Balance Sheet

balance sheet shows a snapshot of the building’s finances at a particular point in time. Our balance sheet starts on the second page of each financial document provided by the board. This page show’s our building’s assets on December 31, 2009 and 2010 respectively. You can take a look at these numbers below, or by clicking the ‘Financials 201x’ links on the very top right of this page. Our assets are as follows:

Asset 2009 2010
Devon Bank – Checking $19,508.44 $9,442.35
Devon Bank – Savings & Repair Fund $21,104.95 $25,959.52
Devon Bank – Decorating Fund $15,122.52 $13,373.31
Devon Bank – Special Assessment $5,759.97 $8,637.40
Employee Advance $30.73
Petty Cash $13.40 $75.00
Total Assets $61,540.01 $57,487.58

If one looks at the numbers, some questions come to mind:

  • Why have are assets in our checking account gone down by over $10,000 in the past year? What was the money spent on? If we withdraw and deposit money into this checking account at the same rate this year as we did last year, we are poised to have a negative balance by year’s end ($-623.74).
  • What is the decorating fund used for? We have not noticed any new “decorations” in the building. Most of the Christmas decorations and lights are reused every year. Additionally, are decorations so expensive and important that we have allotted an amount to buy/maintain them which is equivalent to more than four year’s worth of special assessments for a single unit? How much is actually spent on decorations per year, and what is the amount that is replenished into the account using assessments?
  • Our reserves are really low for a 160 unit building. Why are we running so lean that we only have approximately $360 per unit saved up in total reserves (approx. $57,487.58/160 units)? If we can track and intelligently and honestly allocate this money, we should easily be able to increase our reserves.

The cash flow statement, which is being withheld by building managment (though any unit owner should be able to view and copy it by IL condo law) would be able to answer all these questions. If anyone has any additional analysis of this balance sheet, please let us know by writing a comment!

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2 Responses to Balance Sheet

  1. Gary Brown says:

    Why should owners be required to pay the equivalent of $90,000 per year for an office clerk who can’t even type? Collecting asssessments, paying bills, and maintaining files is low-level work that merits low-level compensation.

  2. Gary Brown says:

    The Condominium Act requires that an Association maintain reasonable reserves for capital replacement projects. TBN has in the neighborhood of $25,000 in reserves. The past few projects have exceeded $1,000,000 each. Which is larger, $1,000,000 or $25,000? How can $25,000. be deemed reasonable reserve in view of a $1,000,000 expense? Isn’t being required to pay special assessments each of the past 10 or more years enough? No wonder that the building is not FHA approved or that banks will not loan money for purchase of units at TBN.

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