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  1. What is the Florida Administrative Code?
    • The Florida Administrative Code (FAC) is the official compilation of
    • administrative rules for the state of Florida. The Department of State
    • oversees the publishing of the FAC and the monthly supplements. The
    • online, unofficial version of the FAC is updated weekly on the
    • department’s e-rulemaking website.
  2. What is a Rule?
    • According to Chapter 120, Florida Statutes, Administrative Procedure Act
    • (A.P.A.): Rule means each agency statement of general applicability
    • that implements, interprets, or prescribes law or policy or describes
    • the procedure or practice requirements of an agency and includes any
    • form which imposes any requirement or solicits any information not
    • specifically required by statute or by an existing rule. The term also
    • includes the amendment or repeal of a rule.
  3. 61B-22.001
    Definitions.
    (1)
    “Accounting records”
    • include
    • all of the books and records identified in Section 718.111(12)(a)11., Florida
    • Statutes, and any other records that identify, measure, record, or communicate
    • financial information whether the records are maintained electronically or
    • otherwise, including, all payroll and personnel records of the association, all
    • invoices for purchases made by the association, and all invoices for services
    • provided to the association.
  4. (2) “Capital expenditure”
    means any expenditure of funds for:
    • (a) The purchase of an
    • asset whose useful life is greater than one year in length;

    • (b) The replacement of an
    • asset whose useful life is greater than one year in length; or

    • (c) The addition to an
    • asset that extends the useful life of the previously existing asset for a
    • period greater than one year in length.
  5. (3) “Deferred maintenance”
    means any maintenance or repair that:
    • (a) Will be performed less
    • frequently than yearly; and

    • (b) Will result in maintaining
    • the useful life of an asset
  6. (4)
    “Funds”
    • means money and negotiable
    • instruments including, for example, cash, checks, notes, and securities.
  7. (5)
    “Reserves”
    • means any
    • funds, other than operating funds, that are restricted for deferred maintenance
    • and capital expenditures, including the items required by Section
    • 718.112(2)(f)2., Florida Statutes, and any other funds restricted as to use by
    • the condominium documents or the condominium association. Funds that are not
    • restricted as to use by Section 718.112(2)(f), Florida Statutes, the
    • condominium documents or by the association shall not be considered reserves
    • within the meaning of this rule.
  8. (6)
    “Turnover”
    • means
    • transfer of association control from developers to non-developer unit
  9. 61B-22.002
    Accounting Records.

    All
    associations shall maintain accounting records in sufficient
    • detail to permit determination of the revenues
    • and expenses or receipts and disbursements attributable to separate
    • condominiums and operating and reserve funds. Multicondominium associations
    • shall maintain separate accounting records for the association and for each
    • condominium operated by the association. Multicondominium associations created
    • prior to July 1, 2000, that do not create separate ownership interests of the
    • common surplus of the association for each unit, as provided in Sections
    • 718.104(4)(h) and 718.110(12), Florida Statutes, shall not maintain separate
    • fund balances for the association, and shall allocate all association revenues
    • and expenses to each condominium operated by the association pursuant to the
    • provisions of each condominium’s declaration.
  10. 61B-22.003
    Budgets.

    (1)
    Required elements for estimated operating budgets. The budget for each
    association shall:
    • (a) State the estimated common
    • expenses or expenditures on at least an annual basis;

    • (b) Disclose the beginning
    • and ending dates of the period covered by the budget;

    • (c) Show the total
    • assessment for each unit type according to proportion of ownership on a monthly
    • basis, or for any other period for which assessments will be due;


    • (d) Include all estimated
    • common expenses or expenditures of the association including the categories set
    • forth in Section 718.504(21)(c), Florida Statutes. Reserves for capital
    • expenditures and deferred maintenance required by Section 718.112(2)(f),
    • Florida Statutes, must be included in the proposed annual budget and shall not
    • be waived or reduced prior to the mailing to unit owners of a proposed annual
    • budget. If the estimated common expense for any category set forth in the
    • statute is not applicable, the category shall be listed followed by an
    • indication that the expense is not applicable;

