Page 1

central florida times


a message from the president Second Quarter 2014

contact information P.O. Box 941125 Maitland, FL 32794 407-850-0106

board of directors President: Jamie Rodriguez President-Elect: Alan Garfinkel, Esq. Vice President: Lou Biron Treasurer: Bernie Mapili, CPA Secretary: Suzan Kearns, CMCA, AMS

Dear CAI Central Florida Chapter Members, Can you believe we are in our third quarter already? Where does the time fly to? If you missed Meet the Manager and the Summer Social, you missed the two great events of the summer. I want to thank Suzan Kearns of Community Management Professionals and her committee for all the hard work on Meet the Manager. It was a perfect event for Managers and Management Companies to come together and have a sit down with our Business Partners. It was a fun event for all involved! So thank you everyone. In addition, I want to thank Alan Garfinkel of Katzman Garfinkel and his committee for putting on our Summer Social. The event was a time for us to let our hair down and network with some special people in our business. Another fun event! Glad everyone had a great time. Coming up we have our 4th Annual Golf Tournament on October 24th. Part of the proceeds for the tournament will benefit the Sunshine Foundation Dream Village. The foundation is a very worthy cause headed up by Rich Mergo. This year the tournament will be held at Reunion Golf Course in Kissimmee, so it should be a very special event! Please check out additional details on pages 8 and 9 of the newsletter and on our website at Then December brings our Annual Elections and Holiday Party! I know we're all looking forward to that! I would be very remiss if I didn't say a BIG CONGRATULATIONS to all our new PCAMs who passed their case study and have added more ABCs behind their names! A job very well done everyone! This chapter is very proud of each of you for your hard work and your dedication to your field as managers.

Bill Bishop, CMCA, AMS Dave Holt Gary van der Laan, PCAM

Best regards,

Jamie Rodriguez Chapter President

John Dougherty Matt Vice Bill Jackson, CPA

interested in joining cai central florida? Homeowners, Managers, and Business Partners can become members. If you provide products or services to community associations, CAI can give you direct access to thousands of potential customers and provide unique opportunities. Visit to learn more!


the budget process for homeowners and condominium associations BY WILLIAM A. JACKSON, MBA, CPA


annual budget is a financial planning tool used by Homeowner and Condominium Associations to prioritize spending and set the level and quality of services provided by establishing how income will be used to perform necessary maintenance and repairs. There are two separate budgets that each association must address. The operating budget includes the normal costs of operating the association and is generally developed by the board of directors, shared with association members, and approved at an association meeting after members have had a chance to provide input. The replacement reserve budget provides funds for future capital projects such as paving, roof replacement, and deferred maintenance. The budget process usually begins several months before the end of the association’s fiscal year. The board reviews current revenue and expenses to determine if the items on the current operating budget have been adequately funded and if revenues are at an acceptable level. They often look over contracts to ensure that the vendor has fulfilled the contract requirements and to determine if the scope of work needs adjustment. At this time the board can also solicit bids from vendors who provide a variety of services from accounting to lawn maintenance. The board should also look at the replacement reserve budget each year and use the replacement reserve study as a guide. The reserve study identifies common components for which the association


CE N TRAL F L O R I D A T I M ES | 3 R D Q UARTER 2 0 1 4

has responsibility, estimates the remaining life expectancy of each item, and the repair or replacement cost. The board will determine if the funding in the reserve is still adequate or if any adjustments need to be made. If the current year’s operating budget has not been sufficient to cover expenses and if reserve funds have been used, the board can decide to replenish those funds in the new budget. Only after the expenses have been determined can the periodic maintenance fee for each unit be determined. Once all information has been received and analyzed, the board will set a recommended budget which includes funding for the operating budget as well as the replacement reserve budget. The board will then share the proposed budget with all of the association members, giving them adequate time to study both the current year’s budget and the proposed budget. They should include information that explains changes whether it’s a decrease due to finding a lower-priced vendor or an increase due to inflation or a higher cost of materials. The next step in the budget process is to bring the budget up for discussion and approval at an association meeting. Members have the opportunity to ask questions and provide input. Depending on the association’s governing documents, the board will either vote to approve at this meeting or schedule the vote for the following meeting. Once the board approves the budget, the expenses and association member fees are set for the following fiscal year.

