Treasurer and accountant relationship
Your treasurer keeps the books. Your accountant checks them. Here is where that line sits and why it should never move.
The treasurer keeps the association's financial records, prepares the annual budget with help from a CPA or the manager, and reports to the board. An accountant is an independent outside professional who provides one of three assurance levels, compilation, review, or audit, on those same records. The board should never let the treasurer audit its own books.
What the treasurer does
The treasurer keeps the books, year round. That means maintaining the association's financial records, tracking income and assessment payments, and paying approved bills. Most boards also lean on the treasurer to prepare the annual budget, commonly with a CPA or the management company, and to present financial reports to the board and membership.
Under Robert's Rules, the treasurer's core function is narrower than it sounds: custodian, not decision-maker.
"He acts as a banker, merely holding the funds deposited with him and paying them out on the order of the organization."
Source: Robert's Rules of Order Revised, Ch. XI, Westside Toastmasters (public domain edition)
The treasurer pays money out on the board's order, not on personal judgment. Spending decisions belong to the board; the treasurer executes them and keeps the record straight.
What the accountant adds
The accountant is not part of the board and does not report to the treasurer. The board hires an outside CPA to provide an independent look at the numbers the treasurer has been keeping all year. That outside look comes in three tiers.
| Service | What it means |
|---|---|
| Compilation | The CPA drafts financial statements from the association's own numbers. Lowest assurance. |
| Review | The CPA offers limited assurance without detailed testing of the records. |
| Audit | The CPA examines statements and supporting records in detail. Highest assurance. |
"an HOA audit provides the highest level of financial assurance. A Certified Public Accountant (CPA) examines the association's financial statements and supporting records in detail."
Source: HOA Audit vs Review vs Compilation: What Do You Need?, Hillcrest HOA Management
Which level your association needs, and how often, is a question for your state's HOA statute and your own bylaws, not a fixed rule. Check both before requesting a quote from a CPA.
Why the roles stay separate
A treasurer who prepares the books and then signs off on their own accuracy has reviewed nothing, only repeated it. That is the reason the two roles do not overlap, even when the treasurer is the most financially literate person on the board.
"board members should never attempt to audit their own association. This approach creates conflicts of interest."
Source: HOA Audit vs Review vs Compilation: What Do You Need?, Hillcrest HOA Management
The treasurer's report to the board is not a substitute for outside assurance, and outside assurance is not a substitute for the treasurer's own ongoing recordkeeping. Each supports the other; neither replaces it.
Check yourself
Answer before you read the explanation, recalling it is what makes it stick.
Your treasurer offers to save money by personally auditing the association's own books this year. What should the board do?
A lender reviewing the association for a bulk loan wants the highest level of financial assurance available. Which service should the board request?
The treasurer wants to pay a contractor a large invoice the board never discussed or approved. What should happen?
Sources
- Robert's Rules of Order Revised, Ch. XI, "The Officers and the Minutes", Westside Toastmasters (public domain edition)
- The Main Duties Of Your HOA Treasurer, HOA Management (HOAM)
- HOA Audit vs Review vs Compilation: What Do You Need?, Hillcrest HOA Management
Related elsewhere in the Academy
Board Roles
Next, see what the treasurer's day-to-day role looks like on its own.
Whether your association is required to get a compilation, review, or audit each year, and at what budget threshold, varies by state and by your bylaws.