With professional management
The manager may process transactions under written authority. A designated director should receive bank information independently and review reconciliations, payment activity, and unresolved exceptions.
Controls protect everyone—including the person handling money
Financial controls are procedures that help ensure money is collected, authorized, spent, recorded, and reviewed properly. They can prevent errors, reveal unusual activity, and make transactions explainable.
Florida § 718.111 establishes directors’ fiduciary relationship to owners and their good-faith, prudent-care duties. Practical oversight means asking questions and following up, even when a manager or accountant prepares the reports.
Trust works better with verification. A capable treasurer or manager should welcome a process that documents approvals and independently checks the work.
Protect the funds. Protect the trust.
Controls cover the entire financial cycle
The safeguards below are recommended practices. Adapt them to your association’s documents, staffing, contracts, and professional advice.
| Area | Suggested controls |
|---|---|
| Assessments and collections | Reconcile deposits to owner accounts; review aging balances, credits, refunds, and write-offs. |
| Purchasing and contracts | Define approval authority; check scope and pricing; document conflicts and contract changes. |
| Invoices and payments | Match invoices to authorization and completed work; check duplicates; retain approval evidence. |
| Banking and transfers | Use individual credentials, multifactor authentication, transaction alerts, and independent reconciliation review. |
| Reserves and investments | Track restricted purposes, funding, maturities, access to cash, and approved expenditures. |
| Reimbursements | Require receipts, business purpose, and approval by someone other than the claimant. |
| Reporting and records | Review actual results against budget; preserve supporting records and monitor reporting deadlines. |
| People and access | Maintain authorized-user lists; remove access promptly after departures; document handovers. |
Controls should cover checks, ACH payments, wires, online transfers, automated withdrawals, and reimbursements. A check-signing rule alone leaves important payment channels unreviewed.
Separate authorization, payment, and review
Recommended principle: avoid giving one person unrestricted control over approving expenses, releasing money, recording transactions, and reconciling the bank.
In a small association
If staffing is limited, use an independent second-person review. For example, the treasurer prepares the reconciliation and another director compares it with statements obtained directly from the bank.
Consider two-person approval for significant payments, transfers, and vendor bank changes. Verify what the banking platform actually enforces; two names printed on a signature card do not prove every payment requires two approvals.
Prevent payment-diversion scams
Suggested safeguard: verify changed payment instructions using a previously known telephone number. Do not rely solely on the email containing the new instructions. Require a second check before releasing the payment.
Shared responsibility. Independent review.
Florida requirements and board policies are different
- Association funds: § 718.111 requires funds in the association’s name and restricts commingling. Personal accounts and another association’s funds are not appropriate substitutes.
- Debit cards: § 718.111(15) prohibits an association debit card from being used to pay association expenses. A board policy cannot authorize an exception.
- Records and annual reports: § 718.111 governs financial recordkeeping and annual financial reporting. Confirm the applicable report level, deadlines, and any lawful voting options.
- Reserves: § 718.112 restricts reserve uses. Where an alternative use is legally permitted, the required advance owner approval matters; SIRS-related restrictions can prohibit diversion. Do not treat reserves as spare operating cash.
- Purchasing: § 718.3026 contains written-contract and competitive-bidding requirements, with exceptions. Check applicability before committing to a purchase.
Two-person approval thresholds, monthly review assignments, and fraud-verification routines on this page are recommended controls—not a claim that Florida mandates each one for every transaction.
A practical monthly review packet
Ask for enough information to understand the results and verify material transactions:
- Balance sheet and income/expense report compared with budget.
- Bank statements and reconciliations for all accounts.
- Payment register, significant invoices, and transfer details.
- Delinquency aging and explanations of credits or adjustments.
- Reserve balances, contributions, expenditures, and commitments.
- Open financial questions with a responsible person and follow-up date.
Questions directors should ask
Do cash balances agree with reconciliations? Are old outstanding checks explained? Are unusual vendors, duplicate invoices, unexplained transfers, or large budget differences resolved? Will available operating cash cover upcoming obligations?
An annual audit provides a different level of assurance from a compilation or review. None replaces routine controls or guarantees that every error or fraud will be discovered. Ask the CPA what the engagement covers.
When something does not add up
- Preserve evidence. Retain statements, invoices, emails, approvals, and system records.
- Verify independently. Obtain original information rather than relying only on an explanation from the person involved.
- Contain an immediate loss. Contact the bank promptly about suspected unauthorized activity; involve authorized directors and appropriate professionals.
- Obtain advice. Consult counsel, the accountant, and insurer as appropriate. Avoid public accusations before facts are established.
- Correct the process. Document findings, resolve accounting errors, and close the control gap.
Start with five manageable improvements
Adopt written authority limits; arrange independent monthly bank review; verify vendor payment changes; require supported reimbursements; and maintain a financial deadline calendar.
For Century Village boards, a shared checklist can support consistent habits. Each association still needs its own approvals, account access, and documented oversight.
Official references & related resources
- § 718.111 — Duties, records, reporting, banking, and debit cards
- § 718.112 — Budgets and reserves
- § 718.3026 — Association contracts and bidding
Finances & Reserves Borrowing from Reserves Estoppel Certificates
Updated October 17, 2026. General board education. Have counsel and an association accountant adapt controls to current law and your circumstances.
Test the control—not just the written policy
Board Synergy recommended practiceAssign a control owner and an independent reviewer. Choose a small sample of recent transactions and trace each from request through authorization, delivery, payment, recording, and reconciliation.
- Check whether bank settings actually enforce the intended approval limits.
- Verify changed vendor bank details using an established independent contact.
- Confirm review covers ACH, wires, automated withdrawals, refunds, credits, and reimbursements.
- Record exceptions, corrective actions, and evidence that the correction worked.
After a board or manager change, review authorized users, signers, alerts, recovery arrangements, and unfinished reconciliations. Use the contact and access handoff checklist. Preserve prior transaction evidence while changing access securely.
Connected financial resources
- Accounting and report review →
Connect this topic with the related authority, documentation, and review process.
- Suspected misuse →
Connect this topic with the related authority, documentation, and review process.
- Debit-card restrictions →
Connect this topic with the related authority, documentation, and review process.
- Compensation and benefits →
Connect this topic with the related authority, documentation, and review process.
- Expense reimbursement →
Connect this topic with the related authority, documentation, and review process.
- Unbudgeted expenses →
Connect this topic with the related authority, documentation, and review process.
- Records inspections →
Review access rights and protected information.
- Decision and action worksheet →
Track authorization and follow-through.
- UCO information continuity →
Explore the separate community organization’s systems and access controls.
Florida law establishes statutory duties; governing documents govern authority subject to law; contracts assign agreed services. UCO procedures concern separate UCO functions. The added workflows and review controls are Board Synergy recommended practices. Relevant statutory principles reviewed October 17, 2026; retained historical articles are background, not current fee or legal instructions.