Financial Management: Assessments and Accounting

<p>To attain and maintain the reserves at or near 100 percent</p> Signup and view all the answers

<p>To provide uniformity among reports from different organizations</p> Signup and view all the answers

<p>Requiring written notice to debtors</p> Signup and view all the answers

<p>To buy mortgages from lenders</p> Signup and view all the answers

<p>A compilation presents financial statements without assurance that the information conforms to GAAP</p> Signup and view all the answers

<p>To require employers and employees to make matching contributions to Social Security</p> Signup and view all the answers

<p>To adjust existing line items for expected changes</p> Signup and view all the answers

<p>A legal claim by a community association on the property of another to obtain payment of a debt</p> Signup and view all the answers

<p>To determine a stable and equitable funding plan for future major common area expenditures</p> Signup and view all the answers

<p>Net income occurs when income is greater than expenses, while net loss occurs when expenses are greater than income</p> Signup and view all the answers

<p>To verify the accuracy and completeness of financial records</p> Signup and view all the answers

<p>To bring together the estimated expenses with the community's anticipated revenue</p> Signup and view all the answers

<p>Recording an uncollectible debt as an expense</p> Signup and view all the answers

<p>$10,000</p> Signup and view all the answers

<p>Accrual basis of accounting</p> Signup and view all the answers

<p>To keep the reserve cash balance above zero</p> Signup and view all the answers

<p>To record the community association's financial transactions during a given period of time</p> Signup and view all the answers

<p>Threshold funding is based on the baseline-funding concept, but with a predetermined dollar amount</p> Signup and view all the answers

<p>The owner's financial obligation to the community association during a given period of time</p> Signup and view all the answers

<p>To state that the information the community association provides is true to the best of its knowledge</p> Signup and view all the answers

<p>The collection of all assessments due through the end of the fiscal year</p> Signup and view all the answers

<p>A summary of the flow of funds into and out of the community association</p> Signup and view all the answers

<p>Chapter 7 bankruptcy</p> Signup and view all the answers

<p>A type of investment</p> Signup and view all the answers

<p>An item that is added to improve the overall welfare, safety or life of the residents—or to enhance the value of the community association</p> Signup and view all the answers

<p>Chart of accounts = An organized list of titles, descriptions and assigned numbers of all accounts in an organization’s general ledger CPA = Federal Deposit Insurance Corporation, a government agency that guarantees investors’ deposits in member institutions FDIC = A presentation of financial statements by a CPA without the assurance that the information conforms to GAAP Compilation = Certified Public Accountant is an accountant who has passed certain examinations and met statutory and licensing requirements of a US state</p> Signup and view all the answers

<p>FNMA = Federal Home Loan Mortgage Corporation. Buys mortgages from lenders and in doing so require certain types of insurance to be in place FLSA = Regulates and influences such items as the amount of insurance a community association must carry, procedures for financial operations and requirements for the upkeep of property FHA = Federally established secondary mortgage institution that may set requirements that your community association will have to meet if owners are to participate in their financing programs FHLMC = This act addresses minimum wage requirements, maximum hours of work and overtime pay</p> Signup and view all the answers

<p>Discretionary budget line items = These are items based on owner, board and committee desires Expenses = The cost of goods and services used to operate and maintain the community’s property Foreclosure = A legal proceeding filed in court whereby a party with a claim against an owner can claim ownership of the unit involved in order to recover the money it is owed Full funding = The goal of this funding strategy is to attain and maintain the reserves at or near 100 percent as called for on the component inventory</p> Signup and view all the answers

<p>GAAP = Generally Accepted Accounting Principles. Their purpose is to provide uniformity among reports from different organizations Historical trend budgeting = This method begins with the assumption that existing line items are needed. The amount of funds allotted to each during the current year is adjusted for expected changes in the coming year Investment yield = Yield is simply the return received on the investment Investments = Involves the purchase of anything with money value for the purpose of generating additional money over time</p> Signup and view all the answers

