This is a good idea. It leads to transparency and when residents go to sell their apts they can have an electronic copy on hand.

The real problem is the definition of financial statements. We get an annual financial statement which is really bare bones but meets accounting standards. We have no idea as to the actual line items that created the debit or credit. In other words, we have cumulative expenses but not specific ones and have been told repeatedly that this is all we are entitled to receive. In reading BCL, I believe that is true. If anyone can get me something specific that would require the board/management company to give more in depth financial information to shareholders, I would be extremely grateful. Amazingly, even the members of the financial committee do not get specifics. Keep in mind that our annual budget is over 44 MILLION dollars.

With a budget of over $44M, the monthly report for your Co-op is probably huge. It is also a very imprecise and often incomplete instant snapshot of your Co-op financial situation and does not clearly articulate the overall fiscal health of the corporation.

Very large expenses may appear to be way out of line for what you would expect, but may, in fact, represent payments made on a quarterly, semi-annually, or annual basis. This extended time interval would most likely not be noted for the line item. Sometime information may not be received by the managing agent in time for inclusion in a monthly report, so two or more apparently duplicate entries and payments are seen on the next month's report. Sometimes after a review is made by the Co-op's treasurer, changes are made to way an item is accounted for or classified in the GL. This would render the original report inaccurate. Item descriptions may contain abbreviations or terms of art that are not readily apparent or subject to misinterpretation by someone not familiar with Co-op financial details.

The annual audited financial statement is really the governing document for evaluating how fiscally healthy your co-op is. It is reviewed and legally certified by an independent outside auditor to be a true and accurate representation of the corporation's finances. Misrepresentations made in the certified financial statement may raise to the level of fraud. All information must be included before the statement can be certified, and any omissions must be noted. This is why banks, mortgage lenders, purchasers, etc always request a copy of the financial statement and not copies of the monthly reports. It is like the difference between eating a fully prepared meal vs ingesting the ingredients individually.

What you say is all well and good. However, just looking at the year end statement does not answer specific questions. Example, our country club runs a great many parties which are subsudised, yet, the room will only hold 5% of the members, we cannot learn the yearly amount of subsidy and understand our mandatory dues will go up. Landscaping is done and then redone and then done again, not just in keeping with seasons, but in general, yet, no known dollar amount. Extensive expensive improvements to golf course, no dollar amount, fewer than 10% shareholder members and illegal outside membership. I could go on and on, but you get the point. Is there anywhere that I might not be familiar with which would give us more insight into the financial running of our co op. I am well versed in co op ownership and its' legalities, I am looking for something obscure that might have been used by others.

i’ve learned from both accountants and lawyers involved in co-op issues that the audited financial statement is given to the accounting firm which, without an independent examination, signs off on the information the managing agent gives them. so much for ‘auditing’.
shareholders need to chip in to pay a forensic accountant in order to get a true picture.

Hi,

Financial statements are not just for shareholders. Buyers, appraisers, vendors and banks all require the information on a regular basis. My building includes the last three years of financial statements on our website for all to see here:

http://www.naborsapts.org/purchasers/key-documents/

(We also have prior years on the site if you know how to change the year in the address line.)

In my opinion, if your Board is ashamed of the annual financial statements, you have a much bigger problem.

Steve

i beleive that legislation should be passed that enables any shareholder to access the monthly finacial statements online,The spreadsheets. It could be pw protected,and any also editing would onky be enanled for the managment company. Many of these sytems show when and who logged on ,if a unique pw is provided to shareholders.
This way any fraud or embezzelemt, finacial imprierties could be caught early on, if a shareholder was keeping an eye on things.
In this co-op the board didnt even know the name of the new bank, never performs the system of checks and balances that are routinely posted on the coop magazines. The board president dosnt convey to other board members when there has been a problem until months latter, maybe never. I know this from 2 previous board members that have resigned or moved.All my attempts to see the financials as stated in out proprietary lease are ignored, as are the shareholder 624b requests. AG doesnt care, , And unless i am missing something, my attorney fees to bring a court case to get what is in the proprietary lease would come out of my pocket. This co-op ownership, when dealing with a criminal family could be the biggest housing fraud pulled on the NYS people

EscapeFromYonkers - You should not have to go the course by yourself. Enlist the aid of all the other shareholders who feel as you do. Not only will you have more eyes and hands working on the problem, but you will be able to spread the cost of legal services and other activities among a broader base.

Good luck!

