Requesting Copies of Financials

Started by ReneeD • 7 replies • 4604 views

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ReneeD (Illinois)
Posts: 201

Posted:

Recently, I requested copies of our financials and, with the exception of the delinquency report which is the only confidential/proprietary report I knew I wouldn't get, I only received the Income & Expense Statement and Balance Sheet. Would our BOD and property management firm have the right to refrain from divulging entire financial report to a homeowner? I know there is more to these reports; as a former Board Member in capacity of Treasurer I know what reports were generated each month and copies given to Board Members and, that what I received is not the entire "package" which consists in addition to Income & Expense and Balance Sheet the Check Register, Reserves Summary Overview & Reconciliation Statement, Balance Sheet and Delinquency Report.

Having surfed other associations' websites I see they are posting their financials information. Is anyone familiar with Illinois HOAs and requested financial information on their Association? What exactly are homeowners allowed to see?

Thanks! -renee

LisaS (Illinois)
Posts: 341

Posted:

I am a VP in an Illinois HOA, and we are quite open in what we provide. We post ALL of our financials on our website in their entirety.
If you requested in writing to review the records of the association and stated your purpose, they are required to show you everything except the confidential portions (i.e. litigation in process, employee files). If you make the request to review the files, the Board must comply within 30 days and show you ALL of the files and/or info you requested. You are allowed to make copies (or they can if they choose) of anything contained for a reasonable cost (to cover copying). There are legal ramifications for non-compliance.

If you are not familiar with it, review the State of Illinois Condominium Association Law available on the States web site. It is fairly easy to read, and will answer all your questions as to your rights. It applies to community associations (HOA's) as well as Condos. The name is a little misleading.

In your shoes, I too would wonder what was being hidden by not disclosing everything.

Best of Luck,
Lisa

ReneeD (Illinois)
Posts: 201

Posted:

Thank you, Lisa. This is good to know and will look for their website. While on the same subject, do you know the "pecking order" of these documents? I've been told there is another called Illinois Not For Profit Act. So, not only does a HOA have their own CCR's but also the Illinois Condominium and Not for Profit Act? The association's attorney has been instructed to represent only the BOD and Management Company so I have received no answers from either him or BOD on this subject. And, because we have a Management Company that pretty much runs the day-to-day operation of our association they have assumed a very dictatorial attitude, IMO, of what information a homeowner will receive; regardless, a homeowner can request information, if Board approved FIRST and still the Management Company sends what they deem relevant and then wanted to charge me $50 in addition to copying costs pretty much $1 per page. IMO, this is highway robbery! By the way, this 30 day compliance is being violated because our BOD meets every other month so, by the time a homeowner receives whatever information is being requested, 2 if not 3 months have gone by!

LisaS (Illinois)
Posts: 341

Posted:

Your association is only covered by the Illinois Not-for-Profit Act if they are a registered Not For Profit Corporation. I don't recall the web address, but if you Google it then you can find the Illinois registry for the non-profit and not for profits and see of your association is on it.

Interesting wrinkle...we now have an attorney who has been elected to our BOD. He works with liability professionally, so he wanted to know what ours/his was as he has never been on a Board. He has done a little reserach and called a few local 'experts' regarding exactly what rules our Not for Profit , non-PUD association has to follow. We found out that if you are a Community Association, but not a PUD, and have maintained your not for profit status then the State of Illinois Condo Law is not enforceable in action against your association!! I found this hard to swallow even though he is a pro, so he is going to do more checking and get it in writing.

I agree- what you are being charged to access records is highway robbery. Sounds questionable as to whether it is legal. Additionally, if you are an association member you are entitled to a full accounting of the financials. I agree that the BOD should receive the request and give it to the mgmt company. But they should not be able to alter the request or redact the info. I have not ever had to use Consumer help in this particular area, but I am sure Lisa Madigan's office or HUD could point you in a direction.
Good luck!
Lisa

ReneeD (Illinois)
Posts: 201

Posted:

Thanks for responding so quickly, Lisa....sounds like I've got my work cut out for me. So far, in all the reading I've been doing lately I have found no reference being a PUD--so, if we were it should be stated so in our Decs/ByLaws? If it isn't then I am assuming we too are a Not for Profit, non-PUD association. I will need to re-read our CCRs more closely.
Interestingly when this subdivision first came into existence one of the homeowners who moved in here also owns a management company and had (I'm sure still does) very close ties with certain village trustees, mayor, contractors, etc, but especially around turnover. Long and short of it is, homeowner became chummy with developer and ultimately was "hand-picked" to be on Board at turnover by probably convincing other homeowners(then)this was the right thing to do; ultimately, this homeowner resigned because they sold their unit but they still manage our property to this day---there are days I think this mgmt co thinks it "owns" this place still and has the BOD wrapped around its fingers anyway. This homeowner/mgmt co owner always referred to this complex as a PUD. How exactly does it have any relevance to a community? And, how exactly does that dictate what a homeowner can improve on their unit from the outside? We are a fee-simple, townhome community.

BethK (Illinois)
Posts: 3

Posted:

Hi, hi! We're having our share of financial issues, too. My neighbor has researched this and found the:

ILLINOIS CONDOMINIUM PROPERTY ACT
765 ILCS 605/1
As Effective JANUARY 1, 2004

On page 41 of the ACT it describes:

(9) the books and records of account for the association's
current and 10 immediately preceding fiscal years, including
but not limited to itemized and detailed records of all
receipts and expenditures.
(b) Any member of an association shall have the right to
inspect, examine, and make copies of the records described
in subdivisions (1), (2), (3), (4), and (5) of subsection
(a) of this Section, in person or by agent, at any reasonable
time or times, at the association's principal office.
In order to exercise this right, a member must submit a
written request to the association's board of managers or
its authorized agent, stating with particularity the records
sought to be examined. Failure of an association's board of
managers to make available all records so requested within 30
days of receipt of the member's written request shall be
deemed a denial.
Any member who prevails in an enforcement action to compel
examination of records described in subdivisions (1), (2),
(3), (4), and (5) of subsection (a) of this Section shall be
entitled to recover reasonable attorney's fees and costs from
the association.

Hope this helps a bit. I've just submitted my request for the
2004 tax return and final bank statement. We'll see! Beth

LisaS (Illinois)
Posts: 341

Posted:

For Beth- make sure you read the updates to the Act. There have been a number of changes recently and it has been amended on a number of big issues (like late fees no longer can be charged!)

For Renee- you can also check with your mortgage company on whether you are a PUD. If it is a newer TH in Illinois, you most likely are (which in your case is a good thing). It isn't always mentioned in the Association Documents.

ReneeD (Illinois)
Posts: 201

Posted:

Lisa,
Sorry in the delay for responding back to your last posting regarding PUD status.
Regarding your comments for Beth, where does it make reference re: late fees no longer can be charged? and, when did this take effect? Would this take precedence over one's own Decs/ByLaws?
Also, I know I had asked this question in another posting and am still curious to know what is "pecking order" of an Illinois-based HOA?
-ReneeD

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