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Understanding strata finances

Written by dev on . Posted in Committee Education.

Strong financial management is the foundation of every successful strata scheme. Committee members do not need to be accountants, but they should understand how their Owners Corporation’s finances operate and how today’s decisions affect future owners.

Every committee should understand:

  • Administrative and Capital Works Funds.
  • Annual budgets and levy setting.
  • Cash flow and expenditure monitoring.
  • Capital Works Fund forecasting.
  • Financial reporting and auditing requirements.
  • Long-term maintenance planning.
  • Managing arrears and debt recovery.

Financial decisions should always support the long-term sustainability of the building rather than simply minimising short-term levy increases.

Unlike many strata management companies, Strata Real Estate Services has a qualified CPA on staff. This additional financial expertise provides committees with a deeper understanding of budgeting, reporting, forecasting and financial governance, helping owners make informed decisions with confidence.