Preparing a budget forecast is an unavoidable task in co ownership. Its preparation, preliminary examination and adoption will ensure the proper functioning of the syndicate of co-owners. It is up to the Board of Directors to define its terms, in view of the expenses that will have to be paid to allow a syndicate to meet its obligations. The budget also makes it possible to fix the amount of the contributions of each co-owner to the expenses of the co-ownership.
It will be prepared by the Board of Directors or property manager, based on the amounts spent in preceding financial periods, as well as anticipated non-recurring expenses. The preparation of the budget forecast requires time and rigor.
Administrative, maintenance, replacement, improvement or alteration expenses of the common portions are divided among the co-owners. General common expenses are to be distinguished from particular common expenses, which are allocated under different rules. In the first case, it is the relative value of each fraction that is used to establish the co-owners contribution. As for special common expenses arising from common portions for restricted use, the co-owners using them are alone responsible of the expenses resulting therefrom.
The Board of Directors manages the affairs of the syndicate of co-owners, so that it can operate in accordance with the law and the declaration of co-ownership. Its main role is to ensure the preservation of the immovable. As a general rule, it is the decision-making body that ensures the maintenance of its common portions. If necessary, it must undertake the necessary work to ensure its sustainability.
Managing a co-ownership requires accounting and financial skills. If the manager masters them, he will be able, under the supervision of the board of directors, to play a crucial role in the proper operation of the immovable. For instance, he will know how to balance budgets and manage efficiently the funds of the co-ownership such as monitoring contracts with various service providers, the payroll (salary of the janitor) and the work to be done in the short, medium and long term. A review of the various financial tasks that could be entrusted to the co-ownership manager.
Three months ago, we were called to the annual general meeting of co-owners during which co-owners were consulted on the budget forecast. However since the AGM, we have not received a notice from the Board detailing the amount of our contribution to our co-ownership’s operating budget.
Questions: Isn’t the syndicate required to send a notice of assessment for common expenses? If so, what should it provide?
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