a quick, easy, & free way to increase financial statement integrity SUBMITTED BY JAMES A. BRADLEY, MBA, LCAM


anagement companies are always looking for ways to create strong bonds with community association boards. As a major part of this relationship, it is essential that the board have a strong comfort level with the management company’s ability to maintain associations’ financial documentation with a high level of integrity. Of course, the favorite internal control weapons of these management companies’ accounting departments are the usual tools: segregation of duties, cash disbursement and deposit procedures, reconciliations to the balance sheet, and the board’s ability to freely inspect the association’s online banking (like that which is offered at BB&T). While these are all good and necessary assertions, many management companies overlook a very simple way to add significant integrity to the financial statements: the board approval of the financials in a dually called meeting. As a former association manager, I’ve facilitated hundreds of board meetings and there was a time when we never gave any thought to approving the financials as part of the agenda to the regular board of directors meeting. We had a community that was going through an election notice and we could see from the incoming proxies that a new board was likely going to be installed in the coming months. The new incoming board had been a rouge group that had circulated numerous inaccurate newsletters to the community about the existing board that we represented. The existing board had serious concerns that the new board would try to make some claim that they had mismanaged the association funds. To ensure that the board and the management company were protected from any potential false allegations, our management company had inquired about getting a compilation and some sort of certification


CE N TRAL F L O R I D A T I M ES | 3 R D Q UARTER 2 0 1 4

on the ending balance. The local accounting firm was able to establish a small attestation that met our needs and the compilation yielded a finding that the association should approve the financial statements on a monthly basis. Within days this became a standard practice in all of our communities. Having financial statements approved at a board meeting can have several substantial benefits. The board members (including those that don’t serve as the Treasurer) started reviewing the statements. We found that an overwhelming majority of board members weren’t comfortable approving financial statements that they hadn’t reviewed so they started to go through them with constructive questions and comments. In addition to short term benefits, we also experienced increased accuracy in the classification of expenses and an elevated interest in the budget process. In this day and age of scandals and fraud, management companies are always looking for ways to increase the accounting integrity without having to affect the bottom line. You will find that this slight change in procedure will add tremendous value to your professional management service offering. Your clients will be happy to add the additional agenda item and after a few months it will become second nature.

James A. Bradley, MBA, LCAM (Florida) is the BB&T Association Services Relationship Manager / North and South Carolina. Branch Banking and Trust Company, Member FDIC.

4th Annual




Reunion Golf & Resort Community 7593 Gathering Drive, Kissimmee, FL 34747

8:30am Shotgun Start Four Person Scramble







GOLD SPONSOR $3250 (1)


Two Foursomes included. Company logo on all materials, highlighted throughout event, and time to address attendees at awards luncheon.



Foursome included. Company logo on all materials, highlighted throughout event, and time to address attendees at awards luncheon.

BRONZE BREAKFAST SPONSOR $1750 (1) Table set up as sponsor with company material and company representative!

Contest for free car! Company name/logo on sign at hole during play. Acknowledgement at awards luncheon.


Contest for $5000 cash! Company name/logo on sign at hole during play.


2 sponsors per cart. Company name/logo on cart.


Company name/logo on sign at hole during play.

ALL SPONSORS WILL RECEIVE: ✓ Acknowledgement on Sponsors signage at event. ✓ Company logo/link on event website. ✓ Opportunity to supply promotional materials for goodie bags. (Only non-competing companies may share beverage cart.)


Company name/logo on sign at hole during play.

TEE SPONSOR: $225 (14)

Company name/logo on sign at hole during play. Setups permitted but no food or drinks allowed (course sponsor rules).



