Section 78 deals with accounts opened and into which funds are held by owners corporations. These funds must be deposited into an account established in an authorised deposit-taking institution, in the name of the owners corporation. The section does not apply where a strata manager has been appointed and to whom that duty has been delegated.
Funds collected and controlled are trust funds whether by the owners corporations; companies; or delegated to a strata manager. This must be done with the upmost of care and the records be available to all interested parties, such as owners, or in the case of company title, shareholders.In order to get the figure right relating to contributions for the administrative and capital works funds,
section 79 provides that estimates be prepared which set out the actual and expected expenditure. The two funds are quite different. The administrative fund covers such things the cost of day to day maintenance of common property; insurance; and recurrent expenses. The capital works funds are accumulated for expenditure to:· paint and repair the common property;
· acquire, renew and replace personal property;
· renew and replace fixtures and fittings that are part of common property;
· replace or repair common property; and
· meet other expenses of a capital nature
(major repairs or improvements to common property).When estimating for either fund, the owners corporation must have and take into account, a statement of the existing financial situation of the strata scheme, including an estimate of receipts and payments.To assist this task, the legislation provides an owners corporation also take into account the 10 year capital works fund.If you live in a large scheme (comprising more than 100 lots) the estimate must include:· specific amounts in relation to each item in respect of which money is to be spent or expected to be spent in the period until the next annual general meeting; and
· a note as to any difference and why there is difference between the estimates and the 10 year plan (
Section 80).