Paying Your Management Corporation LevyPayments to your Management Corporation:
Please refer to your levy notice for methods of payment.
Management Corporation Accounts
Management Corporations managed by Ace Body Corporate Management have an individual bank account for each management corporation. The strata managing agent is normally the sole signatory to that account under delegation from the members of the management corporation.
An annual general meeting is held at the beginning of each financial year of the management corporation. This meeting sets the budget and addresses any concerns of the members. This sets the "contributions" which the members have to pay each year. The amount contributed by each member is worked out based on a table included in the strata title scheme.
Management Corporation Budget
The main component of the budget is usually the insurance premium that covers the buildings and public liability risks. Other components are the caretaking, grounds maintenance, repairs, common lighting , maintenance of essential services and the manager’s fees.
Management Corporation vary in the extent to which funds are accumulated in Management Corporation account. Many operate on a small margin over the normal annual operating costs while others plan ahead and accumulate some funds for major works such as painting, guttering replacements, fencing, paving etc. Should a major unbudgeted cost occur without sufficient funds in the bank, it is normal practice to establish a special levy to pay for that particular works.
Example budget for a small management corporation:
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Administrative Fund
10 Centre Road, Centreville. (8 units)
|
Proposed |
Last Year's Budget |
Last Year's Actual |
| |
|
|
|
| AGM |
$30.00 |
$30.00 |
$25.00 |
| Administration Expenses |
$165.00 |
$165.00 |
$165.00 |
| Electricity |
$400.00 |
$320.00 |
$400.00 |
General Maintenance
|
$1,068.00 |
$1,068.00 |
$1,000.00 |
| Gutter Cleaning |
$726.00 |
$726.00 |
$726.00 |
| Insurance |
$1,630.00 |
$1,630.00 |
$1,630.00 |
| Lawns & Garden |
$1,300.00 |
$1,200.00 |
$1,200.00 |
| Light Maintenance |
$200.00 |
$120.00 |
$150.00 |
| Management Fees |
$1,650.00 |
$1,650.00 |
$1,650.00 |
| Safety Audit |
$250.00 |
$250.00 |
$250.00 |
| TOTAL ADMIN FUND |
$7,419.00 |
$7,159.00 |
$7,196.00 |
Sinking Funds or Maintenance Plans:
Sinking funds, (or “Maintenance plans” or “reserve funds”) are a form of budgeting for major expenditures and projects. The funds can be used towards painting, purchasing and installing new equipment, roof replacement and general refurbishments. The aim of the fund is to cover long term maintenance of the property to ensure that it remains in a state of good order. Funds are raised in advance in anticipation of future expenditures, thereby reducing financial surprises and hardship.
Maintenance plans proactively help with plan for major forecasted expenditures. As issues are dealt with in a timely manner, the forecasting and funding reduces further complications of reactive funding. One example would be a building painting project that is postponed for consideration and then further postponed as levies are raised. By the time the project starts, severe paint deterioration has caused wood rotting which further increases the scope of work required, increases the cost of the project, and threatens property values and sales. Maintenance plans budget for total replacement of building components rather than estimating or considering maintenance or repairs.
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