Name: _________________________ Company: _______________________ Address: ________________________ City, State, Zip: ____________________ Phone: __________________________ Email: __________________________

□ Check Enclosed □ Charge to Credit Card Below: □ Visa □ Master Card □ American Express Name on Card: _______________________ Account #: __________________________ Exp Date: ____/____ CVV #: __________ Signature: __________________________

Participant: □ $130 (Individual Player) Team Name: _______________________ Player #1: _________________________ Player #2: _________________________ Player #3: _________________________ Player #4: _________________________

Level of Sponsorships:

Total Enclosed: $ ___________________

Make checks payable to: CAI Central Florida Chapter P.O. Box 941125 Maitland, FL 32794

Note: Please contact us to verify availability of sponsorships. Sponsorship is not guaranteed until form and payment are received.

□ $3250 (Gold) □ $2250 (Silver) SOLD □ $1750 (Bronze) □ $1250 (Hole in One) □ $700 (Foursome Photo) SOLD (Putting Contest) SOLD □ $500 (Beverage Cart) □ $400 (Longest Drive) □ $400 (Closest to Pin) □ $225 (Tee)

central florida chapter update remaining luncheons for 2014 • • •

September 4 - 3 for 1: Termite Bonds, Fire Sprinklers, and Water Features October 2 - CEU Course November 6 - Legal Panel Q&A, Community Volunteer Appreciation

All luncheons are held from 11am-1:30pm at the Crowne Plaza in Downtown Orlando

upcoming events • • • • • •

September 9th - Business Partner Roundtable at Leland Management in Orlando October 24th - Annual Golf Outing at Reunion Golf Triplex (see pages 8 and 9 for details) November 13th - Medallion Sponsors Appreciation Dinner November 22nd - Sunshine Dream Village Work Day November TBD - Community Volunteer Board Certification in Seminole County December 4th - Annual Meeting & Holiday Social

More details regarding upcoming events will be posted to - so check back regularly for the most up to date information!

MEET A BANK WITH 20 YEARS IN THE NEIGHBORHOOD. No matter what size your community is, managing it can be a daily challenge. Union Bank® Homeowners Association Services is here to help. For over 20 years, we’ve streamlined the assessment collections process for community associations with specialized tools and services powered by Union Bank product solutions and our proprietary Smartstreet® technology platform. We offer a customized HOA lockbox with same-day processing to accelerate payment collection, reduce mail-in times for checks, and provide homeowners with convenient online payment options. Whatever your needs, Union Bank provides solutions that make it easier to control your daily financial operations. Contact us today at 866-210-2333 to learn more.

©2014 Mitsubishi UFJ Financial Group, Inc. All rights reserved. Union Bank and Smartstreet are registered trademarks of MUFG Union Bank, N.A. Member FDIC.

interested in getting more involved? join a caicf committee! If you are interested in getting more involved in the chapter, joining a committee is a great thing to consider. Below are the different committees that we currently have active. Please feel free to contact any of the following committees: Membership Committee Jamie Rodriguez Tom Harman CA Day/Tradeshow Committee Matt Vice Christy Borden Golf Tournament Committee Scott Pollock 321-689-2794


CE N TRAL F L O R I D A T I M ES | 3 R D Q UARTER 2 0 1 4

Communications Committee Dave Holt 352-552-6930 Bianca Duffield Education Committee Gary van der Laan 407-545-5553 Summer Social Committee Alan Garfinkel, Esq.



elcome to the 2014 budget season. Hopefully, this year will be the best budget year in quite some time. I have seen results of the economic recovery over the associations we audit, review, and compile and the results are looking very promising. Short sales are getting offers in less than a day once on MLS, foreclosures filed from 2009–2011 are reaching closure, and association tenant demand letters are sending their rent payments to the association. The purpose of this article is to help the experienced folk who have been battling the budget wars for a few years now. If this is your first year budgeting, please solicit the help of an experienced CAM, accountant, or otherwise to decipher the tips below to help your budget go from good to great! Also, there are many topics below where legal counsel is needed. Please remember every association has a unique set of governing documents and you may need an attorney to understand what tips below you can utilize at your specific association.

CORE ELEMENTS The core elements of the Budget Plan are three sections: the operating expenses, the reserves, and lastly revenue to pay for the two previous sections. The ultimate goal of a good budget is to prevent an increase by being savvy with any excess unallocated cash from the prior year plus member assessments and other revenue streams to be received.

