Shared Flashcard Set

Details

Budgets, reserves, Investments and Assessments
Community Association Management Study guide
16
Real Estate & Planning
Professional
06/24/2011

Additional Real Estate & Planning Flashcards

 


 

Cards

Term

 

 

Assessment

Definition

 

 

is the owner's financial obligation to the community association during a given period of time usually one year.

Term

 

 

Baseline Funding

Definition

 

 

The goal of this funding strategy is to keep the reserve cash balance above zero

Term

 

Chart of Account

Definition

 

An orgainized list of titles, descriptions and assigned numbers of all accounts in an organization's general ledger.  The assigned number helps you locate the account The title describes the purpose of the account

Term

 

 

Discretionary budget line items

Definition

 

These are items based on owner, board and committee desires.  They are items people would like to have given their values, lifestyle and preferred level of service "recreational expenses"

Term

 

 

Expenses

Definition

 

Are the cost of goods and services used to operate and maintain the community 's property

Term

 

FHA

Definition
Federal Housing Administration. Regulates and influences such items as the amount of insurance a community association must carry, procedures for financial operations and requirements for the upkeep of property
Term

 

 

 

FHLMC

Definition

 

Federal National Mortgage Corporation

Buys mortgages from lenders and in doing so require certain types of insurance to be in place

Term

 

 

FNMA

Definition

 

 

Federal National Morgage Association.  Federally established secondary mortgage institution that may set requirements that your community association will have to meet if owners are to participate in their financing programs

Term
Full Funding
Definition
The goal of this funding strategy is to attain and maintain the reserves at or near 100 percent as called for on the component inventory.
Term

 

 

Historical trend budgeting

Definition

 

This method begins with the assumption that existing line items are needed.  The amount of funds allotted to each during the current year is adjusted for expected changes in the coming year

Term

 

 

Major improvement expenses

Definition

 

 

consist of items that are not necessarily required, but are added to improve the overall welfare, safety or life of the residents or to enhance the value of the community association as reflected in the resale value of units

Term
Operating Budget
Definition
the section of a budget devoted to operating activities includes operating expenses and major improvement expenses but not the replacement fund
Term
Operating Expenses
Definition
are those items that occur on a regular basis day to day week to week, month to month, and year to year
Term

 

 

Reconciliation of

expenses and revenue

Definition
After you draft both your operating and replacement fund budgets for the coming year, you must reconcile your estimated expenses with your community's anticipated revenume.  To reoncile means to bring together afgter difference
Term

 

 

Replacement Fund

Definition

 

 

consists of funds put aside in reserve for the replacement of major components of a community's common property

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