apartment (condominium?) accounting

[Maf. King]

Hi Bram,

Welcome to the list.  Note that general "how should I account for this" 
questions are often subject to local laws / regulations and if in doubt you 
should speak to a suitably qualified person who knows your system well...

On Tuesday, 1 November 2016 10:21:50 GMT Bram Mertens wrote:

> The Homeowner association has appointment a company to manage the day to
> day operations of the building. In Dutch this is called a "syndicus", I
> believe the English term would be trustee or syndicate.

As a native English speaker, Trustee works for me, or possibly "Building 
Management Company".  What is translates as doesn't really matter though to 
the questions at hand!

> 
> To finance the costs of repairs to the public areas, electricity and so on
> this trustee has calculated a budget and has divided the expected costs
> amongst the homeowners. Every month the homeowners need to pay their
> advance so the trustee can pay the bills. At the end of the year the
> trustee needs to create a balance sheet and either refund or collect
> additional payments from the homeowners to balance the books.
> 
> How should I manage such advances and the final bill as private home owner?
> Are the advances expenses or still an asset?

I would simply record the ongoing monthly as an expense, if there is a refund 
due at the end of a year, well I would call that a "negative expense" and 
record it in GC that way. 

> 
> Secondly this trustee/syndicate has requested home owners some kind of
> deposit in order to have cash available for ongoing expenses above the
> money available from the monthly advances. When a homeowner sells his
> apartment he/she is refunded this deposit when the new owner has paid
> his/her deposit.
> I'm fairly certain this should be considered an asset (under money owned to
> me?) but I'd like some confirmation on this.

I agree, I'd treat the returnable-deposit as an asset

> 
> Thirdly a homeowner association can decide to create a separate savings
> account to save up for larger repairs to the public area (e.g. new roof).
> This is different from the previous two because first of all it needs to be
> placed in a separate account and the money paid into this account is tied
> to the property. If a homeowners sells his/her apartment this money is sold
> with the property. It only ever gets refunded to an owner if the homeowner
> association is terminated.
> Is this an asset like "money owned to me" or more a fixed asset? Perhaps a
> sub account of the fixed asset?
> 

I think I'd expense it as Expenses:PropertyRepairFund - there is no realistic 
chance of getting it back.  Although if it is likely to grow to a large sum, 
keeping it as a sub-asset of the house makes sense to me, then when the roof 
is repaired you expense from that asset account.  This is where the local 
rules / customs are relevant!

0.02
Maf.