Body Corporate fees for 'accounting package'?

[Rolf]

I recently received the invitation to the annual AGM for the body corporate of a 2brm unit I own.
The local real estate agent office is managing our BC, which is all fine. It's a block of 6 units and there is usually not much business to discuss at the AGM, so it's all fairly simple. However, with the invitation was an interesting letter: Due to the recent changes to the Unit Titles Act they now say that they require a different accounting package and they are asking the 6 owners to front up with a one-off payment for this package??
It's a total of $45 pr. unit so not exactly big bucks but it's the principle that bothers me. What if they want a new coffee machine next, is that the owner's problem too...? It seems very unprofessional to me, but this is the only BC I'm involved with so maybe others can shed some light on what I should expect?

Thanks,
Rolf

[essence]

Okay, I know nothing about Body Corps or their fees.

Due to the recent changes to the Unit Titles Act they now say that they require a different accounting package

I'm guessing that your Body Corp isn't the only one they are managing - are they going to ask each and every Body Corp to "donate".

I would've thought a new accounting package would be a cost of doing business for an accounting firm and something that they will absorb into their costs and claim in the next tax return.

[Keithw]

Seems outragous, simply a way of increasing their fees. Its like a builder charging you extra because he needs a new saw or the lawnmower man charging you for a new mower.
The principle is wrong, but the reality is that it is a cost of business, & eventually you will end up paying it in future fees, whether it is hidden as overhead or listed specifically as they have done, so really it is a bad PR exercise.

Just the same as us landlords will be passing on the cost of any tax changes to the tenants- the end user, the Body Corp Secretary is doing the same. In this case either you are the end user, as an owner occupier, or you will eventually pass it down in rent increase to your tenant.

[Aston]

I have properties in 2 separate Body Corporates and very closely involved with the management of one. I have not been asked for a contribution to purchase software.

This is an expense of the Accountancy/Management Company administering your Body Corporate and they should not be asking you to pay for their software.

They may choose to increase their fees to your BC on the basis that their expenses are increasing but then you also have the option of getting quotes from other BC Managers.

I suggest that you attend the meeting and challenge them on this matter. I know that you’re only in a small BC but a bit of lobbying may help also.

[Rolf]

Originally Posted by essence

I'm guessing that your Body Corp isn't the only one they are managing - are they going to ask each and every Body Corp to "donate".

I was thinking that as well, I can't imagine our BC is the only one they've got.

Originally Posted by Keithw

Seems outragous, simply a way of increasing their fees. Its like a builder charging you extra because he needs a new saw or the lawnmower man charging you for a new mower.
The principle is wrong, but the reality is that it is a cost of business, & eventually you will end up paying it in future fees, whether it is hidden as overhead or listed specifically as they have done, so really it is a bad PR exercise.

Sure, it will be passed on one way or the other. The principle is what bothers me, it is an unprofessional way of doing things.

Originally Posted by Aston

This is an expense of the Accountancy/Management Company administering your Body Corporate and they should not be asking you to pay for their software.

They may choose to increase their fees to your BC on the basis that their expenses are increasing but then you also have the option of getting quotes from other BC Managers.

I suggest that you attend the meeting and challenge them on this matter. I know that you’re only in a small BC but a bit of lobbying may help also.

Yes, I always attend and usually it's a quick easy meeting. I will definitely challenge them on this one though.

Thanks.

[Rolf]

Something else I was thinking of: How much is there really to manage with a 6 unit BC? Each owner is charged a single annual payment which is then spent on insurance, mowing of common grounds, security light power bill, sinking fund and then the rest is BC management fee. All up maybe 1 hours work in a spreadsheet, annually, to make it nice and well presented.

Now, I do all my accounting myself for a fair number of properties, in Excel. Just for this unit I have 52 weekly rent payments a year to manage, plus the odd repair etc. Still it's all very easy to do, I use the same template year after year.
So with just 6 annual payments and regular lawnmowing, why do they need an accounting package??

Again, I could understand if they were managing 100's of BCs, but in that case the cost would also be spread out, so it's all a bit puzzling. Seems like they are trying to rip us off I'd say, but we'll see at the meeting.