HOA treasurer duties contribute to a financially stable, functional community. Understanding these duties is the first step to executing them successfully. Both current and aspiring board members should learn what the job entails.
What is an HOA Treasurer?
An HOA treasurer is a member of the board who is responsible for managing and protecting an association’s finances. The treasurer position is perhaps the most challenging on an HOA board, and not everyone has what it takes to fill it effectively.
Whether an association must elect a treasurer depends on state laws and the governing documents. In Maryland, for instance, associations organized as nonstock corporations must have at least a treasurer, a secretary, and a president (Section 2–412).
Virginia law is broader, requiring only the titled officers prescribed by the corporation’s bylaws. Still, many governing documents require electing a treasurer, as it is one of the most critical board positions.
What Does an HOA Treasurer Do?
The HOA treasurer duties and responsibilities are quite diverse, often including budgeting, dues and assessments, reserve fund management, disbursements and accounts, recordkeeping, financial reporting, audits, tax preparation, insurance, and checks and balances. Let’s discuss these below.
1. Budgeting
An HOA or condo association operates on a budget, and the treasurer leads its development. Together with the rest of the board, the treasurer anticipates income and expenses based on historical data, existing contracts, vendor increases, and economic trends.
The treasurer is also typically responsible for distributing this budget. Under Maryland law, an association must submit a proposed budget to the homeowners at least 30 days before adoption (Section 11B-112.2). If spending exceeds a line item by more than 15%, the amendment must pass at a special meeting.
2. Dues and Assessments
HOA treasurer duties usually include overseeing the collection of homeowner dues and assessments. They track payment trends, enforce collection policies, and flag any delinquencies. They also factor unpaid dues into the annual budget.
3. Reserve Fund Management
An association’s reserves cover major repairs and replacements for capital components. The treasurer helps ensure that contributions meet funding needs and that the HOA complies with statutory requirements.
In both Maryland and Virginia, associations must conduct an independent reserve study to maintain adequate funding. Maryland law requires associations to fund reserves.
4. Disbursements and Accounts
The HOA treasurer manages bank accounts, reviews vendor contracts for pricing, and approves or processes vendor payments.
Invoices usually go through them first, but the person who signs the checks shouldn’t also approve disbursements or record them in the books. While the treasurer typically oversees these tasks, a separate board member or the president can assist to ensure checks and balances.
5. Recordkeeping
Boards rely on accurate financial records to make smart decisions. It is one of the HOA treasurer responsibilities to maintain these records, including ledgers, receipts, bank reconciliation reports, and financial statements.
6. Financial Reporting
The HOA treasurer prepares the association’s financial reports and presents them to both the board and the homeowners. Not all volunteer treasurers have the expertise for this, so it helps to hire a Certified Public Accountant (CPA) or an HOA management company.
One of the most critical reports is the HOA treasurer report. This report is usually delivered every month during regular board meetings. The treasurer may also present a summarized version at the annual membership meeting.
The treasurer report includes:
- Beginning and ending cash balances
- Income summary
- Expense summary
- Balance sheet
- Budget vs actual report
- Reserve fund status
- Delinquency report
- Accounts payable
- Bank reconciliation confirmation
- Investment summaries (if any)
7. Audits
Audits confirm the accuracy of the association’s finances and promote transparency. While not all associations are mandated to perform an audit, it is still a good idea to schedule one anyway.
An HOA treasurer can’t conduct the audit. An independent professional must conduct it. Still, the secretary can assist by providing all key documents, records, and information the auditor may need.
8. Tax Preparation
Although structured as a nonprofit, an HOA or condo association must still pay taxes and file tax returns. The HOA treasurer works closely with the association’s CPA to ensure it meets all tax obligations.
9. Insurance
Most associations must carry certain types of insurance, such as property, liability, and fidelity insurance. With help from the other directors, the treasurer obtains quotes, compares bids, and secures the best policies for the community.
10. Checks and Balances
While internal controls shouldn’t fall solely on the treasurer, the treasurer typically leads the charge. Common practices include segregation of duties, dual signatures and approvals, independent bank reconciliations, direct deposits and lockboxes, regular financial reviews, and digital access controls. These help prevent fraud and spot discrepancies early.
Should the HOA Treasurer Have a Financial Background?
Treasurer qualifications generally depend on state laws and the governing documents, but most associations don’t strictly require a formal financial or accounting background.
That said, it is a major advantage for the HOA treasurer to have some sort of experience managing finances. Financial literacy helps them track income and expenses more accurately, read financial statements, and spot inconsistencies before they become bigger problems.
Accounting and financial management are often key parts of an HOA treasurer job description, but not all communities are fortunate enough to have volunteers who possess financial education. As a result, many opt to hire a CPA or an HOA management company.
What is the HOA Treasurer Salary?
The HOA treasurer role is generally unpaid, meaning they don’t receive a salary.
State laws and the governing documents may limit compensation for board members. Even when permitted, many communities skip it because pay can change the nature of the job. Volunteers are afforded certain legal protections, and they can lose them if they get paid.
An Indispensable Role
Every board member plays an essential role in a community’s operations, including the treasurer. Homeowners and directors must understand the different HOA treasurer duties, whether they have an interest in the position or simply for accountability.
Keymont Community Management offers expert management services to associations in Virginia, Maryland, and Washington, DC. Call us today at 703.752.8300 or request a proposal.
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