Budgeting Interview

Budgeting Questions

1.     How often do you review your budget? Monthly, weekly, or yearly basis?

a.     Our budget is written as a monthly and annual budget and we review it each month for that month, then track year to date, and finally review year end.

2.     Who is involved in the process of reviewing the company budget?

a.     We have two or three accountants, two property managers, and a board of directors who each make reviews, suggestions, etc.  Most of the work is done by the manager but the final approval comes from the Board.

3.     If you are over budget, where are adjustments made first?

a.     We always have buffers in our budgets.  Areas such as capital improvements, or reserve funding are always buffers that can be adjusted as they are expenses against ourselves.

4.     How do you determine how much of your budget will be allotted to employee pay, products, or other expenses?

a.     All of our budgeting is based on prior year expenses and projected changes.  We do not have to worry about employee pay or products as these do not enter into our budget.  We have expenses that are out of our control (generally) and these have the greater number of checks on them during the year to ensure what expense is ever done in that line item is approved and necessary.

5.     Do you have a particular area that consistently causes your business to go over budget? Or do you consistently come in under or at budget?

a.     We are very lucky to have come in under budget for the past 6 years with this HOA.  We collect more than we budget for and spend less than we budget for.  We are actually quite consistent with that.

6.     If you have no problem areas of your budget, what would you say contributes most to being able to stay within your budget?

a.     Our unknown items such as snow removal and sprinkler repairs are the greatest concern for us each year.  We can never fully anticipate all that may come into play in those areas and try to be as conservative as possible to allow for such buffers.

7.     Are changes in the budget communicated to your employees and staff?

a.     Yes, any changes are discussed and thoroughly reviewed by the whole team every time.  Surprises are not good for any budget; communication is key to owning and maintaining a good budget.

First, allow me to set the stage.  I hate budgeting.  I am not good at it.  I wish I had more interest in it.  I just don't.  With that being said, I interviewed James at OA Services about the budget process and budgeting in general.  He creates the annual budget for a home owners association.  Holy cow, there is so much to know!  I learned a lot, and (especially considering I don't love budgeting anyway) I certainly respect and admire those who can do it and do it well.  It was a good experience, and sincerely understand now the importance of having a good budget and sticking to it well.  Sigh.  I'd better get a grip and try one out.  Good grief.