Strata management really is a job that requires a person to be a jack of all trades. In any one day a strata manager may have to;
1.Mediate between disputing neighbours.
2.Compare quotations for engagement of a consultant and make a recommendation.
3.Prepare a detailed meeting agenda.
4.Provide advice in relation to NBN connection.
5.Attend a hearing at NCAT.
6.Complete a scope of work for the cleaners.
8.Prepare budgets, and
9.On it goes.
It’s a fantastic, busy role. It’s not one usually undertaken by financial experts. Which is usually fine. A strata manager needs to understand the basics of accounting and budgeting, and that’s enough. But this isn’t a normal time.
The Covid-19 financial recession will leave between 10% – 40% of owners unable to pay levies. Perhaps more. The financial survival of the owner’s corporation, which really, is each owner, will depend on financial management. A budget will not suffice. At the very least, owners corporations will require detailed cash flow planning, expense reduction strategies, loan payment plans.
Strata Managers have always been charged with a serious responsibility to manage millions of dollars worth of asset. As well as, of course, actual cash belonging to others. The potential to get it wrong, to cause actual financial harm to others has always existed. However, the risk in getting wrong, during this recession is greater than we has experienced in decades. Financial management is not going to ‘part of the job’. For the next 6 months, or longer, it will be *the* job.
It’s important – crucial, that strata committees are supported by a strata manager with the financial planning skills to prepare a complete strategy for managing levy defaults during the recession. And if they don’t have those skills, experts will need to be engaged.