REVENUE AKA “MEMBER ASSESSMENTS, DUES, MOOLAH” In a traditional budget, revenue has simply been the leftover calculation. For example, a simple budget would have 100


CE N TRAL F L O R I D A T I M ES | 3 R D Q UARTER 2 0 1 4

homeowners with total annual combined expenses of $100,000. To calculate revenue, you would charge member assessments at $1,000 per homeowner to cover the total annual combined expenses. However, in 2013, member assessments are not the only revenue stream after all these years battling the economic downturn with nonpaying members. Some associations have increased the initial capital contributions of transfer ownership in the annual budget from $250 to $1,000. Some Boards have pushed it further and the initial capital contribution not only applies to the initial sale of a home but to every subsequent transfer in ownership down the road. Other revenue streams mentioned earlier are short sales, foreclosures, and tenants that have their rent re-directed to the association until further notice. Short sales are open to collect everything owed to the association at times. Lastly, your legal counsel has finally completed an association foreclosure allowing you to rent the unit or they can intercept tenant rent payment from those homeowner landlords who still refuse to pay their dues. Each homeowner account should be looked at individually to estimate when you might receive such revenue. This money has been on the table for many years now and many associations are finally able to collect it. Therefore, over an annual basis, instead of paying the traditional budget example of $1,000 per homeowner, the additional revenue streams can offset expenses creating a surplus to work with to handle increased expenses or dare I say lower dues! Please keep in mind, there are many other real world factors I’m leaving out to simplify this example to these newer revenue streams. There are reserves to be funded as well as upsides, such as collecting violation fines, late fees, clubhouse profits, bank interest, etc.

OPERATING EXPENSES Operating expenses keep your association running every year. There can be as little as 20 line items to over a 100 line items in this section alone. The overall tip of simply using an average of last year’s actual expenses is not the best way to go on every line item. Overgeneralization will lead to budget blows and special assessments. Below are some bulleted key line items that need more than a last year’s average to be on target:

Utility Bills - Some utility providers send a letter with next year’s incremental bill rates. If you have time, average your monthly consumption against their tier rate multipliers and you can better estimate your cost next year. If you’re overwhelmed with all the information at this point, at least increase utilities 3–5 percent to cover inflationary price increase.

Landscape Replacements - Do not simply copy and paste this past year’s spending. Consider the past few winters, whether you planted cold-hardier plants, or do a winter landscape preparedness with your landscaper.

Insurance - Check with your agent as those rates keep increasing! How high do they expect it to go? Bonus tip: consider reserving the highest dollar amount of any one insurance deductible, which is typically a hurricane. This is a great place to park any extra cash other than reserves.

CPA Fees - These should probably be higher. Just kidding, not really...moving on.

Bad Debt Expense - Look at your prior history to dictate how the market is dealing with your association’s short sales and foreclosures. Generally speaking, most associations should have enough allowance built up from this year, so basically this elephant in the room will stay the same size elephant.

RESERVES EXPENSES The final core element of a budget plan is the Reserves. The reserves are repairs and replacements of items with a useful life greater than a year and a cost greater than $10,000. Ideally, reserves are the easiest factor that should be the most consistent annually. In fact, a simple reserve plan of attack has an expected life of each asset to replace and the same dollar amount saved (aka reserved) each year to get to that expected replacement cost’s value at that future year. For example, if your private roads’ resurfacing expected costs are $16,000 in eight years, then that is $2,000 a year in reserve. A great reserve savings technique is to consider using the pooling method over the component method. But what is pooled versus component? At a high level,

if you have a private road and a gate, then the pooled method allows you to reserve for all items in one combined account despite their separate useful lives and dollars. So when the road needs a facelift, you can use the pooled reserves to restore the road with whatever is in the combined reserve account at that time. Under the component method, you can only use the amount accumulated in the road reserve account, so you might have a special assessment or have to raise the budget to ramp up savings while your gate money is left untouched. For a more detailed analysis, a reserve study performed by a properly licensed engineering firm is a great way to go. In conclusion, my goal is to get you from a good budget to a great one! Budget season can be stressful, but these tips provide ways to increase revenue streams and using better trend indicators to decrease poor budgeting. The end results should leave you in a position to consider a nominal increase or flat budget versus a mandatory increase. Good luck and God speed!