i had a letter published in the nytimes concerning the fact that approx 62% of the apartments are ower/occupied and the board and management, are telling the buyers,shareholders and banks that the coop is 90% owner occupied. I posted copied of the letter/article around the bldg before the annual meeting. The response from the times was that this was criminal, mortgage fraud and contact the DA. I did , but i got to fill out another one of their damn forms. Of course they are not in a open format, bit in adobe, so impossible to fill out via computer unless one has the $1000 abode program . Tired of these stupid forms that cant be filled out via pc and printed and mailed.
The president with all board members and managing agent present at annual meeting passed out a sheet rebuking the article which i informed him, was my letter, the first 2 or 3 apartments that he had labeled as owner occupied were never owner occupied or, one has nor been occupied by anyone since 1985.
he was calling apartment that were not so-called unsold shares from conversion in 1983 as owner occupied. I informed him that owner occupied means the share-owner occupies it as a primary residence. not once or twice a year, or not their son occupies it. I also informed the board again that the treasured who they list as living in the building have never lived in the building. the board members refuse to provide contact info. None of the other share-owners present opened their mouths. i have been callng attention to this for the last 4 years.
I cant see how the managing agent who is is real estate agent can sit there as an agent of the management company and participate in this fraud.
the management agent refuses to accept my faxes, which have corrections to minutes, usually involving the self dealing and fraud. In the [ast he refused to forward my faxes to the board members,only the pres who will do whatever he feels like to alter the message. The finance's are not watched at all, I wouls prefer to ger an attorney before i file with the DA concerning the mortgage fraud, but haven't found any in Westchester. Lot more fraud and inside dealing too
The original shareholders when we went coop were great, but this president has been selling only to people who will never occupy and turned the building into a rental again, plus no sublease fees are collected. since they say that it is legal to let adult children occupy an apartment the parent purchased and never moved in.
Seem he has no fiduciary responsibility for the building, he also has not lived here in over 8 years, but states he does. Self deals by giving his sons his primo parling spaces, while his son rents an apartment, and therefore is last and subleasing is not allowed for parking.
Every angle of board operation is self dealing or turning the building into a rental.
AG is totally worthless as this is their ballgame. They want me to spend my money to do their job. I am ready to play media highlight on how coop ownership is a total scam if you get a management company and board in bed
i couldn't believe when the few shareholders sat there and believed an apartment not occupied for 38 years was owner occupied.
We have not received the annual audit statement which is suppose to be provided in march. Of course the share-owners don't seem to care .
I also have the president on tape at an annual meeting 3 years ago saying he will dealing 4 times, when i told him he was self dealing.
Media time,Call the AG office out, and make them print on large print on every coop contract that the AG officef the BCL are violated.
believe me i write the AG office and let them know how dysfunctional they are,

i also write the NY senators to let them know that the AG office will not do anything with coop fraud,self dealing. And there seems to be zero protection for shareholders if you have a crooked board and same management company.
lawyers are not beating my door down, and being disabled, i cant move to the same type of location i need on my income .

the wonderful ny senator, liz kreuger, has a bill before the ny legislature that would create an office to advocate for co-op shareholders. if we pressure the other senators in albany to pass the bill, we will gain strength as shareholders dealing with incompetent or corrupt board members and managing agents. it’s worth calling ms.kreuger's office to ask what we can do to get her bill passed.

thanks , i will follow up with her and my state senator Andrea Stewart Cousins. I believe she is already a supporter of the bill, i can write up a cliff notes of the violations the board+ management company is working together to keep the shareholders in the dark, and make the shareholders a cash cow for the management company,provide almost zero service, or put off maintenance so that they get a big contract which has the normal goodies for the agents, and now board members.
Many people including board members believe that insurance protects the shareholder from fraud, embezzlement. I am sure the managing agent told them so.
The board sat in total silence as the president went on his BS spin that apartments that had not been occupied since 1985, apartments that were vacant ,apartments that were never occupied by the share-owners,only their child, apartments where the owner had moved to Florida and comes back 2 a year, his apartment that is vacant, since they no longer live in this area, are all owner occupied, and that they are not committing mortgage fraud. The managing agent who is also a real estate agent sat there silently.
Plus the fact that we had never heard about this unsold share memos and cases. I see a real lack of fiduciary duty to the coop. I am sure the other 20 buildings they mange the boards do not allow this ratio of non owner occupied, it goes completely against the whole concept of co-op ownership.

the managing agents are often more corrupt than board members. this is without doubt the situation in my co-op. some board members are too busy with their careers so they leave building business to the managing agent or, in some cases, board members are just naive.
there is a lot of passivity in my building too. most shareholders have busy lives and don’t want to get involved in what they pass off as ‘politics’.

The monthly report will show which shareholders are paying sublease fee's and garage parking fees. It may be possible to find discrepancy, such as people who should be paying the sublease fee's but are not, the same with parking. You may notice that a board member is paying for one space but has three. This will not show up on the yearly annual report.

I have a situation where they are in cahoots, and most likely the quid pro quo is a daily function of their lives, Since the AG refuses to take action to uphold the laws of the state, they are running wild, unless one has a lot of money they want to front for a lawyer and more importantly , will if found in violation of all the self dealing ,fraud, corruotion BCL's will the shareholder be reimbursed for all the legal expenses, or in my case be bought out so i can have peace of mind and not worry about embezzelement since the board does not perform any check and ballances, that have been published in the co-op mags. Meanwhile even though my prop lease states i can view the fincials during normal businees hours at the mangment company, they refuse me , zero transparancy is the name of the game and we know what that means.
I did write the AG office and my state senator concerning the information published on the AG co-op site that was incorrect , the memo from 1987 concerning holder of unsold shares, and the discreapacys between the info that the AG says need to be provided for the shareholder names in BCL 624b,think B.
and the other stufff such as affaidavits that many cooperation lawyers state must be provided, by the shareholder, somehow i thing if you went into court with the AG's requirement page, you could make your affadavit right there and then. Sounds like a pure delaying and hoping you go away BS manuevar and the coop lawyer should be levied a fine.,

the managing agents are often more corrupt than board members. this is without doubt the situation in my co-op. some board members are too busy with their careers so they leave building business to the managing agent or, in some cases, board members are just naive.
there is a lot of passivity in my building too. most shareholders have busy lives and don’t want to get involved in what they pass off as ‘politics’.

As a board treasurer, I am interested in what information or insight Co-op shareholders feel they would derive from receiving copies of the *monthly* management reports. Remember that the monthly report is different than the annual financial statement.

I fully understand and absolutely support the right of every shareholder to automatically receive the audited annual financial statement after it has been approved by the board and signed off by the accounting firm. The monthly management reports are very different animals, and I would like to understand what the perception is of what they contain and what value they could provide.

Thanks!

The monthly reports shows the shareholders what the board is spending on a monthly basis. It shows that bill are being paid and it also shows that the books are in balance. Your monthly report ending balance should match your ending bank statement balance and the shareholders need to see this info so know that the books are in order.