5 Tips for a productive budget season
July 13, 2022
Tis the season – budget season, that is. It’s now time to begin the budget process for your association, and Castle has all the insight to ensure your Board has a productive experience. Here our top 5 tips for tackling financial planning:
1. CONTRACT ESCALATION RATES
Your Property Manager should be intimately knowledgeable in every contract for the association. Each contract has a built-in escalation rate, and that number should be represented in the budget.
2. RESERVES
The new legislation is going to mandate structural integrity reserves – these will not be able to be waived. There is a lack of clarity surrounding some of the items, however, one thing is for sure: the building must start saving for the repairs.
3. INSURANCE
Several insurance carriers have left the state and thus, it’s become more challenging for the broker to secure a policy. The carriers have become much more stringent on who they are providing policies for, i.e., if you have deferred maintenance, your 40-year certification is late, etc.
4. QUALITY CHECK
The most common mistake in budgeting is a simple formula error or a hardcoded number that changes. It is critical that your Property Manager is skilled in looking for these types of errors before it becomes the final version of the budget that will be presented to the Board.
5. START EARLY, FINISH EARLY
Start working on your budget after you receive the June Financials to get the budget meeting completed early so your association can receive their statements/coupons before the end of the year. There are only a couple of companies that generate the coupons, so providing the data early on allows for timely production and shipment.
While setting your association’s annual financials may seem intimidating, the guidance and expertise of seasoned experts like Castle Group can assure this budget season goes smoother than ever for your community. To learn more about how we can support you, request a proposal at https://www.castlegroup.com/request-a-proposal/.
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