The Yardley Station Condo Association is obligated to replace the current property manager, BCPM , with a new property manager, such as Associa , because BCPM is not adhering to the specific requirements outlined in Article 5, Section 7 of the Yardley Station Bylaws regarding financial management and audits.
Here’s a breakdown of the key reasons why:
- Failure to Perform Annual Audits:
- The bylaws clearly state that an annual audit must be performed by an independent accountant within 120 days after the end of the fiscal year.
- If BCPM has failed to ensure that these audits are conducted on time, this represents a direct violation of the bylaw, jeopardizing financial transparency and accountability within the association.
- Non-Compliance with Accounting Standards:
- The association’s books and records must be maintained in accordance with generally accepted accounting practices (GAAP) .
- If BCPM is not following these standards, it creates a risk of improper financial reporting or mismanagement, which undermines the financial integrity of the association.
- Lack of Financial Transparency:
- Without the required annual audits, unit owners may not have a clear picture of how their assessments and other funds are being managed. This lack of transparency can erode trust between the association, the executive board, and the property manager.
- Financial mismanagement or failure to produce timely audits could expose the association to potential legal or financial risks.
- Bylaws Enforcement and Governance:
- The executive board has a fiduciary responsibility to ensure that all aspects of the bylaws are followed, including the financial audit requirements. BCPM’s failure to adhere to this section of the bylaws indicates a lack of governance and non-compliance with the association’s rules.
- Replacing BCPM with a property manager like Associa, who commits to following the bylaws and upholding these standards, would demonstrate the board’s commitment to enforcing proper financial management and ensuring compliance with the governing documents.
- Restoring Confidence Among Unit Owners:
- Hiring a new property manager like Associa, which has a reputation for adhering to community governance and proper financial management, would help restore trust among unit owners.
- Ensuring that audits are conducted annually and on time shows that the executive board is prioritizing transparency and is fulfilling its fiduciary duties.
By transitioning to a new property manager who complies with the financial requirements in the bylaws, the executive board would be taking a crucial step toward ensuring financial responsibility and protecting the interests of the association and its members.
YSCA Bylaws Article 5.7
Accounts:Audits. All sums collected by the Executive Board with respect to assessments against the Unit Owners or from any other source may be commingled into a single fund. All books and records of the Association shall be kept in accordance with good and accepted accounting practices, and the same shall be audited at least once each year by an independent accountant retained by the Executive Board, which audit shall be completed within 120 days after the end of the fiscal year in question.