Now that 2017 is over and we’re into the start of 2018, it’s a good idea to re-examine the association budget you prepared for the new year. Make sure you’ve accurately anticipated your association budget and don’t experience any unwelcome surprises.
Here are some helpful tips for a successful budget this year:
Contact your service providers
Find out if vendors’ estimated rates in the new year still fit into your association’s budget. This will help you decide whether you should make changes to obtain the best value for the services you’re receiving. For example, you might need to consider switching providers or looking into other options. Once you are able to determine your utility and service costs, it’s easier to operate on an accurate budget.
Update your year-to-date numbers from the previous year
This includes numbers for both income and expenses, which will allow you to gauge whether assets are moving as planned or if you need to account for any that increased unexpectedly.
Tackle revenue shortcomings by following up on any unpaid member assessments—and if there are a significant number of outstanding fees, you might want to consider better collection methods.
Don’t include one-time or non-recurring items
You want to keep one-time income, such as special assessments, separate from your operating income since they won’t be regularly included annually. The same goes for budget items that only show up in a certain year but not for years going forward.
Analyze your reserve goals and funds
Are your plans for specific projects still priority, or have your goals changed in the past year? Also, consider the expenses and projects you’ve planned for in the next five years. If some of those plans have changed—such as the need to move projects forward or push some back—adjust your reserve goals as appropriate.
Check in with association members
Share your proposed budgets with the board and your community’s members to get their feedback. It never hurts to have several others take a look at the numbers to make sure you aren’t missing anything obvious.
With these tips in mind, you can help ensure your association’s budget is on-track for the new year.