- This topic has 24 replies, 8 voices, and was last updated 12 years, 8 months ago by .
-
Topic
-
Our AGM is due shortly and I have some questions that I would like to raise at the meeting. However, before the meeting I guess I should confirm that I have some facts at hand.
I cannot find in any documentation that details the interest paid on our strata funds in the bank – should this be communicated on a regular basis? If so, where should I find it? The budget estimate details bank fees and sundries but I can’t find any reference to income from interest.
Is there a fixed or usual percentage split of levy payments between admin and sinking funds?
Many thanks,
Dudley
-
Replies
-
Dudley… a couple of quick (but not short) answers by way of extracts from the (NSW) Strata Schemes Management Act (1996) with my emphases in red.
In answer to your first question, (b) below is compulsory and the audit (d) is optional, depending upon whether or not those in attendance at the AGM see a need for some procedural checking of the financial statements (e.g. for completeness and layout):
34. Notice of an Annual General Meeting must:
(a) be accompanied by a copy of the last financial statements prepared by the owners corporation together with any relevant auditor’s report, and
(b) include a form of motion for adoption of those financial statements, and
(c) include the information referred to in section 98 (2) (d) in relation to each current insurance policy held by the owners corporation, and
(d) include a form of motion to consider the appointment of an auditor and the taking out of insurance of the kind referred to in section 88 (2) if insurance of that kind has not already been taken out, and
(e) include a form of motion for the election of the executive committee, and
(f) include a form of motion to decide the number of members of the executive committee, and
(g) include a form of motion to decide if any matter or type of matter is to be determined only by the owners corporation in general meeting.
and re your second question, you’ll need to get any Motions to the Secretary of your Executive Committee (cc Strata Manager) before the Agenda is finalised:
36 Requisition for Motion to be included on Agenda for General Meeting
(1) Any person entitled to vote at a general meeting of an owners corporation on a motion that does not require a unanimous resolution may, by notice in writing served on the secretary of the executive committee, require inclusion in the agenda of the next general meeting of the owners corporation of a motion set out in the notice and the secretary must comply with the notice.
(2) The secretary must give effect to the requirement of the notice.
(3) Subclause (1) does not require the inclusion of a motion on the agenda of a general meeting for which notices have already been given in accordance with this Schedule but in that case the motion must be included in the agenda of the next general meeting after that.
Duds,
I’m not sure from your question whether you’ve received the Notice of AGM or not.
If you haven’t, what Whale says is correct, you can write your own motions and send them to the secretary or SM to have included on the agenda.
If you have already received the Notice, that it’s too late for that.
You will have to content yourself with asking pertinent (or impertinent) questions on the financial reports at the AGM prior to the vote.
Financial Reports should include: Balance Sheet, Income & Expenditure, Non-Levy Income, Levy Position Report and (hopefully) Detailed Expenses (full transaction list).
Go through them thoroughly and ask questions about anything you don’t understand. You’re entitled to.
If one or more interested owners has done that, there’s probably no need for an auditor, unless you don’t get satisfactory answers. Auditors cost money, they usually only check a “sample” of transactions, and it’s not their job to check whether you got “value for money”.
@Dudley said:
One concerns the approval of the financial statement and if consideration be given to the appointment of an auditor – how important is this?
Many thanks,
We never have an audit (we were told it would cost $1,000 (10 lots)) and everything seems pretty obvious from the EOFY statement.
If we did have an audit I would press for an auditor of our choice because if the SM is doing something illegal using the SM auditor would most probably not uncover it. If you have a good SM they won’t be doing anything illegal so an audit is pointless.
Just to reiterate and clarify, an audit is not required by schemes of under 100 lots but it can be agreed to commission one.
If an audit is commissioned, it has to be conducted by a certified auditor.
A small scheme like yours would only employ an auditor if there was some concern about financial mismanagement.
If you want to be alerted when anyone replies to your posts or responds to this topic, please register and login, then you will be able to subscribe to the topic. The opinions offered in these Forum posts and replies are not intended to be taken as legal advice. Readers with serious issues should consult experienced strata lawyers. NB: Longer threads may spill over to additional pages - look for the numbers on the bottom right, under the last post.
Dudley – I agree that your chance of success would be marginal, but with regard to where the Owners Corporation’s funds may be deposited, Sect 74(1) of the NSW Strata Schemes Management Act (1996) states that “an owners corporation must pay any amounts that are received by it and are not otherwise invested in accordance with this Act into an account established in a financial institution in the name of the owners corporation.”
So it’s entirely up to your Owners Corporation, although there is a list of “deposit taking institutions” that are from time-to-time approved by the NSW Office of Fair Trading as being suitable for holding trust account funds, and that may provide you with a justifiable short list (HERE).
Hi all,
I have been browsing through flat chat and thought that there could be some people here that could offer me help/suggestions with the ongoing owner’s corporation issues I am having.
I currently live in an apartment that is part of 3 apartments in total. All 3 lots have equal lot liability. Since 2010, we have employed a new owner’s corporation manager and there have been on going issues ever since. The issues mainly relate to the funds held within the owner’s corporation. Namely, the manager claims that we are always in deficit of $7,000 – $8,000 and raises levies to cover this deficit – This is done without an AGM meeting. We have a budget which covers all the expenses and there is nothing extraordinary that falls outside of this budget.
One of the other lot owners seems to have complete control over the manager’s decisions. For example, if he doesn’t want an AGM, then the AGM gets pushed back 3 months to a date of his choice. I am constantly querying various things as nothing seems right but I rarely receive a response, when I do, it is with complex figures and explanations I cannot make sense of. The other lot owner, is a very elderly person who just “doesn’t get involved in anything”. I strongly suspect that the other 2 lot owners are not paying any fees or levies. I suspect this because, the elderly person has previously told me on a number of occasions that “I have not received any bills, I haven’t paid anything.” I request proof from the manager that the fees have been paid, she just shows me a ledger which she herself has generated (who’s to say that this is actually accurate?)
I’ve been to VCAT a few times and just seem to get the general run around and get nowhere. Constant adjournments for over a year and also one of the presiding members happened to be friends with one of the lot owners! Finally, their friend was removed from presiding over the case and another member came in. The member made orders for the manager to provide records for me, the manager accordingly, put records onto a disc and gave them to me, I took the disc to an accountant – The accountant himself even had trouble examining the records – There were numerous transactions and entries he discovered that appeared to be reversed transactions back to the other lot owners. The manager could not explain these discrepancies, she kept providing new and/or different documents until finally one of the member’s accepted her submission that the entries were “a mistake” and dismissed the case.
Following this, the manager is charging a fee of some $9,000 approximately for “appearing in VCAT and photocopying”. However, the other 2 lot owners say that they have not received their portion of the bill for $3,000 approximately. I have sent her a few e-mails but she does not respond to me. I have asked her for an AGM but she refuses to hold one. She has since taken another application for fee recovery against me at VCAT.
I am completely drained of this entire situation. Any advice on what I can do from here would be greatly appreciated. I just know deep down there is something untoward going on here – It’s just a matter of proving it.