All in Good
Fun(d)
HOW AB-1101 LIMITS FUND TRANSFERS WITHOUT BOARD APPROVAL BY A.J. JAHANIAN, ESQ.
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ou may recall that, not too long ago, California legislators took steps to protect association finances by mandating greater oversight by boards of directors. Specifically, the Civil Code was revised in 2019 to require monthly
financial reviews and also prohibit any fund transfers or expenditures that exceed $10,000 or five percent (5%) of an association’s total combined reserve and operating account deposits (whichever is lower), without the prior written approval of the board. This meant that community association managers were required to obtain the written approval of the board first, before paying invoices, making expenditures, or otherwise transferring association monies in excess of the threshold.
4 The Law Journal Summer 2022 | cacm.org
