An Orlando CPA’s Guide to Compilations, Reviews, and Audits
As Florida homeowners’ associations (HOAs) prepare for year-end and plan ahead for the upcoming fiscal year, many boards and property managers are asking the same question: What exactly does Florida law now require when it comes to financial reporting?
Recent statutory updates and increased enforcement focus have made it clear that financial transparency and accountability are no longer optional for HOAs—they are a legal obligation. Depending on the size and revenue of the association, Florida law requires HOAs to prepare compiled, reviewed, or audited financial statements, each with a different level of CPA involvement and assurance.
As a CPA firm based in Orlando, Florida, we work closely with HOA boards, management companies, and legal counsel to ensure associations not only remain compliant, but also use financial reporting as a governance and planning tool rather than a last-minute compliance exercise.
Florida HOA Financial Reporting Requirements: A Statutory Overview
Florida homeowners’ associations are governed by Florida Statutes §720.303(7), which establishes tiered financial reporting requirements based primarily on annual revenues and, in certain cases, the number of parcels within the association.
In general, the statute requires the following:
In addition, associations with 1,000 parcels or more are required to obtain audited financial statements regardless of revenue. These reports must generally be completed and made available to members within 90 days after fiscal year-end, unless governing documents specify a different timeline.
Why This Law Matters for HOA Boards
From a governance standpoint, these requirements are not simply administrative. They are designed to:
The level of reporting required directly affects cost, timing, and the depth of financial insight available to the board. Understanding these differences early allows associations to plan appropriately and avoid compliance issues.
Common Questions from HOA Board Members
Given the complexity of the statute, HOA board members often have practical questions about how these requirements apply to their specific community. Below are answers to the most common questions we receive.
What financial statements is our HOA required to prepare?
Florida HOAs must prepare one of four types of financial reports annually: a cash receipts and expenditures report, compiled financial statements, reviewed financial statements, or audited financial statements. The required level depends on annual revenues and, in some cases, the number of parcels in the association.
How do we determine whether we need a compilation, review, or audit?
The determination is based primarily on total annual revenues from the prior fiscal year. Boards should review year-end financials early and confirm thresholds with a CPA to ensure the correct level of reporting is planned well in advance of statutory deadlines.
Can homeowners request a higher level of financial reporting?
Yes. Florida law allows 20% or more of parcel owners to petition the board to vote on increasing the level of financial reporting—for example, moving from a compilation to a review or from a review to an audit. This mechanism exists to protect homeowner interests and enhance transparency when warranted.
Are audits always required for large associations?
Yes. Associations with 1,000 parcels or more are required to obtain audited financial statements regardless of annual revenue. Larger communities are subject to heightened oversight due to their financial complexity and fiduciary responsibilities.
Can an HOA vote to reduce its reporting requirement to save costs?
In limited situations, Florida law allows associations to vote to prepare a lower level of financial reporting than otherwise required. However, this option is subject to strict voting requirements and generally cannot be used in consecutive years. Boards should consult with a CPA or legal counsel before pursuing this option.
What is the practical difference between a compilation, review, and audit?
Each level carries different costs, timelines, and levels of scrutiny.
What are the risks of not complying with Florida’s HOA reporting requirements?
Noncompliance can lead to homeowner disputes, difficulty obtaining financing or insurance, challenges during unit sales, and potential exposure for board members related to fiduciary duties. Timely and accurate reporting helps mitigate these risks.
When should our HOA engage a CPA for financial reporting?
Best practice is to engage a CPA before or immediately after fiscal year-end. Early engagement allows time to resolve accounting issues, ensure records are complete, and meet statutory deadlines without unnecessary pressure.
Why work with a CPA who specializes in HOAs?
HOA accounting involves unique considerations such as assessments, reserves, statutory disclosures, and member reporting obligations. A CPA experienced in Florida HOA work can provide compliance assurance while also offering insights that support better long-term financial planning.
Final Thoughts: Turning Compliance Into Good Governance
Florida’s HOA financial reporting requirements reflect a broader emphasis on transparency, accountability, and fiduciary responsibility. While the law establishes minimum standards, proactive boards view financial reporting as an opportunity—not just an obligation.
By understanding your statutory requirements and partnering with a CPA experienced in Florida HOA compilations, reviews, and audits, your association can remain compliant, build trust with homeowners, and position itself for long-term financial stability.
If your HOA is preparing for its next reporting cycle or needs guidance interpreting these requirements, our Orlando-based CPA team is here to help.
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