Setting the budget | Owners Corporation Network Setting the budget

Generally the treasurer works with the strata manager to produce a budget to present to the owners corporation for approval at the annual general meeting. The best way to set a budget is to look at the past two year’s income and expenditure line item by line item. See the budget estimate vs the actual variances and determine which of those items have been similar to the past 2 years. Those items that vary significantly from year to year or from actual to estimate need to be understood with a bit more clarity before putting a budget estimate against the item. Also take into account previous one-off spends such as renovations or major breakdowns. Also be sure to include any upcoming proposed maintenance or known expenditure plans. Examine the 10 year sinking fund forecast for possible upcoming spend items (but do not follow it blindly). It is OK to put an in estimate of the possible dollars needed, and even include some contingency margin. Once the budget is set, then the levy estimates can also be set to ensure adequate funding and brought to owners for approval.