/ability to sign checks, etc. who now find themselves in trouble!

If your official docs state there is to be a Treasurer on the Exec. Board, then that is what your assn. needs to have. Most all Community Board positions are unpaid positions, and totally volunteer.
CharlesM2 (Massachusetts)
Posts: 16
Posted:
Here's my take on this.

Treasurer: The treasurer is responsible for the financial aspects of the association. I think of this as reviewing financial statements, reviewing bank reconciliations, signs checks, coordinates audits, coordinates reserve calculations, coordinates filing taxes, maintaining accounting records and files, etc.

Bookkeeper: Bookkeeping is another function altogether which includes posting assessments, generating statements, receiving payments, making deposits, preparing checks, paying invoices, maintaining accounting records and files, etc.

Almost all boards are 100% volunteer. Which includes the Treasurer. But the bookkeeping can be outsourced to a property manager or an accountant or a bookkeeping service.

I am the treasurer for our 74 home HOA. I'm also the bookkeeper. I am a volunteer for both. The other board members want to pay me because the treasurer and bookkeeper are time consuming positions. They wanted to pay me what they paid an external bookkeeper prior to me joining the board. But it is a conflict of interest to be paid.

If you want to be paid, you are best to resign from the board and then charge for your bookkeeping services. I know this sounds counterproductive for the board, but it's the best way to maintain a proper relationship with the board and the homeowner's association.

So in conclusion, the treasurer responsibilities should ALWAYS be performed by a member of the board. The bookkeeping responsibilities can be outsourced providing that there are sufficient budgeted funds for this activity.

I hope this helps.
RogerB (Colorado)
Posts: 5,067
Posted:
Paul, you missed the decimal point - it is $14,000 not $140,000. This is still high for a full services MC if it is for single family homes on individual lots.

When a MC is used they normally do all of accounting and booking. However we are different than most MCs because we will not be a signer on any bank account. We recommend never allowing a MC to sign checks.

Also, based on my many years serving on all officer's positions on Boards, ALL (not most) are unpaid volunteers. But they are reimbursed for out-of-pocket expenses.
PaulM (Pennsylvania)
Posts: 1,347
Posted:
RogerB: My math skills are lacking; thanks for pointing that out!
I appreciate your professionalism when you state that you, as an MC, will not be a signer on any bank account. Rightfully, so! Apparently, there are those MCs who think otherwise!
JudithC (Virginia)
Posts: 253
Posted:
Our association is 195 members and we have a volunteer treasurer and bookkeeper. Normally assessments are handled by a separate person and the after logging in, passed to the bookkeeper.

All of the cases of malfeasance I have seen have been with outside accountants or PMs. I am sure there must be some that occur, but I have not heard of a volunteer treasurer embezzling, has anyone else? I figure it is because you need a bigger pot to make it worthwhile. Anyhow, it is because of this I would be wary of changing. Of course it all boils down to if you have the volunteers, pre usual.
NancyD1 (Florida)
Posts: 447
Posted:
Quote:
Posted By JudithC on 08/13/2007 1:11 PM
Our association is 195 members and we have a volunteer treasurer and bookkeeper. Normally assessments are handled by a separate person and the after logging in, passed to the bookkeeper.

All of the cases of malfeasance I have seen have been with outside accountants or PMs. I am sure there must be some that occur, but I have not heard of a volunteer treasurer embezzling, has anyone else? I figure it is because you need a bigger pot to make it worthwhile. Anyhow, it is because of this I would be wary of changing. Of course it all boils down to if you have the volunteers, pre usual.

Judith, I know of a HOA in Boca Raton, FL, that had a new BOD installed in Jan 2007. The President & Treasurer, working together, stole over $500,000. in a 6 year period. The President had a gambling problem. They are under indictment, soon for trial.

Our HOA has 389 homes. The BOD members are all volunteers. I am the Treasurer and put in approx. 20-30 hours a week. The bookkeeper and PM sign off on all invoices. We do not pull checks for these invoices until I review them.

Whether you have insurance of not, never have a MC, PM or bookkeeper as a signor on an account.
DonN (Michigan)
Posts: 357
Posted:
JimG

Some definitions might help. The M-W online dictionary defines treasurer as "an officer entrusted with the receipt, care, and disbursement of funds". This is a limited responsibility and does not include an accounting responsibility. However, the governing documents for your association may include the accounting responsibility as one of the duties of the treasurer. However, such a duty in the governing documents may be inconsistent with the capabilities of volunteer board members.

I believe it is much better to have a separate person or entity perform the accounting function and provide periodic reports to the board and members conforming to the AICPA Audit and Accounting Guide for Common Interest Realty Associations. This can help ensure that the accounting is correctly done and kept current. It also helps maintain the credibility with members that the accounting is being done correctly. The treasurer, of course, would be responsible for the receipt and disbursement of funds.

Good governance costs money. Money spent for independent accounting is money well spent.

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