Kenneth R. Sechler, Attorney at Law - Lawyer, Dublin, Ohio

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Attorney at Law - Lawyer

Dublin, Ohio


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At least annually, an Association may want to conduct a legal audit of the affairs of the Condominium or Homeowners Association to assist in a determination of whether the Association is being properly managed.

The following checklist is suggested as a starting point, but each Association, after consultation with legal counsel and other advisers, may wish to make revisions so the checklist is tailored to the needs of the particular Condominium or Homeowners Association.

1. Legal Responsibilities of Board Members. Are the officers and directors familiar with their legal obligations as officers and board members under Ohio law, under the terms of the condominium declaration or the subdivision restrictions, and under the terms of the corporate articles and bylaws?
2. Changes in the Law. In the past year, have there been any changes in the laws that affect the Association or the legal obligations of the officers, directors, or members?
3. Lawyer Review. When was the last time a lawyer conducted a legal review for the Association? If the Association is relying upon a non-lawyer, whether a volunteer or a manager, for legal advice or legal services such as the preparation of legal documents, consider whether that reliance falls short of the legal obligation to make decisions with the care that an ordinarily prudent person would use.
4. Status of Corporation. If the Association is incorporated:
  a. Have all required filings been made and is the corporation in good standing?
  b. When is the next filing required?
  c. Who is the statutory agent?
  d. Is the filed address of the statutory agent the same as the agentís current address?
  e. Is the person named as statutory agent still the proper choice?
5. Legal Documents. Does the board have a complete set of its governing documents?
  a. Articles of Incorporation and all amendments and statutory agent documents.
  b. Bylaws (formerly referred to as Code of Regulations).
  c. Condominium Declaration and all amendments or Subdivision Restrictions and all amendments.
  d. Drawings and plats.
  e. Easements and other exceptions to title.
  f. Contracts, such as for management, common area maintenance, etc.
  g. Are you sure the documents you have are copies of the official documents?
6. Format of Documents. In what format are the documents? Should the documents be converted to digital format for more convenient storage and distribution?
7. Meetings - Compliance with Requirements. Are Association and directors meetings being properly conducted? What are the requirements for the Associationís annual meeting? What are the requirements for voting? When are the next meetings required to be held?
8. Taxes. What are the Associationís obligations regarding tax filings and when are the next filings due?
9. Summary of Important Information. Do you have a convenient list summarizing important information?
  a. The list of members and the list of units or lots, and, for condominiums, the list of percentage interests.
  b. The corporationís charter number.
  c. The date the next corporate filing is due.
  d. The name and address of the statutory agent.
  e. The corporationís taxpayer identification number (Employer Identification Number).
  f. The tax forms the Association must file and the due dates for the filings.
  g. Recording information (for example, the book and page number) for the Condominium Documents, such as the Declaration and all amendments, and the Drawings and all amendments, or, for homeowners associations, the Subdivision Restrictions and all amendments.
10. Financial Obligations. Has the Association met its financial planning obligations, such as adopting budgets and establishing reserves?
11. Accountant - Audits. Does the Association employ an accountant and does the accountant conduct audits?
12. Financial Safeguards. Has the Association implemented reasonable safeguards to protect its cash and investments? For example, consider:
  a. Two signers required for checks.
  b. Bank statements being mailed to someone other than the treasurer or being reviewed monthly by a person other than the treasurer.
  c. Are the people handling the funds properly bonded, when is the next premium due to keep the bond in force, and is someone other than the person bonded checking to make sure the premiums are paid in order to keep the bond in force?
13. Property Valuations. Does the Association monitor the real property tax valuations and determine whether the valuations should be contested? When is the deadline for contesting valuations?
14. Collection of Delinquent Assessments. Does the Association have a policy for the collection of delinquent assessments?
15. Rules. Does the Association have duly adopted rules and a policy for enforcing the rules?
16. Maintenance Obligations. Has the Association met its maintenance obligations?
17. Insurance Obligations. Has the Association met its obligation to obtain insurance and when was the last review conducted of the Associationís insurance obligations, the policies obtained, and the financial strength and reputation of the insurance companies?
18. Professional Assistance. Are the needs of the Association being met by the volunteer board and members, or is there a need to employ professionals?
19. Professional Assistance by Professionals. If someone is utilized or employed to perform services for the Association, are their services properly limited to the services they are qualified to perform? For example, is the Association relying upon a non-accountant for accounting advice and services? Is the Association relying upon a non-lawyer, whether a volunteer or a manager, for legal advice or legal services such as the preparation of legal documents? Is the Association relying upon a non-engineer for engineering advice and services?
20. Revisions to the Checklist.  Should revisions be made to the checklist to add additional items, to modify items, or to delete items?
21. Assign Responsibility.  If any item on the checklist needs follow up, who is responsible for making sure the matter is pursued to a satisfactory resolution?

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