What financial information should strata managers provide to owners?

In NSW strata schemes, financial transparency is governed by the Strata Schemes Management Act 2015 (NSW).

1. Responsibility for providing financial information

The owners corporation is responsible for keeping financial records. In practice, this function is often carried out by the strata manager if it has been delegated to them under their agency agreement. Financial records must be maintained for at least seven years, and must include items such as invoices, receipts, bank statements and levy records.

Owners are entitled to inspect the records of the owners corporation, including financial records, by making a request through the strata manager or the secretary of the owners corporation.

In addition, financial statements are circulated to all owners with the notice of each Annual General Meeting (AGM). These statements summarise income, expenditure and balances in the scheme's funds. Depending on the size of the scheme or whether the owners choose to, an audit of past years' financial statements may also be required.

This means information such as:

• annual insurance premiums
• gardening or maintenance contracts
• invoices and payments made by the scheme

are all part of the strata records and can be inspected by an owner.

2. What happens to money that is not spent during the year?

Strata schemes operate two main funds:

• Administrative fund – for day-to-day expenses (cleaning, gardening, insurance, electricity, etc.).
• Capital works fund – for major repairs and long-term building works (roof replacement, balconies, lifts, etc.).

If money is not spent during the year, it remains in the relevant fund and is carried forward into the next financial period. It does not disappear or get returned to owners.

3. What happens if a major repair costs more than the annual levies?

If the cost of major works (for example, replacing deteriorated balconies) exceeds the funds available, the owners corporation generally has the following options:

1. Use accumulated funds in the capital works fund from previous years.
2. Raise a special levy on owners to cover the additional cost.
3. Borrow funds (less common but possible with approval).

If sufficient funds have accumulated from previous levies, they can absolutely be used for the work. If there is a shortfall, owners must contribute through a special levy approved at a general meeting.

4. Key point for new owners

Owners are not automatically sent every invoice or contract during the year. However, they have the legal right to inspect the strata records and see detailed financial information upon request.