    • (e) Unless the association
    • maintains a pooled account for reserves required by Section 718.112(2)(f)2.,
    • Florida Statutes, the association shall include a schedule stating each reserve
    • account for capital expenditures and deferred maintenance as a separate line
    • item with the following minimum disclosures:

    • 1. The total estimated
    • useful life of the asset;

    • 2. The estimated remaining
    • useful life of the asset;

    • 3. The estimated
    • replacement cost or deferred maintenance expense of the asset;

    • 4. The estimated fund
    • balance as of the beginning of the period for which the budget will be in
    • effect; and

    • 5. The developer’s total
    • funding obligation, when all units are sold, for each converter reserve account
    • established pursuant to Section 718.618, Florida Statutes, if applicable.

    • (f) If the association
    • maintains a pooled account for reserves required by Section 718.112(2)(f)2.,
    • Florida Statutes, the association shall include a separate schedule of any
    • pooled reserves with the following minimum disclosures:

    • 1. The total estimated
    • useful life of each asset within the pooled analysis;

    • 2. The estimated remaining
    • useful life of each asset within the pooled analysis;

    • 3. The estimated
    • replacement cost or deferred maintenance expense of each asset within the
    • pooled analysis; and

    • 4. The estimated fund
    • balance of the pooled reserve account as of the beginning of the period for
    • which the budget will be in effect.

    • (g) Include a separate
    • schedule of any other reserve funds to be restricted by the association as a
    • separate line item with the following minimum disclosures:

    • 1. The intended use of the
    • restricted funds; and

    • 2. The estimated fund
    • balance of the item as of the beginning of the period for which the budget will
    • be in effect.
  11. (2)
    Unrestricted expense categories.
    • Expense categories that are not restricted as
    • to use shall be stated in the operating portion of the budget rather than the
    • reserve portion of the budget.
  12. (3) Record
    keeping requirements for budgets
    • The
    • minutes of the association shall reflect the adoption of the budget and a copy
    • of the proposed and adopted budgets shall be maintained as part of the
    • financial records of the association.
  13. phase condominium, when all the phases are built and added together, there exists a single condominium and a single association. In the case of a multi-condominium association, each separate building is its own condominium, even though all the buildings are operated by a single association. In promulgating the budget and charging the common expenses, a multi-condominium association will have a budget for each condominium plus a budget to cover shared expenses for the association property, if any, and other recreational amenities
  14. (4)
    Multicondominium associations.
    Multicondominium
    associations shall comply with the following requirements:
    • (a) Provide a separate
    • budget for each condominium operated by the association as well as for the
    • association. Each such budget shall disclose:

    • 1. Estimated expenses
    • specific to a condominium such as the maintenance, deferred maintenance or
    • replacement of the common elements of the condominium which shall be provided
    • for in the budget of the specific condominium;

    • 2. Estimated expenses of
    • the association that are not specific to a condominium such as the maintenance,
    • deferred maintenance or replacement of the property serving more than one
    • condominium which shall be provided for in the association budget; and

    • 3. Multicondominium
    • associations created after June 30, 2000, or that have created separate
    • ownership interests of the common surplus of the association for each unit as
    • provided in Sections 718.104(4)(h) and 718.110(12), Florida Statutes, shall
    • include each unit’s share of the estimated expenses of the association,
    • referred to in subsection (2) of this rule, which shall be shown on the
    • individual condominium budgets. Multicondominium associations created prior to
    • July 1, 2000, that have not created separate ownership interests of the common
    • surplus of the association for each unit as provided in Sections 718.104(4)(h)
    • and 718.110(12), Florida Statutes, shall include each condominium’s share of
    • the estimated expenses of the association, referred to in subsection (2) of
    • this rule, which shall be shown on the individual condominium budgets.

    • 4. The budgets of
    • multicondominium associations created after June 30, 2000 or of
    • multicondominium associations that have created separate ownership interests of
    • the common surplus of the association for each unit as provided in Sections
    • 718.104(4)(h) and 718.110(12), Florida Statutes, shall show the estimated
    • revenues of each condominium and of the association.

    • (b) Associations that
    • operate separate condominiums in a consolidated fashion pursuant to Section
    • 718.111(6), Florida Statutes, may utilize a single consolidated budget.

