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Typical variances in KCA income, expenses; but mid-year report looks good

Thanks to the relatively mild winter, snow removal — a budget buster in recent years — is well under budget this year.

Thank you to all of our neighbors who continue to make their assessment payments on time.  As a result our receivable rate is just 1.33%, among the lowest of like HOA’s.  The industry’s highest preferred rate is 5% and we are well below that.  This has a positive impact on our cash flow and is a testament to our community’s commitment to maintaining high standards.

The following numbers reflect the financial position of the Kentlands Citizens Assembly as of May 31, 2017.

  • Year to Date Income $1,029,161
  • Year to Date Expenses $ 961,882
  • Net Income Year to Date$ 67,279

The budget and financial statements of the Assembly are available at the club house should anyone be interested in exploring our finances further  (our Document Library is going through a renovation and is temporarily offline), the $1,029,161 of  year-to-date income is $8,089.68 below the budgeted amount of $ 1,037,251.  I would just like to point out a few more year-to-date variances, which we expect to be over budget at this time.

The year-to-date expense total of $961,882 is $74,314 under the budgeted amount of $1,1036,197. While we try to anticipate the seasonality of the expenses and spread them appropriately throughout the year, all of the expenses cannot be accurately predicted month to month, hence variances are to be expected.  The majority of this variance is expected to be temporary with the balances zeroed out by year end, however several other expenses will have long-term variances, which we are aware of at this time.

  • Telephone, line item #6050, is over budget by $2,135. When we switched our phone system to a VOIP-based system, the savings and costs estimated were not realized as such we have estimated that this item will have a negative $5,500 variance to budget by to year end.
  • Single Family and Town House Trash, line item #6035, is over budget by $3088. When compiling the 2017 budget, we did not factor in the fuel surcharge and taxes, the dollar amount of which was unspecified in the contract.  These charges add approximately $500 a month to the contract, which will result in a negative $6000 variance to budget by year end.

On the positive side our Snow Removal Services costs, line item #6442 are under budget which will, provided snow fall at the end of 2017 is in line with budgeted expectations, cover these variances easily.

While there are many other expenses which are currently under budget, I will not list them here.  Suffice it to say that we expect the majority of these to zero out by the end of the year and to have a neutral effect on the budget.

Should we believe additional expenses will be over budget for the year, we will be sure to advise you when those variances are expected to negatively impact our financials for the year.



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