Cohousing-L Mailing List: RE: Glamourous new topic! Accounting costs

[Brian Setzler (brian]

Dear Shari,

I was a CPA but am currently retired.

We have someone else who has volunteered to do the Quickbooks accounting so
I'm not involved in that piece.  I don't know how much time he spends do the
accounting but I estimate I could the actual accounting in 1-2 hours per
week.  We have 29 families which means 29 monthly receipts plus any
miscellaneous inflows.  On the expense side, we have utilities and a handful
of other disbursements.  Using a computer, this shouldn't take long for
someone who knows what they are doing and it is an excellent community
contribution.

One task which adds time to this job but could be segregated out is HOA dues
collections for the late payors.

Personally, I don't think there is much value in getting a CPA compilation
report.  I would need to know more but can't imagine that it would be worth
it.

Do you have community members who know how to read a financial statement? Do
you review the statements and financial data monthly to make sure they makes
sense?  Do you have a segregation of duties (eg. bookkeeper doesn't sign
checks)?

Please note that I am not up to speed on tax laws and this is just general
information from my memory.

You may want to pay for the tax return preperation for the first year to
understand how the numbers go from the financial statements to the tax
return.  Basically speaking, the HOA is not a tax paying entity.  It will
pay taxes on investment income and rental income if you have rental
activities.  I believe the IRS publishes a booklet related just to Condo and
HOA associations.  Read that for a good overview.  Someone who is
comfortable doing their own taxes could probably do the HOA after they've
seen it done.

One final point.  Since the HOA has relatively little tax exposure since it
isn't a tax paying entity, doing the tax return yourselves has very little
exposure to nasty consequences.

Brian Setzler
Trillim Hollow Cohousing
Portland, Oregon


-----Original Message-----
From: cohousing-l [at] freedom2.mtn.org
[mailto:cohousing-l [at] freedom2.mtn.org]On Behalf Of S. Fradenburgh & J.
Taylor
Sent: Saturday, December 04, 1999 11:41 AM
To: Multiple recipients of list
Subject: Re: Glamourous new topic! Accounting costs


I just got a quote from a CPA in Atlanta of $90/hr to do a compilation
(very scaled-down version of an audit) and $160/hr to do our tax return.
He estimated a probably minimum of $500 for either one, starting with our
QuickBooks accounts as entered.  I haven't priced any day-to-day accounting
services, like paying bills or taking care of members dues.

Shari Fradenburgh

At 08:13 PM 12/3/99 -0600, Bitner/Stevenson wrote:
>
>As a part of our decision to reimburse our member/accountant for more of
her
>work, I have been given the task of finding out what other built
communities
>pay for accounting services. Please tell me how much you pay and what the
>accountant does for you(taxes, HOA accounting, paying bills, etc.) Do you
>pay on an hourly basis, or more of a retainer thingie?
>
>Thanks in advance.
>
>Liz Stevenson
>Southside Park Cohousing
>Sacramento, CA
>----------
>


********************************
Shari Fradenburgh and Joe Taylor
Lake Claire Cohousing
Atlanta, GA

safjst [at] mindspring.com