    • (5) Limited common
    • elements. If an association maintains limited common elements at the expense of
    • only those unit owners entitled to use the limited common elements pursuant to
    • Section 718.113(1), Florida Statutes, the budget shall include a separate
    • schedule, or schedules, conforming to the requirements for budgets as stated in
    • this rule, of all estimated expenses specific to each of the limited common
    • elements, including any applicable reserves for deferred maintenance and
    • capital expenditures. The schedule or schedules may group the maintenance
    • expense of any limited common elements for which the declaration provides that
    • the maintenance expense is to be shared by a group of unit owners.

    • (6) Phase condominium
    • budgets. By operation of law, the annual budget of a phase condominium created
    • pursuant to Section 718.403, Florida Statutes, shall automatically be adjusted
    • to incorporate the change in proportionate ownership of the common elements by
    • the purchasers and to incorporate any other changes related to the addition of
    • phases in accordance with the declaration of condominium. The adjusted annual
    • budget shall be effective on the date that the amendment to the declaration
    • adding a phase to a phase condominium is recorded in the official records of
    • the county in which the condominium is located. Notwithstanding the
    • requirements of subsection (7) of this rule, the association shall not be
    • required to follow the provisions of Section 718.112(2)(c), Florida Statutes,
    • unless, as a result of the budget adjustment, the assessment per unit has
    • changed.

    • (7) Budget assessment
    • amendments. The association may amend a previously approved annual budget. In
    • order to do so the board of administration shall follow the provisions of
    • Section 718.112(2)(e), Florida Statutes. For example, the board shall mail a
    • meeting notice and copies of the proposed amended annual budget to the unit
    • owners not less than 14 days prior to the meeting at which the budget amendment
    • will be considered.
  15. 61B-22.004
    Guarantees of Common Expenses Under Section 718.116(9)(a)2., Florida Statutes.

    (1)
    Establishment of the guarantee
    • If a guarantee is not included in the purchase
    • contracts, declaration, or prospectus, any agreement establishing a guarantee
    • shall be effective only upon the approval of a majority of the voting interests
    • of the unit owners other than the developer. Approval shall be expressed at a
    • meeting of the unit owners, voting in person or by limited proxy; or by
    • agreement in writing without a meeting if provided in the bylaws. Such guarantee
    • shall meet the requirements of this rule.
  16. (2)
    Guarantee period
    • The period
    • of time for the guarantee shall be indicated by a specific beginning and ending
    • date or event.
  17. (a) The
    ending date
    • or event
    • shall be the same for all of the unit owners of a condominium, including unit
    • owners in different phases of phase condominiums, but may vary for each
    • condominium operated by a multicondominium association.
  18. (b) The
    guarantee may provide for
    • for
    • different intervals of time during a guarantee period with different dollar
    • amounts for each such interval.
  19. (c) The
    guarantee may provide that after the initial stated period, the developer has
    an
    • option to
    • extend the guarantee for one or more additional stated periods. The extension
    • of a guarantee is limited to extending the ending date or event; therefore, the
    • developer does not have the option of changing the level of assessments
    • guaranteed.
  20. (3)
    Maximum level of assessments. The stated dollar amount of the guarantee shall
    be an
    • exact
    • dollar amount for each type of unit identified in the declaration. Regardless
    • of the stated dollar amount of the guarantee, assessments charged to a unit
    • owner shall not exceed the maximum obligation of the unit owner based on the
    • total amount of the adopted budget and the unit owner’s proportionate ownership
    • share of the common elements.
  21. (4) Cash funding
    requirements during the guarantee. The cash payments required from the
    guarantor during the guarantee period shall be determined as follows:
    • (a) If at any time during
    • the guarantee period the funds collected from unit owner assessments at the
    • guaranteed level and other revenues collected by the association are not
    • sufficient to provide payment, on a timely basis, of all common expenses,
    • including the full funding of the reserves unless properly waived, the
    • guarantor shall advance sufficient cash to the association at the time such
    • payments are due; and

