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Condominiums in Alberta › Internal Controls

Banking Controls

Banking controls are a strong assurance against fraud.

In the United States, the Federal Home Loan Mortgage Corporation (Freddie Mac) recommends the following controls for reduced insurance premiums:

  • Separate accounts for the working account and the reserve account are maintained by the owners association or the management company. The depository institution in which funds are deposited sends copies of the monthly account statements directly to the owners association.
  • Separate records and accounts are maintained for each owners association using the management company’s services. The management company does not have the authority to draw checks on or to transfer funds from the reserve account of the owners association.
  • Two or more members of the board of directors must sign any checks drafted against the reserve account.