09/09/2019 at 10:35 pm #41964
Hi all, I’m an owner in a scheme of less the 30 units in NSW
At last AGM 2018 when Appointment of Auditor was discussed and resolved, the Secretary/ Treasurer nominated himself to perform the Audit. He had done so the previous 2 years for free!!. At the time I pointed out that this could be a conflict of interest as it is my understanding that a Treasurer cannot audit their own records. But the Treasurer claimed it would be expensive and so convinced everyone to appoint him as Auditor again. So it was resolved that he Audit the accounts.
As there had been cash out of pocket expenses paid to himself without receipts the previous year I didn’t think this was wise. There was a resolution passed under financial matters that was resolved that cash payments- no payments made without receipt or invoices
The Financial records just released again pre AGM 2019 document again that out of pocked cash payment to himself had occurred again despite a resolution prohibiting it. But to add insult , the Treasurer charged the OC $1000 for Auditing and this was not approved at a committee meeting . It came as a shock to committee members who didn’t see any invoice. On investigation it was not a formal invoice, just a quick email to strata manager from Treasurer. Also there is no structure to report. Its is a brief half page and it just refers to what a great job he does as Treasurer ?
Thus it appears that the Treasurer is perhaps not qualified to perform an Audit ?
Thus my questions 1) What are the standards of auditing of Strata Records ?
2) What are the qualifications required to be an Auditor and to charge for this.
3) Is it against the law or any act to claim to be an Auditor if you are not qualified to do so ? can you report it ?
10/09/2019 at 11:50 am #41987
- This topic was modified 1 week, 5 days ago by Jimmy-T.
Dear me. For a start, an executive committee member cannot be paid without approval of the owners at the AGM. So unless there was a resolution to pay the Secretary/Treasure at the AGM which was approved by the owners, the payment is illegal. This type of approval has to be done after the services have been provided.
Note the Committee does not have the power to approve such a payment.
Section 95 of the Act provides that if an audit is carried out, it must be in accordance with Australian Accounting Standards.
From the information you have provided, whatever it is that this person has provided is not an “audit”. An audit is conducted by an independent third party who is qualified to carry out the work.
I am not sure if it is illegal to hold oneself out as an auditor, but I would be telling the Committee member to hand the money back, and if you want to have an audit, get someone qualified to do it. It may also be a good idea to remove this person from their position as Secretary/Treasurer and tell the manager they must not pay any invoices or expenses without sign-off from the Committee.11/09/2019 at 4:50 pm #42080
It is the role of the treasurer to keep track of the books and make sure all is in order. The role of an audit is to reassure the owners corporation that the treasurer has not made any mistake, accidentally or deliberately, or failed to pick up some mistake by the managing agent. I agree that it is not an audit unless it is an independent third party.