    • (b) Expenses incurred in
    • the production of non-assessment revenues, not in excess of the non-assessment
    • revenues, shall not be included in the common expenses referenced in subsection
    • (5) of this rule. If the expenses attributable to non-assessment revenues
    • exceed non-assessment revenues only the excess expenses must be funded by the
    • guarantor. For example, if the association operates a rental program in which
    • rental expenses exceed rental revenues the guarantor shall fund the rental
    • expenses in excess of the rental revenues. Interest earned on the investment of
    • association funds may be used to pay the income tax expense incurred as a
    • result of the investment, such expense shall not be charged to the guarantor,
    • and the net investment income shall be retained by the association. Each such
    • non-assessment revenue generating activity shall be considered separately.
    • Capital contributions collected from unit owners are not revenues, and shall
    • not be used to pay common expenses.
  22. (5) Calculation of
    guarantor’s final obligation. The guarantor’s total financial obligation to the
    association at the end of the guarantee period shall be determined on the
    accrual basis using the following formula:
    • (a) The guarantor shall
    • fund the total common expenses incurred during the guarantee period, including
    • the full funding of the reserves unless properly waived; less

    • (b) The total regular
    • periodic assessments earned by the association from the unit owners other than
    • the guarantor during the guarantee period regardless of whether the actual
    • level charged was less than the maximum guaranteed amount.

    • (c) If a guarantee
    • pursuant to Section 718.116(9), Florida Statutes, existed within a
    • multicondominium association created prior to July 1, 2000, the guarantor’s
    • financial obligation to the association shall be calculated as provided in
    • paragraphs (a) and (b) for each condominium in which the guarantee existed. If
    • a guarantee pursuant to Section 718.116(9), Florida Statutes, existed within a
    • multicondominium association created after June 30, 2000, or within a
    • multicondominium association created prior to July 1, 2000, that has created
    • separate ownership interests of the common surplus of the association for each
    • unit as provided in Sections 718.104(4)(h) and 718.110(12), Florida Statutes,
    • the guarantor’s financial obligation to the association shall include the
    • amount calculated pursuant to Section 718.116(9)(c), Florida Statutes.

    • (d) Expenses incurred in
    • the production of non-assessment revenues, not in excess of the non-assessment
    • revenues, shall not be included in the common expenses referenced in subsection
    • (5) of this rule. If the expenses attributable to non-assessment revenues exceed
    • non-assessment revenues only the excess expenses shall be funded by the
    • guarantor. For example, if the association operates a rental program in which
    • rental expenses exceed rental revenues the guarantor shall fund the rental
    • expenses in excess of the rental revenues. Interest earned on the investment of
    • association funds may be used to pay the income tax expense incurred as a
    • result of the investment, such expense shall not be charged to the guarantor,
    • and the net investment income shall be retained by the association. Each such
    • non-assessment revenue generating activity shall be considered separately.
  23. 61B-22.005
    Reserves.



    (1) Reserves required by statute. Reserves required by Section
    718.112(2)(f), Florida Statutes, for capital expenditures and deferred
    maintenance including roofing, painting, paving, and any other item for which
    the deferred maintenance expense or replacement cost exceeds $10,000 shall be
    included in the budget. For the purpose of determining whether the deferred
    maintenance expense or replacement cost of an item exceeds $10,000, the
    association may consider each asset of the association separately.
    Alternatively, the association may group similar or related assets together.
    For example, an association responsible for the maintenance of two swimming
    pools, each of which will separately require $6,000 of total deferred
    maintenance, may establish a pool reserve, but is not required to do so.

    (2) Commingling operating
    and reserve funds. Associations that collect operating and reserve assessments
    as a single payment shall not be considered to have commingled the funds
    provided the reserve portion of the payment is transferred to a separate
    reserve account, or accounts, within 30 calendar days from the date such funds
    were deposited.

    (3) Calculating reserves
    required by statute. Reserves for deferred maintenance and capital expenditures
    required by Section 718.112(2)(f), Florida Statutes, shall be calculated using
    a formula that will provide funds equal to the total estimated deferred
    maintenance expense or total estimated replacement cost for an asset or group
    of assets over the remaining useful life of the asset or group of assets.
    Funding formulas for reserves required by Section 718.112(2)(f), Florida
    Statutes, shall be based on either a separate analysis of each of the required
    assets or a pooled analysis of two or more of the required assets.

