What Types of Trusted Advisors Should Your Association Use?
Hiring a team of trusted advisors ensures you’re making the right choices for your association
Running a community association is like running a business. Legal regulations must be understood and followed, insurance claims must be made, cash flow must be monitored, and vendors must be vetted. Disputes between residents must also be addressed and resolved before they get to court.
Because there are many different concerns when running an association, it’s often too much for the board to handle on its own. Some associations have a full advisory board separate from the association board that provides advice and support on a number of financial or legal topics. Advisors differ from board members in that they don’t make final decisions about the community or take on any responsibility should something go wrong.
There are many different types of trusted professionals that can assist your community association with these matters. Three key advisors to engage with area community association manager (CAM) to oversee the administration and day-to-day tasks, an attorney, and a certified public accountant (CPA).
Here’s a look at each of these key roles.
Community association manager
A CAM is a smart investment for your association. This individual will take all the behind-the-scenes work away from the board so they can focus on other concerns. The CAM can handle maintenance coordination of the property; communications, such as marketing and local outreach; finance and insurance, including collecting dues; and general administration. The CAM can also ensure that community members are following guidelines and policies and make suggestions about what the board may need to update in its policies.
This trusted advisor should be extremely organized and reliable. It also helps if they have excellent people skills because the CAM is often the first point of contact for association owners.
If your board is overwhelmed with management tasks, a CAM can provide much-needed relief, as well as invaluable expertise from an experienced professional in the industry.
Working with an attorney is another great way to strengthen your association. Find a lawyer who specializes in association law so they’ll be well versed in all the legal aspects of running an association.
When disputes arise, an attorney can also step in and help get them resolved. Especially when dealing with disputes between community members, or between a member and the board, an attorney can be an objective third party to help those involved come to an agreement.
An association attorney can also step in if there’s a dispute about language in the covenants, conditions, and restrictions (CC&Rs), offering a helpful interpretation of the wording or meaning. The attorney can then enforce what was meant in the CC&Rs or help the board amend them accordingly.
Just as a corporation would hire an attorney for legal representation, so should homeowners’ and condo associations.
Accounting and finance help
Finally, a CPA is a good idea for any association. Why not allow the CPA to navigate all the changing tax laws and regulations specific to community associations?
Taxes must be filed annually, and audits have to be dealt with, which can put a major time burden on the community association board or even the CAM. CPAs are experienced professionals who deal with these matters for a living, so you’ll feel confident that your finances are in good hands. A CPA can provide the following:
- Review of cash flow – that is, income and expenses
- Budget assistance and forecasts
- Advice on the cash reserve amount to have on hand
- Review of current dues and assessments against association expenses
Usually, if your association is run by a professional management company, the company will handle record-keeping matters.
It’s important to remember that even if your community association hires these trusted advisors for assistance, the association board is ultimately responsible if anything goes wrong, whether insurance, vendor, tax, or other issue arises. These advisors are just meant to fill in the gaps in the board’s legal and financial knowledge.
However, working with trusted advisors has a wide range of benefits and is ultimately worth the investment. Keep your association protected and efficient by working with a CPA, an association attorney, and a CAM.
PeytonBolin is a real estate law firm serving community associations and association members in Florida. We provide a range of legal services for both homeowners’ and condominium association boards and owners within community associations. Whether your association is self-managed or managed by a professional management company, we’re able to help. Get in touch with our team of attorneys today to learn more about the services we provide.