Association Financial Management

The association does. Funds sit in accounts owned by the association, in its own name and tax ID, with the board controlling signatures and authorization. A management company should never commingle association funds with its own or with another association’s. Boards evaluating any firm should ask this question directly and expect a clear answer.

At minimum a balance sheet, an income statement showing actual against budget, a cash disbursements listing, a delinquency report by owner, and reconciled bank statements. The package should arrive on a predictable schedule and early enough to be read before the meeting rather than handed out at the table. A treasurer should be able to trace any number back to a source document.

Collection follows a documented escalation the board adopts in advance and applies consistently to everyone: statement, late notice, formal demand, then referral to the association attorney. Illinois gives associations meaningful remedies, including a lien and, under the Condominium Property Act, a forcible action for possession in defined circumstances. Because those remedies carry statutory notice requirements, counsel drives that stage — but the board sets the policy and the trigger points.

Illinois requires condominium associations to fund reserves that are reasonable for the repair and replacement of common elements, judged against the age and condition of the building’s components, unless owners have voted to waive the requirement. The practical answer comes from a reserve study: a component inventory with remaining useful lives and replacement costs, translated into a funding plan. "Reasonable" is not a number in the statute, which is exactly why the study matters.

When an Illinois condominium unit is sold, the seller must give the buyer a disclosure package covering the association’s finances, insurance, pending litigation, capital expenditures, and any known unpaid balances. In practice the request arrives at the management office, which assembles the package from association records within the statutory response window. Missed or inaccurate responses create real liability for the board, so this is a deadline to track rather than a formality.

It depends on the governing documents and on the size and complexity of the association. Declarations frequently require an annual audit, review, or compilation by an independent CPA — and where they do, the requirement binds regardless of what previous boards have done. Even where it is optional, an independent review earns its cost at a transition, after a change in management, or whenever a board wants outside verification of its own records.