    (a) If the association
    maintains separate reserve accounts for each of the required assets, the amount
    of the current year contribution to each reserve account shall be the sum of
    the following two calculations:
    • 1. The total amount
    • necessary, if any, to bring a negative account balance to zero; and

    • 2. The total estimated
    • deferred maintenance expense or estimated replacement cost of the reserve asset
    • less the estimated balance of the reserve account as of the beginning of the
    • period for which the budget will be in effect. The remainder, if greater than
    • zero, shall be divided by the estimated remaining useful life of the asset. The
    • formula may be adjusted each year for changes in estimates and deferred
    • maintenance performed during the year and may consider factors such as
    • inflation and earnings on invested funds.

    • (b) If the association
    • maintains a pooled account of two or more of the required reserve assets, the
    • amount of the contribution to the pooled reserve account as disclosed on the
    • proposed budget shall be not less than that required to ensure that the balance
    • on hand at the beginning of the period for which the budget will go into effect
    • plus the projected annual cash inflows over the remaining estimated useful lives
    • of all of the assets that make up the reserve pool are equal to or greater than
    • the projected annual cash outflows over the remaining estimated useful lives of
    • all of the assets that make up the reserve pool, based on the current reserve
    • analysis. The projected annual cash inflows may include estimated earnings from
    • investment of principal. The reserve funding formula shall not include any type
    • of balloon payments.

    • (4) Estimating reserves
    • that are not required by statute. Reserves that are not required by Section
    • 718.112(2)(f), Florida Statutes, are not required to be based on any specific
    • formula.

    • (5) Estimating
    • non-converter reserves when the developer is funding converter reserves. For
    • the purpose of estimating non-converter reserves, the estimated fund balance of
    • the non-converter reserve account related to any asset for which the developer
    • has established converter reserves pursuant to Section 718.618, Florida
    • Statutes, shall be the sum of:

    • (a) The developer’s total
    • funding obligation, when all units are sold, for the converter reserve account
    • pursuant to Section 718.618, Florida Statutes; and

    • (b) The estimated fund
    • balance of the non-converter reserve account, excluding the developer’s
    • converter obligation, as of the beginning of the period for which the budget
    • will be in effect.

    • (6) Timely funding.
    • Reserves included in the adopted budget are common expenses and must be fully
    • funded unless properly waived or reduced. Reserves shall be funded in at least
    • the same frequency that assessments are due from the unit owners (e.g., monthly
    • or quarterly).

    • (7) Restrictions on use. In a
    • multicondominium association, no vote to allow an association to use reserve
    • funds for purposes other than that for which the funds were originally reserved
    • shall be effective as to a particular condominium unless conducted at a meeting
    • at which the same percentage of voting interests in that condominium that would
    • otherwise be required for a quorum of the association is present in person or
    • by proxy, and a majority of those present in person or by

    • limited proxy, vote to use
    • reserve funds for another purpose. Expenditure of unallocated interest income
    • earned on reserve funds is restricted to any of the capital expenditures,
    • deferred maintenance or other items for which reserve accounts have been
    • established.

    • (8) Annual vote required
    • to waive reserves. Any vote to waive or reduce reserves for capital
    • expenditures and deferred maintenance required by Section 718.112(2)(f)2.,
    • Florida Statutes, shall be effective for only one annual budget. Additionally,
    • in a multicondominium association, no waiver or reduction is effective as to a
    • particular condominium unless conducted at a meeting at which the same
    • percentage of voting interests in that condominium that would otherside be
    • required for a quorum of the association is present, in person or by proxy, and
    • a majority of those present in person or by limited proxy vote to waive or
    • reduce reserves. For multicondominium associations in which the developer is
    • precluded from casting its votes to waive or reduce the funding of reserves, no
    • waiver or reduction is effective as to a particular condominium unless
    • conducted at a meeting at which the same percentage of non-developer voting
    • interests in that condominium that would otherwise be required for a quorum of
    • the association is present, in person or by proxy, and a majority of those
    • present in person or by limited proxy vote to waive or reduce reserves.
  24. 61B : Division of Florida Condominiums, Timeshares and Mobile Homes
  25. 61B-22.006 Financial Reporting Requirements.

