Unit 2: The Governing Documents, Budget, and Financial Management

Question 1

The declaration, the articles of
incorporation, the bylaws, and the board
rules and regulations.

Answer 1

Governing Documents

Question 2

The document filed with the Florida
Department of State that creates the
community association and defines its
powers and responsibilities.

Answer 2

Articles of Incorporation

Question 3

A corporation in which no part of the
income or profit is distributable to its
members, directors, or officers

Answer 3

Corporation not for profit

Question 4

The code or codes of rules adopted for the
regulation or management of the affairs of
the corporation

Answer 4

Bylaws

Question 5

Informal or supplemental rules adopted by
the association board.

Answer 5

Rules and regulations

Question 6

The status that protects an individual under
the age of 18 years who is domiciled with a
parent or other person having legal
custody.

Answer 6

Familial status

Question 7

A person has a physical or mental impairment which substantially limits one or more major life activities, or he or she has a record of having, or is regarded as having, such physical or mental impairment.

Answer 7

Handicap

Question 8

The unit owner’s share of the money
required to pay the expenses of the
association.

Answer 8

Assessment

Question 9

The regular recurring expenses of the
association including such items as taxes,
insurance, maintenance, utilities,
administration and management.

Answer 9

Operating expenses

Question 10

Funds collected and set aside to cover non-
recurring capital expenditures and deferred
maintenance.

Answer 10

Reserves

Question 11

The document, prepared annually, that
reflects the estimated revenues, expenses,
and reserves schedule for the next fiscal
year and the estimated surplus or deficit as
of the end of the current fiscal year.

Answer 11

Budget

Question 12

Owners have petitioned the board because
the budget calls for new assessments for
operating expenses in excess of 115% of the
previous year.

Answer 12

Reconsideration

Question 13

All funds remaining at the end of the fiscal
year after all expenses have been paid.

Answer 13

Common surplus

Question 14

A one-time charge to pay for unexpected or
unforeseen association expenses.

Answer 14

Special Assessment

Question 15

A foreclosable claim against property to
secure payment of a debt, such as a
mortgage or association assessments.

Answer 15

Lien

Question 16

A certified document provided by the
association that states an owner’s current
assessment status.

Answer 16

Certificate of assessment / Estoppel
Certificate

Question 17

The type of financial report, also known
as a basic cash report, that applies to all
associations with fewer than 50 units and
all associations with annual revenues of
less than $150,000

Answer 17

Informal report

Question 18

The type of financial report that applies to
larger associations of 50 or more units
and $150,000 or more in revenue.

Answer 18

Formal report

Question 19

The most basic formal statement that
applies to associations with annual
revenues of $150,000 to $299,999.

Answer 19

Compiled report

Question 20

The more in-depth statement that applies
to associations with annual revenues of
$300,000 - $499,999.

Answer 20

Reviewed report

Question 21

The most in-depth statement that applies
to all associations with annual revenues
of $500,000 or more and all timeshares.

Answer 21

Audited report