Financial Statements

In British Columbia, strata financial statements are the annual income-and-expense reports prepared by a strata corporation summarizing actual revenues and expenditures for the fiscal year compared against the approved budget, along with the closing balances of the contingency reserve fund (CRF) and any special-levy accounts. They are governed by the Strata Property Act (SBC 1998, c. 43) and its Regulation, which require the strata corporation to maintain these records and present them to owners. Financial statements are part of the formal record-keeping obligations every strata corporation must fulfil.

Under the Strata Property Act (SBC 1998, c. 43), the strata corporation must present financial statements to owners at the annual general meeting (AGM). The statements must cover the fiscal year just completed and allow owners to compare actual revenues and expenses against the budget that was previously approved. Presenting financial statements at the AGM is a mandatory statutory obligation, not an optional practice.

Whether a BC strata corporation's financial statements must be internally prepared, reviewed, or audited by a professional accountant is not mandated by a single universal rule under the Strata Property Act (SBC 1998, c. 43); instead, it is determined by the strata corporation's bylaws or by a resolution passed by the owners. Strata corporations should consult their registered bylaws and, where needed, the current BC Government or BCFSA guidance to understand what level of financial scrutiny applies to them. Owners may pass a resolution at a general meeting to require an audit or review if the bylaws do not already specify one.

Yes. When a strata lot is being sold in British Columbia, the strata corporation is required under the Strata Property Act (SBC 1998, c. 43) to provide a Form B Information Certificate, and financial statements form one of the key documents included in that package. A prospective purchaser or their agent typically requests the Form B package as part of due diligence so they can review the strata's financial health before completing the purchase. Reviewing the financial statements helps buyers assess whether the strata corporation is managing its funds prudently.

The contingency reserve fund (CRF) balance shown in a BC strata corporation's financial statements represents the accumulated funds set aside for future repair and replacement of common property, common assets, and parts of a strata lot that the strata corporation is responsible for maintaining. Under the Strata Property Act (SBC 1998, c. 43) and its Regulation, strata corporations are required to contribute to the CRF each year and to disclose the CRF closing balance in their financial statements. A healthy CRF balance is an important indicator of the strata's long-term financial preparedness.

Yes. Under the Strata Property Act (SBC 1998, c. 43), financial statements are among the records that the strata corporation must make available for inspection by owners and, in some circumstances, other persons entitled to request them. An owner may request access to strata records, including financial statements, and the strata corporation is required to provide access within the timeframes set out in the Act and its Regulation. The strata corporation may charge a reasonable fee for copies, as permitted under the Regulation.

When a BC strata corporation passes a special levy to fund a specific project or expense, the Strata Property Act (SBC 1998, c. 43) requires that money collected be held in a separate account and tracked distinctly from operating and CRF funds. The financial statements must disclose the opening balance, amounts collected, expenditures, and closing balance of each special-levy account so owners have a transparent accounting of how those funds were used. This disclosure requirement ensures owners can verify that special-levy money was spent for its designated purpose.

A real estate licensee licensed under the Real Estate Services Act (RESA) and regulated by the British Columbia Financial Services Authority (BCFSA) has a duty to act in a client's best interests, which includes drawing the client's attention to documents such as strata financial statements that are material to the purchase decision. A licensee can help a buyer understand what the financial statements contain and identify potential concerns, such as a low CRF balance or significant budget deficits, but should not provide legal or accounting advice. For a detailed financial analysis, buyers may wish to engage a professional accountant familiar with strata finances.

Yes. BC strata financial statements are specifically intended to compare actual revenues and expenditures for the completed fiscal year against the budget that was approved by the owners for that year, allowing owners to see where the strata corporation over- or under-spent. This budget-versus-actual comparison is a core component of the annual financial statements as contemplated under the Strata Property Act (SBC 1998, c. 43). Any significant variances between budget and actuals may indicate issues the strata council should address in the upcoming year's budget.

No. BC strata financial statements report on the strata corporation's revenues and expenses at a corporate level and do not identify individual owners' personal financial information, such as whether a particular unit is in arrears. Personal information about individual owners collected by the strata corporation is subject to the Personal Information Protection Act (PIPA) of BC, which governs how such information may be collected, used, and disclosed. Strata corporations that wish to disclose owner-specific financial information, such as arrears lists, should consult their obligations under PIPA before doing so.