Lack of specifics

The financial statements should list the corporation's expenses in detail. I have seen financial statements where the expenses are listed in very general terms so a lot of important information is hidden. For example:

Income
At a Mississauga condo, all the income from the corporation's laundry machines, locker rentals renting the party room and the selling of keys and FOBS were lumped together under Sundry.

There is no way that the owners could track how much was collected from each source from year to year.

When a director insisted that these income groups be separated, the income from the separated items were higher that when everything was listed under Sundry. For example, it became clear that a couple of thousand dollars was not being collected from the locker rentals.

Expenses
If the owners are to have a good understanding how their money is spent, it is important to have all expenses listed in details and that the spending can be compared from one year to another.

Administration
This is so broad a heading that anything and everything can be hidden in here, including bottles of tequila.

When a new board, in Scarborough, was elected at a recent AGM, they found that "administration costs" included $18,000 in expenses put on the corporation's Staples credit card. That works out to $1,500 a month or $120 worth of paper, pens and envelopes per unit per year.

What 150 unit condo spends that much office supplies? Where did the office supplies go?

Professional services
The spending on legal fees, the auditor and engineering should be listed separately. Here is how one property management company listed the corporation's professional services.

2014	$21,985
2013	$58,392
2012	$15,955

How much was being spent on what professional services? There was no way to find out.

A condo, with a competent board and well behaving owners, will have legal fees that average, over a four year period, $800 a year. A shitty condo will average $100,000 a year in legal fees and legal settlements. Which one do you want to live in?

(If every condo had legal fees averaging $800 a year, condo lawyers would be living in cardboard boxes on Yonge Street and would be driving 1985 Ladas.)

At this condo, when owners asked to look at the corporation records, they were told that they had to pay, in advance, $45 a page to see any records.

When the new president talked to the auditor, he was surprised to hear that the condo was paying too much. The auditor said that a similar size condo would be charged $2,500 to $3,000 but that this condo was paying $10,000. When the president asked why, the auditor said that the property management company's record keeping was a mess and so it takes three times longer than normal to perform an audit. (During his reports at the AGMs, the auditor never told the owners that.)

Building maintenance
Everything being lumped together under building maintenance doesn't tell the owners anything.

A big jump in plumbing costs can indicate deteriorated hot water risers that need to be replaced. A huge increase in pest control costs may indicate that the building as a bed bug problem.

The costs by trades should be listed individually.

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