The mission of Las Mañanitas HOA is to secure a safe, sound, beautiful, comfortable community. How exactly do we secure a financially sound organization?
- Healthy Homeowners. We have had no delinquent accounts (> 60 days) for the past two years (maybe longer). Securing fiscal soundness starts with secure revenue sources ... so THANK YOU!
- Financial Controls. Your HOA uses strong controls, including
- Separation of Function. The Community Manager lets the contracts and approves the invoices. Associa Mexico, our accounting services provider, initiates payments of the invoices and payroll registers. The Community Manager also summarizes all invoices and payroll amount submitted to Associa on a spreadsheet we call “the Facturas report” for the month.
- Monthly Financial Reconciliation. Each month, Associa prepares financial statements (a P&L and a Balance Sheet). They share with the Board those financial statements, a copy of all general ledger entries, all bank statements and all bank reconciliations. We can see exactly where every peso went, each month.
- Budget v. Actual. You have seen copies of the Financial Statements and you can see how the “actual” spending tracks to the amount of the budget.
- Fidelity Insurance. Some of you have heard about bookkeepers who embezzled or outright stole money from the small businesses they serve. Associa has control of our main accounts, so we do have exposure to potential misappropriation. We manage that risk two ways. First, Associa is a large company with 225 offices, 11,000 employees, serving 6 million units in thousands of communities. They have internal checks and balances. AND they have a $6 million fidelity insurance bond that protects us.
- Monthly Supervision. Your Board meets monthly. The first item of business each month is a financial review, and questions go to the line-item level.
- Annual Approval and Budgeting. At the annual Assembly, you get the prior year financials and the current year-to-date, showing budget-vs-actual compared to budget. And you get to review and approve the operating budget for the following year.
External Review. Prior boards have authorized an external "Review" of our financial reports by a CPA firm. (See The Difference between an Audit and a Review.). The 2023 Board just authorized a formal Review of our 2022 financial statements by a CPA firm in La Paz.
- Owners Financial Advisory Committee. This is a group, to be formed, of financially capable Owners willing to advise the Board on our financial controls and strategies.
Announcing Owners Financial Advisory Committee
As I meet Owners here in Las Mañanitas, I'm impressed with the talent and experience many of you have. Most of you are willing to contribute a little "community service" -- provided that the time required is reasonable.
I'm hereby requesting volunteers for a new "Financial Advisory Committee" of Owners with accounting or finance capabilities. Your primary task will be to advise the Board as they receive the Review of 2022 Financial Statements from the CPA firm conducting it. I expect this to be in late May and take an hour or two. Please email Wayne <admin@LasMananitasCondos.com>.
 Not only do we have financially responsible Owners, but the HOA Rules make it very uncomfortable for delinquent accounts. The late charges are non-trivial. If someone is 75 days past due then a) they can’t use amenities and b) the HOA can legally seize rental income. If delinquency continues, Mexican law empowers the HOA to start a foreclosure action. Happily, none of these draconian measures have had to be used.
Also, most Owners use the “autopay” option for dues; I personally use it and it really does make life easier. See LasMananitasCondos.com/paying-hoa-fees, Item 2.