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Who’s responsible for preparing your condominiums financial statements?

Lauren Sorbara
Publication date:
September 24, 2021
Article Summary: 

The article Addresses the misconception that financial statements are prepared by auditors. It explains that the responsibility for preparing financial statements lies with the Board of Directors of the condominium corporation. While most condominiums undergo an annual audit, even those with less than 25 units that have waived the audit requirement must still provide financial statements to owners. The article clarifies that auditors issue opinions on the statements, stating whether they are materially correct and accurately reflect the activity for the period. Financial statements are crucial for assessing the stewardship of the board and the health of the corporation, providing important information for owners, potential purchasers, lawyers, engineers, mortgagees, lending institutions, and banks. The article highlights the legal requirement under Section 66 of the Condominium Act of Ontario, 1998 to prepare financial statements regardless of whether an audit is completed. It also lists the necessary components of financial statements, such as the balance sheet, statement of general operations, cash flow statement, reserve fund operations statement, and prescribed information related to the reserve fund study and operation. The article suggests that if a corporation chooses not to have an audit, they should consider alternatives like a Compilation or Notice to Reader. It emphasizes the importance of annually preparing, approving, and providing complete financial statements to owners.


responsible, preparing, condominium, financial statements, audit, condominium corporations, Ontario, owners, misconception, Board of Directors, operations, maintenance, professional management company, auditor, opinion, activity, period, user, stewardship, health, corporation, Condominium Act, Section 66, generally accepted accounting principles,

Source Citation: 
Lauren Sorbara
Who’s responsible for preparing your condominiums financial statements?
September 24, 2021
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