<p>FICA = This act requires employers and employees to make matching contributions to Social Security Fair Debt Collection Practices Act = Requires that the person who owes a debt receive written notice Fund reporting method = Consists of preparing separate columns for operating, reserve, and any special funds Commercial reporting method = Combines operating and reserve activities in the same column, as opposed to fund reporting</p> Signup and view all the answers

<p>Chapter 11 bankruptcy = A reorganization because it is designed to allow for an orderly payment to creditors that enable a corporation to continue Chapter 13 bankruptcy = Used to reorganize personal or non-corporate debt Compilation = A presentation of financial statements by a CPA without the assurance that the information conforms to GAAP Engagement letter = Describes the nature of the work to be done, type of report to be prepared, fee for services and time frame for the assignment</p> Signup and view all the answers

<p>Chart of accounts = An organized list of titles, descriptions and assigned numbers of all accounts in an organization’s general ledger CPA = Certified Public Accountant is an accountant who has passed certain examinations and met statutory and licensing requirements of a US state FDIC = Federal Deposit Insurance Corporation, a government agency that guarantees investors’ deposits in member institutions Engagement letter = Describes the nature of the work to be done, type of report to be prepared, fee for services and time frame for the assignment</p> Signup and view all the answers

<p>Fair Labor Standards Act = This act addresses minimum wage requirements, maximum hours of work and overtime pay Federal Housing Administration = Regulates and influences such items as the amount of insurance a community association must carry, procedures for financial operations and requirements for the upkeep of property Federal Home Loan Mortgage Corporation = Buys mortgages from lenders and in doing so require certain types of insurance to be in place Federal Insurance Contributions Act = This act requires employers and employees to make matching contributions to Social Security</p> Signup and view all the answers

<p>Foreclosure = A legal proceeding filed in court whereby a party with a claim against an owner can claim ownership of the unit involved in order to recover the money it is owed Full funding = The goal of this funding strategy is to attain and maintain the reserves at or near 100 percent as called for on the component inventory Fund reporting method = Consists of preparing separate columns for operating, reserve, and any special funds Historical trend budgeting = This method begins with the assumption that existing line items are needed. The amount of funds allotted to each during the current year is adjusted for expected changes in the coming year</p> Signup and view all the answers

<p>Investments = Involves the purchase of anything with money value for the purpose of generating additional money over time Investment yield = Yield is simply the return received on the investment GAAP = Generally Accepted Accounting Principles. Their purpose is to provide uniformity among reports from different organizations Discretionary budget line items = These are items based on owner, board and committee desires</p> Signup and view all the answers

<p>Net income = The amount left after deducting expenses from income. Reserve study = A budget planning tool that considers the current status of the replacement fund. Modified cash basis of accounting = This method records income and expenses on a cash basis with selected items recorded on an accrual basis. Lien = A legal claim by one party on the property of another to obtain the payment of a debt or the satisfaction of an obligation.</p> Signup and view all the answers

<p>Operating budget = The section of a budget devoted to operating activities. Treasury bills = Short-term instruments that mature in 13, 26, or 52 week periods. Members' equity = The fund balance under the fund method of reporting. Representation letter = A letter from the CPA that states that the information the community association provides is true to the best of its knowledge.</p> Signup and view all the answers

<p>Notes to financial statements = The notes accompany the CPA-prepared financial statements. Personal money judgment = A decision by a judge to allow the community association to claim the owner's personal property to settle a delinquent account. Reconciliation of expenses and revenue = To bring together after a difference. Statement of cash flows = A summary of the flow of funds into and out of the community association.</p> Signup and view all the answers

<p>Revenue = The collective items or amounts of income which are appropriated for public expenses. Liabilities = What is owed to others or collected in advance. Major improvement expenses = Items that are not necessarily required, but are added to improve the overall welfare, safety or life of the residents. Net loss = A net loss occurs when expenses are greater than income.</p> Signup and view all the answers

