Bylaws require an audit. Management company is a worm
Okay, so I’ll try to keep this short and just make multiple posts for the multiple instances of horse crap my HOA is allowing to happen.
I have been going back and forth using the attorney general’s office litigation service. It is a lot like BBB’s litigation where you submit an issue you have and in turn, they will forward it to who you have the issue with and require that they respond. I know I’m pretty much wasting my time going back and forth as I have notice the AG doesn’t actually give a crap but the management company I have an issue with keeps replying and ultimately is incriminating themselves.
I just received today their response to my inquiry as to why there hasn’t been an audit conducted (ever.! from what I’m gathering) even though our bylaws state that one of the duties of the treasurer is, and I quote “to cause an annual audit of the association books to be made by a public accountant at the completion of each fiscal year”. The management company claims that it’s the boards decision if they want an audit done. There reasoning? They quote the Arizona statute that says “Unless any provision in the condominium documents requires an annual audit by a CERTIFIED public accountant, the board of directors shall provide for an annual financial audit, review or compilation of the association.” they then write “As you can see from the comparison, your bylaws don’t include the word “certified” as the statute does. (certified public accountants (CPA) are the only accountants that are authorized to perform audits). Therefore, the board can decide between having an audit, review, or compilation done each year. Hopefully, that should end the discussion on this topic.” Gosh, the audacity of this guy to say that.
What’s even worse is the compilations that was conducted, that company that they hired says this on the first page of that compilation,
“We did not audit or review the financial statements nor were we required to perform any procedures to verify the accuracy of completeness of the information provided by management. We do not express an opinion, a conclusion, nor provide any form of assurance on the financial statements” moreover, “the financial statements are prepared in accordance with the modified cash basis of accounting, a basis of accounting other than accounting principles generally accepted in the United States of America.” They go on to say “Management (that’s you) has elected to omit substantially all the disclosures ordinarily included in financial statements in accordance with the modified cash basis of accounting. If the omitted disclosures were included in the financial statements, they might influence the user’s conclusions about the Association’s assets, liabilities, members’ equity, revenues and expenses.”
What do I do about this? I keep trying to get financial documents but this same guy is very difficult to work with. He says that the way for me to see my communities financial documents is I have to come to their office (45 minutes away from my community) and only on certain days and at certain times on those days. Basically I can only get access to view them whenever he is there and he takes Tuesday, Wednesdays, Saturdays and Sundays off! He also is saying the way I get to view them is on a company TV in their conference room. I have to look at them on a tv one by one as he presents them to me. I cant do that. I cant keep my cool and look at these documents with him standing over me. The first time I feel his breath on me I’ll loose it and I don’t want to hurt anyone.
My bylaws state that the records are to be made available at ALL TIMES during reasonable business hour.
I seriously cant afford a lawyer. Especially with this management company that is charging me thousands for a violation that was completely amended back in 1998! The violations that was amended is for vehicle parking. The management company rewrites the violation so that it reads to mean something else. The vehicle that the violation is for, runs just fine. Not only that but it isnt even my vehicle! Im not sure who it belongs to! Im trying to do everything that I know to do to get these and a few others to get corrected.
They are threatening me with taking my home from me! They are making up their own rules. Our CC&R’s require that any special assessments for capital improvements requires a vote. Well they had a Clint at Goodman Law write a letter to everyone in my community stating we have no rights to vote for a special assessment for capital improvements. The special assessment is for $310,000! We have no emergency. In fact they haven’t even disclosed what the special assessment is even for. All of this while we have over $250,000 in reserves! This is so crazy. Does these sorts of things actually happen!? I’m 34 and worked very very hard to afford to buy my own house here in Arizona. I knew Hoa were rough to deal with but I didn’t know that they were getting away with breaking the law and enforcing fake violations. One where they rewrite and charge random fees stacked on fees and then compound the interest! Please, please would someone help me. I’ll do anything, I just don’t want to loose my home. I just lost both my parents with in the last 4 years. I don’t have anyone or have anywhere I can go if they take my home.
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Steve,
I hear this kind of crap every day from homeowners like you. Your association attorney is FOS and talks out of his butt.
The law is clear unless the association governing documents specify an audit the association is allowed to use either an audit, review or compilation as a financial review tool at their discretion. But your community documents specifically require an audit so the association loses all discretion and must do an audit every year. The total BS about CPA is absolute crap. You are required to do an audit until such time that your governing documents are modified to eliminate that requirement.
From any request to view records the association has 10 business days to provide you access to those records. What your association is doing does not violate the law unless because of his limited availability you are not provided access within 10 days. You are free to request copies of any record, but the association is allowed to charge you $0.15 per page for the copying of those records. Obviously the more specific you are in your records request the less money you need to pay to get those copies that you can then review at your leisure.
While I don’t know what exactly your governing documents say about special assessments I know of no association governing document that allows special assessment to be implemented without a vote of the community. If your governing documents say that special assessments needs to be approved by the members what that assessment will be used for has absolutely nothing to do with whether or not the members get to vote for the approval of that assessment. I don’t care if the assessment is for capital improvements of foreign travel vacations for all the board members, the assessment needs the approval required by the documents for that assessment. Send me a copy of your CC&R’s and bylaws and I’ll tell you what they actually say. I would not ever trust Clint Goodman to tell the truth at any time to any community. Your actual documents dictate the process not his imagination.
Finally, no matter what any attorney says, Arizona Law is clear, a home cannot be foreclosed on for fines and penalties. The association has the right to ask a court to apply a lien on your home for those fines and penalties but even if they do that lien is not foreclosable.
Dennis