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- 1 Community of property owners’ accounts: everything you need to know
Community of property owners’ accounts: everything you need to know
This article tells you what you need to know about the community’s accounts and offers advice for making the task easier.
Who’s responsible for the accounts in a community of property owners?
The property manager is responsible for the community’s accounts and for presenting them to the owners at general meetings. The property manager is the custodian of all invoices, receipts and service contracts. He or she must also provide this information to owners at their request, as described in Article 20.e) of the Spanish Horizontal Property Law (LPH).
Who can view the community accounts?
Owners are entitled to access community of property owners’ documentation as long as they have a valid reason. Article 20 of the LPH states that a property manager’s duties include: “acting, where appropriate, as secretary of general meetings and as custodian of the community’s documentation on behalf of the owners”.
But what does the Spanish Data Protection Agency say?
The property manager can feasibly show an interested owner the information without legal impediment where justified. However, in line with the Data Protection Act, general access to any documentation containing personal data is not permitted, except where the data is relevant, appropriate and limited to the purposes for which it is processed. Furthermore, the principle of proportionality always applies.
In rulings, the law deems that there is no obligation to disclose the accounts and invoices when the financial year in question is closed. This means that an owner cannot simply demand to see the accounting for financial years that have been approved and settled because only owners’ general meetings are permitted to inspect these accounts.
Article 19 of the LPH provides for the meeting minutes to be sent to the owners. The data minimisation principle applies. Therefore, the data provided should be limited to matters important to the information requested. To cite some examples, directories containing account numbers or payroll data for community workers, or data such as their registered addresses or political leanings, should not be shown, as they are not relevant to managing the community and such actions would breach the Data Protection Act due to an absence of proportionality.
How to present the community accounts
The owners’ general meeting is held once a year to approve the budgets and the accounts and explain the income and expenses for that year. Generally, a document is presented at the meeting highlighting income and expense items, specifying the financial and administrative transactions under each item, including:
- Net balance
- Current owners’ debts
- Unidentified bank transactions
- Forecast extraordinary expenses
What happens if the community budgets are not approved?
The owners will continue paying the same fees they have been paying to date. In this situation, either the budget is extended or an extraordinary general meeting is called at which the new budget is presented and voted on under the same conditions. A failure to approve the budget leaves the community in a complicated situation, as the property manager will not be able to issue receipts. Therefore, it is very important to approve the budgets, which act as the roadmap for your Mediterráneo property manager.
What happens if the community accounts are not approved?
A failure to approve the accounts usually happens when there are questions about the information provided by the property manager. Failure to approve the accounts could lead to legal action etc.