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How an engagement works

Preparation decides how the engagement goes.

Some associations receive a finished report five or six weeks after fieldwork begins. Others are still chasing a bank confirmation three months later. The difference is rarely the CPA. It is whether the engagement letter was signed before year end, whether the books were closed before fieldwork, and whether the documents arrived in one organized delivery.

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A December 31 year end

The schedule, planned back from the 90-day deadline.

Written for boards, managers, and bookkeepers. The proposal confirms the dates for each engagement.

  1. Engage before year endEngagement letter signed and returnedOctober to November, board
  2. Close the booksReconciled, coded to funds, ledger closedJanuary, manager or bookkeeper
  3. Deliver the document packageOne delivery against the request listJanuary to February, manager
  4. FieldworkQuestions raised as they come upFebruary, CPA
  5. Draft, representation letter, final reportBoard reviews; designated officers signFebruary to March, CPA and board
  6. Report delivered to membersWithin 21 days of completionApril, association
  • Board and manager
  • CPA
  • Delivery window
  • Dec 31: fiscal year end
  • Mar 31: report complete (90 days)
  • Apr 30: HOA delivery limit (120 days)

Dates shown for a December 31, 2026 year end. A condominium association has until 180 days after year end to deliver the report. Bylaws may set an earlier date.

Stage by stage

Who does what, and when.

  1. October to November

    Engage the CPA before year end

    Sign and return the engagement letter before December 31. The work is then planned into the schedule, and the manager knows who is performing it. Associations that wait until February join the back of a long line.

  2. January

    Close the year completely

    Every bank account reconciled, receivable and payable agings tied to the balance sheet, transactions coded to operating or reserve funds, and the general ledger closed. Confirm that bank signature cards were updated for any signer changes during the year.

  3. January to February

    Deliver the document package

    One organized delivery against the request list, rather than a trickle of files after fieldwork has begun.

  4. February

    Fieldwork

    Reconciling accounts, testing transactions, reading minutes, and raising questions as they come up instead of saving them for the end.

  5. February to March

    Draft, representation letter, final report

    The board reviews the draft statements and any proposed adjustments. The officers we designate, typically the president and treasurer along with the manager, sign the representation letter. The final report cannot be released without it.

  6. By March 31, delivered in April

    Report issued and delivered to members

    The report is complete within 90 days of year end. Members receive a copy, or a notice that one is available at no charge, within 21 days of completion, and no later than 120 days after year end for an HOA or 180 days for a condominium.

The request list

Sent in full, at the start.

The complete list comes with the engagement letter. It is organized in two parts, by who holds the records, so the manager can gather everything at once.

Part one

Board and governance records

Usually held by the board, the manager, or association counsel.

  • Declaration, articles of incorporation, bylaws, and amendments
  • Board and membership meeting minutes for the year and through fieldwork
  • The adopted budget and any special assessment resolutions
  • Management agreement and major service contracts
  • Insurance policies in force during the year
  • Reserve study, and for condominiums the structural integrity reserve study and any milestone inspection reports
  • Loan agreements and lines of credit
  • Contact details for association counsel

Part two

The accounting package

From the manager or the bookkeeper.

  • Year-end trial balance and general ledger
  • Statements and reconciliations for every bank and investment account
  • Assessments receivable aging and delinquency report, tied to the balance sheet
  • Prepaid assessments detail
  • Accounts payable aging, with invoices for unpaid bills
  • Reserve activity by component, and the interfund balance reconciliation
  • Loan statements at year end
  • Prior-year financial statements and tax return

A summary of the categories. The list for each engagement is specific to the association and the level of service.

Six avoidable delays

What stalls an engagement, and the fix for each.

Every one is preventable, and most are visible from the manager's desk before fieldwork starts.

DelayWhy it slows the workThe fix
Engagement letter signed late December 31 year ends reach every CPA at once. An association that signs in February gets February's remaining capacity. Approve and return the engagement letter before the fiscal year ends.
Books kept on a cash basis Year-end statements are prepared on the accrual basis. Cash-basis books need adjusting entries for assessments receivable, prepaid assessments, and unpaid bills, and every adjustment adds questions. Record receivables and payables monthly, or at minimum at year end before the package goes out.
Unreconciled accounts A reconciliation that does not tie to both the bank statement and the balance sheet means the difference has to be chased. Reconcile every account every month, and have someone who does not handle cash review it.
Missing invoices and approvals Sampled expenses need a matching invoice and evidence of approval. Each missing document becomes an open item. File invoices as they are paid. Record board approval of large or over-budget spending in the minutes.
Operating and reserve activity tangled together Reserve expenses paid from operating and never reimbursed, or transfers without a paper trail, force the interfund balance to be rebuilt. Keep separate bank accounts, code every transaction to a fund, and reconcile interfund balances monthly.
Representation letter left unsigned The final report cannot be released without it. Hesitation at the finish adds weeks. Put it on a board agenda in advance. New directors can sign: the letter's assertions are made to the best of the signer's knowledge and belief.

For the board

Questions to ask every month.

The easiest year-end engagements happen at associations that never need a January catch-up. Put these to the monthly financial package.

  • Does every bank reconciliation tie to both the bank statement and the balance sheet?
  • Are operating and reserve funds stated separately, in separate accounts?
  • Does the delinquency report tie to the balance sheet, and is the collection policy being followed?
  • Does the payables aging include all known unpaid bills?
  • Were all reserve expenditures, including change orders, approved by the board and recorded in the minutes?
  • Was any over-budget spending approved and documented?
  • Has the association borrowed from reserves for operating needs, and if so, is there a documented repayment plan?
  • Do loan balances tie to the lender's statements?

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Tell us about the association.

Send the association's total annual revenue, fiscal year end, and the level of report it filed last year. We will confirm the level Florida law requires and send a fixed-fee proposal.

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