<p>Replacement fund = Funds put aside in reserve for the replacement of major components of a community's common property. Operating expenses = Items that occur on a regular basis. Threshold funding = This method is based on the baseline-funding concept. Reserve cash flow statement = Shows the amount to be funded and the amount to be expended from the replacement fund over a given period of time.</p> Signup and view all the answers

<p>Statement of income and expense = A report that records the community association's financial transactions during a given period of time. Reconciliation of expenses and revenue = To bring together after a difference. Modified cash basis of accounting = This method records income and expenses on a cash basis with selected items recorded on an accrual basis. Notes to financial statements = The notes accompany the CPA-prepared financial statements.</p> Signup and view all the answers

<p>Treasury securities = Long-term instruments that mature in more than one year. Members' equity = The fund balance under the fund method of reporting. Liabilities = What is owed to others or collected in advance. Personal money judgment = A decision by a judge to allow the community association to claim the owner's personal property to settle a delinquent account.</p> Signup and view all the answers

<p>Reserve study = A budget planning tool that considers the current status of the replacement fund. Replacement fund = Funds put aside in reserve for the replacement of major components of a community's common property. Threshold funding = This method is based on the baseline-funding concept. Reconciliation of expenses and revenue = To bring together after a difference.</p> Signup and view all the answers

<p>Net income = The amount left after deducting expenses from income. Net loss = A net loss occurs when expenses are greater than income. Operating budget = The section of a budget devoted to operating activities. Reserve cash flow statement = Shows the amount to be funded and the amount to be expended from the replacement fund over a given period of time.</p> Signup and view all the answers

<p>Representation letter = A letter from the CPA that states that the information the community association provides is true to the best of its knowledge. Threshold funding = This method is based on the baseline-funding concept. Notes to financial statements = The notes accompany the CPA-prepared financial statements. Reserve study = A budget planning tool that considers the current status of the replacement fund.</p> Signup and view all the answers

<p>Assets = Include anything owned that has value Assessment = An examination of the accounting records and procedures of an organization Audit = A financial obligation to the community association during a given period of time Bad debt write-off = Recording an uncollectible debt as an expense</p> Signup and view all the answers

<p>Accrual basis of accounting = Records income when it is earned and expenses when they are incurred Cash basis of accounting = Records income when it is collected and expenses when they are paid Balance sheet = A summary of a community's financial position at a specific point in time Certificate of deposit = A type of accounting method</p> Signup and view all the answers

<p>Baseline funding = The goal of keeping the reserve cash balance above zero Acceleration = The collection of all assessments due through the end of the fiscal year Chapter 7 bankruptcy = A type of funding strategy Assets = A type of bankruptcy</p> Signup and view all the answers

<p>Balance sheet = A summary of a community's financial position at a specific point in time Audit = An examination of the accounting records and procedures of an organization Assessment = A financial obligation to the community association during a given period of time Assets = A type of financial report</p> Signup and view all the answers

<p>Bad debt write-off = Recording an uncollectible debt as an expense Acceleration = The collection of all assessments due through the end of the fiscal year Certificate of deposit = A type of investment with a fixed interest rate Assets = A type of debt</p> Signup and view all the answers

<p>Accrual basis of accounting = Records income when it is earned and expenses when they are incurred Cash basis of accounting = Records income when it is collected and expenses when they are paid Chapter 7 bankruptcy = A type of accounting method Assets = A type of financial obligation</p> Signup and view all the answers

<p>Audit = An examination of the accounting records and procedures of an organization Assessment = A financial obligation to the community association during a given period of time Balance sheet = A type of financial examination Assets = A type of financial report</p> Signup and view all the answers

<p>Certificate of deposit = A type of investment with a fixed interest rate Chapter 7 bankruptcy = A type of bankruptcy that involves liquidation Acceleration = A type of investment Assets = A type of bankruptcy</p> Signup and view all the answers