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LEGAL/FINANCIAL

HOW LEGAL/FINANCIAL PROBLEMS ARE SOLVED BY NYC CO-OPS AND CONDOS

The Most Important Document You've Never Read

New York City

Management Report
Feb. 9, 2016

Vincent Baudelot understands this. That’s why he likes to check things out for himself. As the treasurer at the Isabella, a 63-unit condo in Clinton Hill, Brooklyn, he sits up and pays close attention when he receives the monthly report from New Bedford Management.

“I also keep my own spreadsheet with the building’s finances to check from month to month,” Baudelot says. That way, he can compare December’s projected budget to the actual budget – and then back to December from the year before. “I look to see where we actually are versus our budget, and then I look at cash disbursements to make sure that the check for the gardener actually went to the gardener, and then I look to see how many people we have behind on common charges,” Baudelot says.

Meanwhile, at Beech Hills, an 816-unit co-op in Queens, co-op board president Janice Schreibersdorf works closely with the on-site general manager and the bookkeeper to put together a report for the rest of the board every month. Like Baudelot in Brooklyn, she says that the most important thing is the income/expense statement, “so we can see if our spending is normal. Say our fiscal year starts in October, then we can look at October, November, and December and see how much of our budget we’ve spent so far,” she says. “You can compare each month to the past month, and each month to the same month last year.”

There’s a reason Baudelot and Schreibersdorf are so scrupulous in reviewing their management reports. They understand that the report is the key document that keeps a co-op or condo on the right path. Savvy board members, CPAs, and managing agents say this monthly review is crucial to the financial health of a building.

Yet, for all its importance, the management report is frequently not given the attention it deserves. With dozens of pages of financial figures, it can be a daunting affair, and many board members give it a cursory glance. But a monthly management report deserves more. It should be delivered by the 20th of the month and contain:

• Cash disbursements report including accounts payable
• Payroll report
• Copies of paid bills
• Year-to-date and month-to-date summaries
• Comparison of budget to actual expenses
• Copies of all monthly bank statements
• Copy of bank reconciliation
• Cash receipts reports
• Accounts receivable report

Smart board members make a point of actually reading every word of the report. It may not be thriller material, but there are few things more vital to the fiscal health of your building.

Ask the Experts

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Learn all the basics of NYC co-op and condo management, with straight talk from heavy hitters in the field of co-op or condo apartments

Professionals in some of the key fields of co-op and condo board governance and building management answer common questions in their areas of expertise

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