Question:
When can the special reserve assessment be transferred to the reserve operating bank account? When invoiced or only when collected?
– Brian
Answer:
Hi Brian,
An HOA should have two bank accounts: an operating account and a reserve account. Transferring the assessment to the reserve account generally happens upon collection. If you’re referring to accounting entries, however, it depends on what accounting method you’re using. For the cash method, you record the entry when the money changes hands (when you receive or collect the sum). For the accrual method, you record the entry when the assessment is earned (when you invoice the sum).
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