hoa-financial-reporting-faq

What financial statements should an HOA provide to homeowners?

Discover essential financial statements every HOA should provide to homeowners—for transparency and informed decision-making.

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D. Goren

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Updated Jan, 12

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What financial statements should an HOA provide to homeowners?

 

What Financial Statements an HOA Should Provide

 

Homeowners are generally entitled to see the financial records that show how their dues are being used. Exact requirements depend on state law and the HOA’s governing documents (usually the bylaws), but the core financial statements are similar across most states.

Below are the statements an HOA should provide, what each one means, and when owners can expect access.

 

  • Balance sheet: Shows the HOA’s total assets (money in accounts, reserves, property), liabilities (debts, unpaid bills), and net worth. This helps owners understand overall financial health.
  • Income and expense statement (also called profit and loss): Lists all money collected and all money spent during a period. It should show dues income, late fees collected, landscaping costs, insurance premiums, management fees, and similar items.
  • Budget for the current year: A forward-looking plan showing how the board expects to spend dues. Most states require this to be shared annually before or at the start of the fiscal year.
  • Reserve study or reserve summary: Explains long‑term repair needs (roofing, paving, pools, elevators) and how much money should be saved for them. Some states require a full reserve study every few years; others only require a basic summary.
  • Reserve fund financials: A statement showing how much money is actually in the reserve fund, how much was contributed, and what was spent on long‑term projects.
  • Accounts receivable aging report: Shows unpaid dues by homeowner (sometimes names are redacted depending on state). This reveals collection problems without exposing private details where prohibited.
  • Accounts payable report: Lists unpaid vendor bills so owners see what obligations are outstanding.
  • Bank statements: Many states allow owners to inspect them upon request, even if they aren’t automatically distributed. Reviews help confirm spending matches the financial reports.
  • Annual financial review or audit: Required in some states based on HOA size or revenue. A review or audit is done by an independent CPA to confirm accuracy.

 

How and When Homeowners Receive These

 

  • Annual packet: Typically includes the budget, year‑end financial statements, and sometimes the reserve summary.
  • Monthly or quarterly reports: Often provided at board meetings or posted in an owner portal, depending on the HOA’s practices.
  • On‑request inspection: State laws usually let owners request records in writing. The HOA may charge a small copy or retrieval fee, but cannot refuse without a legal reason (for example, privacy limits).

In short, homeowners have broad rights to see how dues are managed. If something is unclear, you can request specific documents, and the HOA should provide them within a reasonable time under state law.

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