Financial State of the Association (Part 2)
Hey everyone,
This is Part 2 of my response to last week’s Board meeting presentation on the financial state of the association. If you haven’t read Part I yet, it may help to start there and the post can be found here:
https://patricksdomain.net/part-1
To begin, it was disappointing to see CFO Riley make his presentation before seeing the March fiscal year-end financial report.
As you can see in the link immediately below, the cover page of CFO Riley’s presentation is entitled, “Financial Summary for Month Ending: 3/31/2024.” Then on the title page he notes how the March Summary is based on the monthly report from Action Property Management. But then as we can see on page 2, no summary was presented:
Financial Summary for Month Ending: 3/31/2024
https://patricksdomain.net/pddocs/TRVMA_Financial_Report_EXCERPT_ONE_04_16-2024.pdf
Again, we are talking about the fiscal year-end report, and it’s the year-end reports that provide the foundation for assessing the true financial state of our association as we head into a new fiscal year. And yet CFO Riley chose to address the state of the association on the heels of a February report that was, to use his own word, “skewed,” and a March report that he has not seen yet, let alone posted to myTRV.
Of course, some people may say, “But Patrick, didn’t the Officers terminate Action Management, isn’t that enough?”
Well, no, not in my opinion, because in important ways I think their solution was overkill. Allow me to explain.
I sincerely believe that the Officers should have addressed the issues with Action Management long ago — nipped them in the bud instead of allowing them to manifest for nearly a year.
In addition, I believe the Board should have made every effort to address the issues with APM without moving to our FOURTH financial services vendor in six years. First we had APM as a full service property management firm, then we moved to FSR for full management services, then we moved *back* to APM for financial services only, and now we’re moving again — this time to HOAAS.
It’s not just that these changes can be inconvenient for our members, it’s that:
(1) The terminations can lead to virtually zero motivation for the vendors once they’re labeled lame ducks. In this instance, CFO Riley publicly recommended that the Board look at new vendors a full nine months before APM’s contract was terminated. In addition, I fear that APM now has little motivation to cooperate with the annual audit just getting underway, because after all, they’ve been terminated. In my opinion, this was not good oversight or a good plan, especially when it was made public without consulting the Board.
(2) The terminations can leave the association with little or no access to important financial records. It keeps me up at night sometimes — the fact that important historical records can go off into the sunset with each terminated vendor. This is a lesson we painfully learned when FSR was terminated and our annual audits were held up for more than a year. And now it seems the Officers have done it again. In fact, my understanding is that just like FSR and APM, HOAAS will also not be operating onsite, which leaves us with little or no local control over important records, or the financial system used to maintain Trilogy’s books.
Finally in this regard, let me add that I’m also concerned with CFO Riley’s follow-up plan, in which he says, “When the March report becomes available, it will be posted on myTRV.” He and the Board apparently have no plan to present the March fiscal year-end report to our members, and no plan to hold a Q&A with our members. I believe we deserve better. After all, it is our money, not the Board’s.
Thank you, everyone. Here is Part 3:
https://patricksdomain.net/part-3
Patrick
