Accepting and Disbursing Funds
Condominium managers must handle funds according to the Real Estate Act and Real Estate Act Rules.
WHAT YOU'LL LEARN
Accepting and Disbursing Funds
Obligations of Condominium Managers
Importance of Compliance and Proper Fund Management
Requirements for Accepting Condominium Corporation Funds
Condominium managers must handle funds according to the Real Estate Act and Real Estate Act Rules.
A brokerage that holds money in trust for a condominium corporation must maintain a trust account in the name of the condominium corporation.
Brokers must ensure proper receipt and documentation of electronic deposits.
A brokerage must provide a receipt or record for all money received and deposited electronically into the trust account.
Requirements for Disbursing Funds
Disbursements must comply with the instructions provided by the condominium corporation.
A brokerage may only disburse money held in trust if it has received written instructions from the condominium corporation.
Funds must be disbursed promptly and only for purposes specified in the corporation’s budget or as otherwise authorized.
Interactive Activity:
Scenario: A condominium corporation sends electronic deposits for monthly fees. Identify the steps a brokerage must follow to comply with the legislation (e.g., issuing a receipt, ensuring deposits are directed to the proper trust account).
Obligations of Condominium Managers
Administering Condominium Corporation Accounts
Managers are responsible for maintaining accurate records of all transactions.
A licensee must ensure that all financial records of the condominium corporation are kept in accordance with the Condominium Property Regulation.
Managers must ensure that all trust funds are used only for the purposes outlined by the condominium corporation.
Trust money must not be used for any purpose other than that authorized by the client.
Monthly Reconciliations and Reporting
Managers must reconcile trust accounts monthly and provide detailed financial reports to the board of directors.
A brokerage must complete a reconciliation of its trust accounts no later than one month following the end of the month being reconciled.
Safeguarding Client Funds
Managers must act in the best interests of the condominium corporation and avoid conflicts of interest.
A licensee must exercise reasonable care and skill when handling client funds and avoid any conflict of interest.
Importance of Compliance and Proper Fund Management
Protecting Client Interests
Proper management ensures the financial health of the condominium corporation and protects owners’ investments.
The primary responsibility of a condominium manager is to protect the financial integrity of the condominium corporation.
Consequences of Non-Compliance
Failing to manage funds properly can result in penalties, suspension of licenses, or even criminal charges.
A breach of the requirements under the Real Estate Act may result in the suspension or cancellation of a license and administrative penalties.
How Compliance Builds Trust
Transparent and accurate financial management fosters trust between the condominium manager, board, and owners.
