{
  "section": "5565",
  "code": "California Civil Code",
  "law_code": "CIV",
  "citation": "California Civil Code § 5565",
  "heading": "What the Reserve Summary in the Annual Budget Report Must Show",
  "heading_is_editorial": true,
  "effective": "2013-01-01",
  "amended_by": "Added by Stats. 2012, Ch. 180, Sec. 2. (AB 805) Effective January 1, 2013. Operative January 1, 2014, by Sec. 3 of Ch. 180.",
  "official_credit_line": "Added by Stats. 2012, Ch. 180, Sec. 2. (AB 805) Effective January 1, 2013. Operative January 1, 2014, by Sec. 3 of Ch. 180.",
  "official_url": "https://leginfo.legislature.ca.gov/faces/codes_displaySection.xhtml?lawCode=CIV&sectionNum=5565.",
  "page_url": "https://quoroom.org/law/reserves",
  "pending_amendment": null,
  "version_history": [],
  "verified": "two sources agree",
  "verification_note": "Text taken verbatim from the Legislative Counsel of California official code database and checked word for word against an independent publisher.",
  "sources": [
    {
      "url": "https://downloads.leginfo.legislature.ca.gov/pubinfo_2025.zip",
      "accessed": "2026-10-11",
      "name": "leginfo (Legislative Counsel official bulk code database, LAW_SECTION_TBL)",
      "note": "Authoritative. Retrieved with tools/fetch.py, which reads the archive's central directory by HTTP range request and fetches only this section's member. The leginfo.legislature.ca.gov HTML page sits behind a bot challenge; this is the same database that backs it."
    },
    {
      "url": "https://california.public.law/codes/civil_code_section_5565",
      "accessed": "2026-10-11",
      "name": "California Public Law (Public.Law)",
      "note": "Independent publisher, used to check the text word for word.",
      "edition": "2025"
    }
  ],
  "subdivisions": [
    {
      "id": "intro",
      "label": "",
      "text": "The summary of the association’s reserves required by paragraph (2) of subdivision (b) of Section 5300 shall be based on the most recent review or study conducted pursuant to Section 5550, shall be based only on assets held in cash or cash equivalents, shall be printed in boldface type, and shall include all of the following:",
      "anchor": "https://quoroom.org/law/reserves#s5565-intro"
    },
    {
      "id": "a",
      "label": "(a)",
      "text": "The current estimated replacement cost, estimated remaining life, and estimated useful life of each major component.",
      "anchor": "https://quoroom.org/law/reserves#s5565-a"
    },
    {
      "id": "b",
      "label": "(b)",
      "text": "As of the end of the fiscal year for which the study is prepared:",
      "anchor": "https://quoroom.org/law/reserves#s5565-b"
    },
    {
      "id": "b-1",
      "label": "(b)(1)",
      "text": "The current estimate of the amount of cash reserves necessary to repair, replace, restore, or maintain the major components.",
      "anchor": "https://quoroom.org/law/reserves#s5565-b-1"
    },
    {
      "id": "b-2",
      "label": "(b)(2)",
      "text": "The current amount of accumulated cash reserves actually set aside to repair, replace, restore, or maintain major components.",
      "anchor": "https://quoroom.org/law/reserves#s5565-b-2"
    },
    {
      "id": "b-3",
      "label": "(b)(3)",
      "text": "If applicable, the amount of funds received from either a compensatory damage award or settlement to an association from any person for injuries to property, real or personal, arising out of any construction or design defects, and the expenditure or disposition of funds, including the amounts expended for the direct and indirect costs of repair of construction or design defects. These amounts shall be reported at the end of the fiscal year for which the study is prepared as separate line items under cash reserves pursuant to paragraph (2). Instead of complying with the requirements set forth in this paragraph, an association that is obligated to issue a review of its financial statement pursuant to Section 5305 may include in the review a statement containing all of the information required by this paragraph.",
      "anchor": "https://quoroom.org/law/reserves#s5565-b-3"
    },
    {
      "id": "c",
      "label": "(c)",
      "text": "The percentage that the amount determined for purposes of paragraph (2) of subdivision (b) equals the amount determined for purposes of paragraph (1) of subdivision (b).",
      "anchor": "https://quoroom.org/law/reserves#s5565-c"
    },
    {
      "id": "d",
      "label": "(d)",
      "text": "The current deficiency in reserve funding expressed on a per unit basis. The figure shall be calculated by subtracting the amount determined for purposes of paragraph (2) of subdivision (b) from the amount determined for purposes of paragraph (1) of subdivision (b) and then dividing the result by the number of separate interests within the association, except that if assessments vary by the size or type of ownership interest, then the association shall calculate the current deficiency in a manner that reflects the variation.",
      "anchor": "https://quoroom.org/law/reserves#s5565-d"
    }
  ]
}