    (1) Basis of accounting. The
    financial statements required by Sections 718.111(13) and 718.301(4), F.S.,
    shall be prepared on the accrual basis using fund accounting in accordance with
    generally accepted accounting principles. Reviewed financial statements shall
    be reviewed in accordance with standards for accounting and review services and
    audited financial statements shall be audited
    • in accordance with generally accepted auditing standards. Reviews and
    • audits of an association’s financial statements shall be performed by an
    • independent certified public accountant licensed by the Florida Board of
    • Accountancy. As used in this rule the terms “generally accepted accounting
    • principles,” “standards for accounting and review services,” and “generally
    • accepted auditing standards” shall have the same meaning as set forth in
    • Chapter 61H1-20, F.A.C.

    • (2) Components. The
    • financial statements required by Sections 718.111(13) and 718.301(4), F.S.,
    • shall at a minimum include the following components:

    • (a) Accountant’s or
    • Auditor’s Report;

    (b) Balance Sheet;

    • (c) Statement of Revenues
    • and Expenses;

    • (d) Statement of Changes
    • in Fund Balances;

    • (e) Statement of Cash
    • Flows; and

    • (f) Notes to financial
    • statements.

    • (3) Disclosure
    • requirements. The financial statements required by Sections 718.111(13) and
    • 718.301(4), F.S., shall contain the following disclosures within the financial
    • statements, notes, or supplementary information:

    • (a) The following reserve
    • disclosures shall be made regardless of whether reserves have been waived for
    • the fiscal period covered by the financial statements:

    • 1. The beginning balance
    • in each reserve account as of the beginning of the fiscal period covered by the
    • financial statements;

    • 2. The amount of
    • assessments and other additions to each reserve account including authorized
    • transfers from other reserve accounts;

    • 3. The amount expended or
    • removed from each reserve account, including authorized transfers to other
    • reserve accounts;

    • 4. The ending balance in
    • each reserve account as of the end of the fiscal period covered by the
    • financial statements;

    • 5. The amount of annual funding required
    • to fully fund each reserve account, or pool of accounts, over the remaining useful life of the
    • applicable asset or group of assets;

    • 6. The manner by which
    • reserve items were estimated, the date the estimates were last made, the
    • association’s policies for allocating reserve fund interest, and whether reserves
    • have been waived during the period covered by the financial statements; and

    • 7. If the developer has
    • established converter reserves pursuant to Section 718.618(1), F.S., each
    • converter reserve account shall be identified and include the disclosures required
    • by this rule.

    • (b) The method by which
    • income and expenses were allocated to the unit owners;

    • (c) The specific purpose
    • or purposes of any special assessments to unit owners pursuant to Section
    • 718.116(10), F.S., and the amount of each special assessment and the
    • disposition of the funds collected;

    • (d) The amount of
    • revenues and expenses related to limited common elements shall be disclosed
    • when the association maintains the limited common elements and the expense is
    • apportioned to those unit owners entitled to the exclusive use of the limited
    • common elements; and

    • (e) If a guarantee
    • pursuant to Section 718.116(9), F.S., existed at any time during the fiscal
    • year, the financial statements shall disclose the following:

    • 1. The period of time
    • covered by the guarantee;

    • 2. The amount of common
    • expenses incurred during the guarantee period;

    • 3. The amount of
    • assessments charged to the non-developer unit owners during the guarantee
    • period;

    • 4. The amount of
    • non-assessment revenues earned by the association, with each non-assessment
    • revenue generating activity disclosed separately, during the guarantee period;

    • 5. The amount of expenses
    • incurred in the production of non-assessment revenues, with each non-assessment
    • revenue generating activity disclosed separately, during the guarantee period;

    • 6. The amount of the
    • developer’s payments pursuant to the guarantee; and

    • 7. Any financial
    • obligation due to or from the developer resulting from the guarantee.

