HOA Board Member and Financial Responsibility
HOA Board members have many responsibilities, including regulating the finances of the association. Maintaining stable finances is one of the most important duties Board members are tasked with, therefore it is important to know how to achieve that goal. Let’s look at some helpful tips that will make managing finances as simple as possible:
- Responsibilities
It is important to note who is responsible and what they are responsible for. Your association may be utilizing a property management company that manages their finances. However, many associations handle their finances themselves. If your association is handling finances internally, the first step to having strong finances and a strong team is to break down responsibilities.
- Always Keep Records
One of the best practices to being financially responsible is to always keep records of past finances. This allows for new Board members to review past financials and stay informed.
When it comes to keeping records, organization is key. The last thing anyone wants to do is search through stacks of papers and documents. Taking some time to identify what records are worth keeping will allow you to keep everything much more organized. Also, it is important to keep the records in a safe place, especially if you opt for physical records.
- Prepare A Budget
Preparing a proper budget is vital to keeping strong finances. Looking back at past budgets may help you prepare a more accurate budget for years to come. Always keep part of the budget set aside for unexpected issues that may arise. It is important to keep in mind homeowners’ associations are nonprofit organizations, therefore the dues they collect must be used to better the community.
- Be Transparent
It is important to gain the trust of your community members. The first step to gaining trust is being transparent. Communicate updates to the homeowners and allow for questions to increase transparency. Lastly, try to keep residents involved. An easy way to do this is forming budget committees consisting of residents who are interested in the finances of the community.
To learn more, read Vesta’s article on how to prepare an HOA budget here.
