Hire a Condo or HOA Manager to Maintain your Community and Hire a Financial Manager for Accounting
A trend in many industries over the last few decades has been to divide up work among narrowly focused specialists. The medical profession is a great example – no longer do you see a heart doctor but one that specializes in valves or heart arrhythmia procedures. So too community association management is getting more specialized with various manager specialties including high rise and large scale development managers, community loan specialists, community law specialists, community construction project managers and reserve specialists. There is also room for dividing the financial tasks from the community manager role. So why not hire a condo or HOA manager to maintain your community and hire a financial manager for accounting?
HOA Managers Cannot Handle the Workload Alone
All too often, communities fire managers because they “messed up the accounting”. This can be from mailing out owner bills late, not enforcing late fees, not handling delinquencies in a timely way, paying vendors late, not answering owner or board financial questions (poor communication), late financial reports or few reports at all, inaccurate financial reports or poor report formatting, lack of financial control and overspending, and a general lack of transparency.
A manager is handling a lot of requests. From the board’s to do list, owner inquiries, getting bids and managing vendors and projects as well as preparing for meetings. If a manager is handling accounting as well it can be just too much. The manager is meant to be a generalist and know how to guide the community to the right resources – not do all the work themselves. Additionally, if the manager works for a management company that does not invest in systems or qualified accounting personnel and provide training – if the accounting functions are an afterthought – the manager / community partnership starts to experience “messed up accounting” which quickly leads to lack of trust and the relationship comes to an end soon thereafter.
Is There a Better Way to Manage Your HOA Finances?
Separate specialists working on their areas of expertise solves this problem. A Community Association Manager selecting vendors, getting bids for service, supervising maintenance and projects, handling owner and resident issues and other items the board may not want to get involved with or have time provides a great service. A Financial Management specialist handling the monthly collections, bill payment and financial reporting provides timely and accurate financial reports which is also a great service. This divide and conquer model is a safer way to handle the business of operating a community: there will be fewer mistakes and a board’s service expectation is more likely to be met – providing for longer term relationships (less turn over) – which also makes a board’s job easier.
Sometimes the community will hire a manager directly or will hire a management company to provide a manager to handle tasks – it depends where you can find a great manager at a good price. When hiring directly I’ve seen communities hire a manger full time, part time at a flat monthly fee or even hourly.
Most times a community will have a separate agreement with the financial management company and a separate agreement with the manager. If things don’t meet expectations with one party you can maintain the working relationship with the other. This also gives more stability to your operations.
How do you integrate systems from a manager and a financial management company? We suggest the manager uses the management software of the financial management company. For example at Community Financials they get to choose one of our two software systems, Tops or Caliber, and can use the additional management functionality (like work order and violation tracking) – without having to double enter the unit owner contact info into their separate system since we already have it in our systems. Plus it could save both the manager and community money since we provide a manager access to the software for free as part of our monthly financial management fee with the community. And of course the manager (as well as the board) has access to see current financial reports, current delinquencies, and other accounting information in the same place.
However, if a manager is comfortable with the systems they currently use that will work too. If a community used a CPA or bookkeeper that used QuickBooks the manager would have used a separate system to handle the management tasks anyhow.
Trust Community Financials for Your HOA Accounting
Like peanut butter and chocolate – a specialist Community Association Manager and a Community Financial Management vendor can be two great things that go great together (to quote Reese’s Peanut Butter Cups). Interested? Why not hire a condo or HOA manager to maintain your community and hire a financial manager for accounting?
To explore this idea in greater detail for your association’s particular needs schedule a free consultation with Community Financials to discuss how it would work.
