Unless the governing documents impose more stringent standards, the board shall do all of the following:
(a)Review, on a monthly basis, a current reconciliation of the association’s operating accounts.
(b)Review, on a monthly basis, a current reconciliation of the association’s reserve accounts.
(c)Review, on a monthly basis, the current year’s actual operating revenues and expenses compared to the current year’s budget.
(d)Review, on a monthly basis, the latest account statements prepared by the financial institutions where the association has its operating and reserve accounts.
(e)Review, on a monthly basis, an income and expense statement for the association’s operating and reserve accounts.
(f)Review, on a monthly basis, the check register, monthly general ledger, and delinquent assessment receivable reports.
Amended by Stats. 2018, Ch. 396, Sec. 3. (AB 2912) Effective January 1, 2019.
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(a)Review Review, on a monthly basis, a current reconciliation of the association’s operating accounts on at least a quarterly basis. accounts.
(b)Review Review, on a monthly basis, a current reconciliation of the association’s reserve accounts on at least a quarterly basis. accounts.
(c)Review, on at least a quarterly monthly basis, the current year’s actual reserve operating revenues and expenses compared to the current year’s budget.
(d)Review Review, on a monthly basis, the latest account statements prepared by the …
(e)Review Review, on a monthly basis, an income and expense statement for the association’s operating and reserve accounts on at least a quarterly basis. accounts.
(f)Review, on a monthly basis, the check register, monthly general ledger, and delinquent assessment receivable reports.
The review requirements of Section 5500 may be met when every individual member of the board, or a subcommittee of the board consisting of the treasurer and at least one other board member, reviews the documents and statements described in Section 5500 independent of a board meeting, so long as the review is ratified at the board meeting subsequent to the review and that ratification is reflected in the minutes of that meeting.
(a)Notwithstanding any other law, transfers shall not be authorized from the association’s reserve or operating accounts without prior written approval from the board of the association unless the amount of the transfer is less than the following:
(a)(1)The lesser of five thousand dollars ($5,000) or 5 percent of the estimated income in the annual operating budget, for associations with 50 or less separate interests.
(a)(2)The lesser of ten thousand dollars ($10,000) or 5 percent of the estimated income in the annual operating budget, for associations with 51 or more separate interests.
(b)This section applies in addition to any other applicable requirements of this part.
Amended by Stats. 2021, Ch. 270, Sec. 2. (AB 1101) Effective January 1, 2022.
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Notwithstanding any other law, transfers of greater than ten thousand dollars ($10,000) or 5 percent of an association’s total combined reserve and operating account deposits, whichever is lower, shall not be authorized from the association’s reserve or operating accounts without prior written board approval. This section applies in addition to any other applicable requirements of this part.
(a)Notwithstanding any other law, transfers shall not be authorized from the association’s reserve or operating accounts without prior written approval from the board of the association unless the amount of the transfer is less than the following:
(a)(1)The lesser of five thousand dollars ($5,000) or 5 percent of the estimated income in the annual operating budget, for associations with 50 or less separate interests.
(a)(2)The lesser of ten thousand dollars ($10,000) or 5 percent of the estimated income in the annual operating budget, for associations with 51 or more separate interests.
(b)This section applies in addition to any other applicable requirements of this part.
AB 9912020-01-01起生效
Amended by Stats. 2019, Ch. 497, Sec. 31. (AB 991) Effective January 1, 2020.
Two Signatures, and What Reserve Funds May Pay For Added by Stats. 2012, Ch. 180, Sec. 2. (AB 805) Effective January 1, 2013. Operative January 1, 2014, by Sec. 3 of Ch. 180.
(a)The signatures of at least two persons, who shall be directors, or one officer who is not a director and one who is a director, shall be required for the withdrawal of moneys from the association’s reserve accounts.
(b)The board shall not expend funds designated as reserve funds for any purpose other than the repair, restoration, replacement, or maintenance of, or litigation involving the repair, restoration, replacement, or maintenance of, major components that the association is obligated to repair, restore, replace, or maintain and for which the reserve fund was established.
Borrowing From Reserves, and Putting It Back Added by Stats. 2012, Ch. 180, Sec. 2. (AB 805) Effective January 1, 2013. Operative January 1, 2014, by Sec. 3 of Ch. 180.
(a)Notwithstanding Section 5510, the board may authorize the temporary transfer of moneys from a reserve fund to the association’s general operating fund to meet short-term cashflow requirements or other expenses, if the board has provided notice of the intent to consider the transfer in a board meeting notice provided pursuant to Section 4920.
(b)The notice shall include the reasons the transfer is needed, some of the options for repayment, and whether a special assessment may be considered.
(c)If the board authorizes the transfer, the board shall issue a written finding, recorded in the board’s minutes, explaining the reasons that the transfer is needed, and describing when and how the moneys will be repaid to the reserve fund.
(d)The transferred funds shall be restored to the reserve fund within one year of the date of the initial transfer, except that the board may, after giving the same notice required for considering a transfer, and, upon making a finding supported by documentation that a temporary delay would be in the best interests of the common interest development, temporarily delay the restoration.
(e)The board shall exercise prudent fiscal management in maintaining the integrity of the reserve account, and shall, if necessary, levy a special assessment to recover the full amount of the expended funds within the time limits required by this section. This special assessment is subject to the limitation imposed by Section 5605. The board may, at its discretion, extend the date the payment on the special assessment is due. Any extension shall not prevent the board from pursuing any legal remedy to enforce the collection of an unpaid special assessment.
Notice and Quarterly Accounting When Reserves Fund Litigation Added by Stats. 2012, Ch. 180, Sec. 2. (AB 805) Effective January 1, 2013. Operative January 1, 2014, by Sec. 3 of Ch. 180.
(a)When the decision is made to use reserve funds or to temporarily transfer moneys from the reserve fund to pay for litigation pursuant to subdivision (b) of Section 5510, the association shall provide general notice pursuant to Section 4045 of that decision, and of the availability of an accounting of those expenses.
(b)Unless the governing documents impose more stringent standards, the association shall make an accounting of expenses related to the litigation on at least a quarterly basis. The accounting shall be made available for inspection by members of the association at the association’s office.