HOA & COA Insights

 What happens if a community association didn’t have sufficient funds to transfer to the reserve account as budgeted? If a community association does not have sufficient funds to complete a reserve transfer in a given month, it is not automatically a cause for concern.

What Boards Should Know

Missed or partial reserve transfers can often be made up in future months once cash flow stabilizes.

Any unpaid reserve transfer amounts should be properly recorded on the Balance Sheet as Due To / Due From under Assets and Liabilities.

When funds become available, the outstanding balance can be reversed once the transfer is completed.

Proper tracking ensures financial transparency and prevents misstatements. ST&R’s Accounting Team ensures these items are accurately recorded and reconciled before financials are shared with the Board.

  HOA Loan & Its Re-Amortization 

This is just a pish-ghaza (appetizer) from ST&R’s –  When an HOA loan is re-amortized, the Association’s monthly loan payment to the bank may decrease—but that does not automatically reduce homeowner loan assessments.

What Boards Should Know

HOA loans belong to the Association, not individual homeowners.

Re-amortization adjusts the loan terms with the lender, not participation agreements with homeowners.

Homeowners participating in loan repayment remain subject to the original repayment structure unless formally amended by the Board.

Understanding the difference between Association obligations and homeowner assessments helps Boards communicate clearly and avoid confusion within the community.

  Delayed Year-End Financial Statement – Is it common?

Yes—receiving year-end financial statements up to 45 days after the close of the fiscal year is common and often necessary to ensure accuracy.

Why This Happens

• Accruals for outstanding expenses
• Account re-classifications
• Completion of scheduled reserve transfers
• Clearing or canceling unclear transactions
• Final reconciliation of all balances

ST&R prioritizes clean, accurate financials over speed. Every year-end report is carefully reviewed before release to ensure Boards receive reliable, decision-ready information.

 Disclosure Documents – Escrow/Payoff/Demand Statement/Statement of Account  

Always obtain final outstanding balances and fee details directly from management companies when handling HOA-related property closings. Completing demand/payoff statements yourself can create liability and risk client dissatisfaction.

What Boards & Agents Should Know

• Incorrect balances can create liability for your company.
• Clients may be redirected to you for discrepancies, damaging trust.
• Many states allow management companies to provide statements free of charge; fees should not prevent using the official source.
• Submitting requests through management companies ensures accuracy and protects your reputation.

Relying on official HOA or management-provided statements safeguards clients, reduces errors, and ensures compliance with state regulations. Always source the information from the authority managing the account.