Bernie Mapili, CPA, MST, is Partner of Mapili CPAs, LLC, located in Winter Park, FL. For more information, visit

Fulfilling the requirements of Condos and HOAs in Florida Audits - Compilations - Reviews Tax Returns - Budgeting - Filings ➢ ➢ ➢ ➢ ➢

Big 4 Auditing Expertise CAI Gold Sponsors Reliable Financial Oversight Competitive and Fair Pricing Professional and Personable

Contact us today to address your CPA needs.

407-678-1020 or





hen preparing for an interview, Tracey Clement, CAM, CFCAM, of Leland Management, Inc., suggests applicants should be thoroughly prepared to answer these types of questions AND elaborate on them. Practice by writing out your answers and rehearsing them!

Tell me about a time when you delegated a project effectively.

Tell me about a time when you missed an obvious solution to a problem.

Describe a time when you were faced with a stressful situation that demonstrated your coping skills.

Describe a time when you anticipated potential problems and developed preventive measures.

Give me a specific example of a time when you used good judgment and logic in solving a problem.

Tell me about a time when you were forced to make an unpopular decision.

Give me an example of a time when you set a goal and were able to meet or achieve it.

Describe a time when you set your sights too high (or too low).


Tell me about a time when you had to go above and beyond the call of duty in order to get a job done. Tell me about a time you were able to successfully deal with another person even when that individual may not have personally liked you (or vice versa).

Tell me about a difficult decision you’ve made in the last year.

Give me an example of something you tried to accomplish and failed.

Tell me about a recent situation in which you had to deal with a very upset customer or co-worker.

CE N TRAL F L O R I D A T I M ES | 3 R D Q UARTER 2 0 1 4


Can you elaborate a little more on that?

Such as?

Knowing what you do now, what could you have done differently?

Betsy Barbieux is a Professional Development Coach with Florida CAM Schools, LLC. To learn more, call 352-326-8365, visit www., or email

welcome new members! BUSINESS PARTNERS

Mr. Alexander Carius

Koneco Building Services, Inc. Ms. Brielle Giesen

Mr. Richard Cassara

Premier Security Mr. Mike St. Andre Sunray Paving & Construction Mr. Wes Kirkland Wells Fargo Bank, N.A. Ms. Jennifer Gotlewski

Mr. Joselito Chaparro Ms. Lisa Marie Parker, CMCA Mr. Charles Strode Associa Community Management Professionals, Inc. Mrs. Amanda M. Rina ICON Management


Mr. Ryan Clifton Leland Management, Inc.

Angius & Terry, LLP Ms. Laurie Shrader

Ms. Jennifer Wells-Mrozek Leland Management, Inc.

Becker & Poliakoff, P.A. Mr. Scott Kiernan

Ms. Michelle Barnes Showcase Property Management

HOA Capital Advisors Mr. James Zeldin


MANAGERS Ms. Laurie Carbonneau

Mr. Philip Camden Mr. Mark Becker Glennbrook

thank you to our sponsors! platinum All About Management Alliance Association Bank Asphalt Restoration Technology Systems Associa Community Management Professionals BB&T Association Services Becker & Poliakoff Bouchard Insurance Brown & Brown Insurance Coastal Painting Emergency Services & Reconstruction Glickstein, Laval, Carris, P.A.

Kings III Emergency Communications KW Property Management Leland Management Modern Plumbing Industries, Inc. Morrison Hershfield Ramco Protective Services Robert L. Tankel, P.A. Sentry Management, Inc. South Milhausen The Association Law Firm PLLC Vice Painting


Construction Lawyers LLP Lamphier & Company Mapili CPAs Old Florida National Bank Reserve Advisors


Florida Catastrophe Corporation HomeTeam Pest Defense KWA Engineers, LLC Larsen & Associates Mutual of Omaha Bank/CondoCerts Roof-A-Cide Union Bank HOA Services 22

CE N TRAL F L O R I D A T I M ES | 3 R D Q UARTER 2 0 1 4

CAICF | Third Quarter 2014 Newsletter  
CAICF | Third Quarter 2014 Newsletter