    • (4) Multicondominium
    • associations. Multicondominium associations may present the financial
    • statements required by Sections 718.111(13) and 718.301(4), F.S., on a combined
    • basis as long as the financial statements, notes, or supplementary information
    • disclose the revenues, expenses, and changes in fund balance for each condominium,
    • and the association, as applicable. The financial statements, notes, or
    • supplementary information shall also disclose the revenues and expenses of the
    • association that are not directly associated with specified condominiums, and
    • the method used to allocate such expenses to the condominiums or units, as
    • applicable. Additionally, the reserve disclosures required by this rule shall
    • be presented separately for each condominium and for any association reserves
    • not specifically identified with individual condominiums. The provisions of
    • this rule shall apply to multicondominium financial reporting for fiscal
    • periods ending on or after December 31, 2002. Earlier application of the
    • provisions of this rule is permitted.

    • (5) Developer
    • assessments. All financial reporting required by Chapter 718, F.S., shall
    • disclose the assessment revenues from the developer separately from that of the
    • non-developer unit owners.

    • (6) Financial reports
    • required by Section 718.111(13)(b), F.S.. The financial report required by
    • Section 718.111(13)(b), F.S., shall meet the following requirements:

    • (a) The report shall be
    • prepared using a cash basis method of accounting.

    • (b) The report shall
    • include the reserve disclosures required by paragraph 61B-22.006(3)(a), F.A.C.

    • (c) The report shall
    • include the special assessment disclosure required by paragraph
    • 61B-22.006(3)(c), F.A.C.

    • (d) If the association
    • maintains limited common elements and the expense is apportioned to those units
    • entitled to the exclusive use of the limited common elements the report shall
    • contain the limited common element disclosures required by paragraph
    • 61B-22.006(3)(d), F.A.C.

    • (e) The financial reports
    • of multicondominium associations shall separately disclose the following items:

    • 1. The receipts and
    • expenditures directly associated with specific condominiums; and

    • 2. The receipts and
    • expenditures of the association that are not directly associated with specific
    • condominiums.

    • (7) The minutes of the
    • association shall reflect the number of votes cast by the membership to waive
    • the requirement for audited, reviewed, or compiled financial statements and the
    • type of financial reporting that the association will be preparing and
  26. 61B-22.0062
    Transition Financial Statements; Turnover Audit.

    (1) Period covered. The audit required by Section 718.301(4)(c), Florida
    Statutes, applies to all transfers of association control from developers to
    unit owners pursuant to Section 718.301(4), Florida Statutes, occurring on or
    after April 1, 1992. The audit shall cover a period beginning with the date of
    incorporation of the association, or from the end of the fiscal period covered
    by the last audit if all fiscal periods have been audited, and ending with the
    date of the transfer of association control to unit owners other than the
    developer. Nothing herein precludes the developer from exceeding the
    requirements of this rule by engaging a certified public accountant to audit
    the entire period of developer control rather than from the period covered by
    the last audit.
    • (2) Additional disclosure
    • requirements for turnover audits. The financial statements, notes, or
    • supplementary information shall present the revenues and expenses separately
    • for each fiscal year and any interim periods included in the audit. The notes
    • to the financial statements shall contain the following disclosures:

    • (a) A statement that the
    • financial statements were prepared pursuant to Section 718.301(4)(c), Florida
    • Statutes;

    • (b) A statement of total
    • cash payments made by the developer to the association;

    • (c) If the developer
    • claims to have paid common expenses of the association which do no appear on
    • the books and records of the association, the amount and purpose of each such
    • expenditure shall be identified separately; and,

    • (d) If a guarantee
    • pursuant to Section 718.116(9), Florida Statutes, existed at any time during
    • the period covered by the audit the financial statements shall disclose the
    • following:

    • 1. The period of time
    • covered by the guarantee;

    • 2. The amount of common
    • expenses incurred during the guarantee period;

    • 3. The amount of
    • assessments charged to the non-developer unit owners during the guarantee
    • period;

    • 4. The amount of
    • non-assessment revenues earned by the association, with each non-assessment
    • revenue generating activity disclosed separately, during the guarantee period;

    • 5. The amount of expenses
    • incurred by the association in the production of non-assessment revenues, with
    • each non-assessment revenue generating activity disclosed separately, during
    • the guarantee period;

    • 6. The amount of the
    • developer’s payments pursuant to the guarantee; and

    • 7. Any financial
    • obligation due to or from the developer resulting from the guarantee.

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