Pacific Crest Reserve's
Reserve Study Tutorial                                                                                                           
 

 

 

 

 

1-866-618-7764  Toll Free 
360-588-9956        Local

Washington's Bill 6215

 What is a Reserve Study? FACTs - what you should know about Reserve Studies HOME
Actual  Bill

Reserve Study Terms

 Tutorial Who we are - Contact Us

Tutorial Introduction

Every condo/homeowner association should exercise a plan to repair and replace major common area components like roofs, siding, and decks. Because the board has a fiduciary duty to manage association funds and property, a replacement reserve budget is very important. Not only does this information supplement the annual pro forma operating budget in providing owners with financial information; the reserve study is also an important management information tool as the association strives to balance and optimize long-term property values and costs for the membership.

 A Reserve Study is comprised of two parts: the physical analysis and the financial analysis. The physical analysis section refers to the current conditions and estimated replacement cost for the individual common area components. The financial analysis section includes information on the current status of the reserve fund and recommendations for the future life of the fund.

How Do Reserves Fit into the Overall Financial Plan?

The reserves are an important part of the association’s annual pro forma operating budget. The replacement reserves relate to association budgeting in two important ways:

▪ The pro forma operating budget will include planned replacement reserve funding and the accrual-basis expense for the year.

▪ The reserve estimates depend on assumptions about the association’s maintenance program, and maintenance expense is a part of the operations budget.

It is important that association members understand the difference between operations and replacement reserve activities. Boards should establish policy to distinguish between reserve expenses (funded from the replacement reserve account) and operating expenses (funded through the non-reserve operating budget).

Lets get started on the tutorial Click on each step

 

Physical Analysis

Comp. Life & Cost

Finance Analysis

Funding Strategy


 

Calculating Balance
 
 

 

 

Contact Information
 Pacific Crest Reserves, LLC
Anacortes, Washington 98221

Toll Free 1-866-618-7764 or Local 360-588-9956
http://www.PacCrestReserves.com

 

 

Send mail to rick@paccrestreserves.com  with questions or comments about this web site.
Copyright © 2008 Pacific Crest Reserves, LLC
Last modified: 9/16/08 

Pacific Crest Reserves is a locally owned company providing reserve studies, commercial inspection and condo inspections in the Mount Vernon, Wa. area. Pacific Crest Reserves is licensed by Washington State and employs Reserve Analysts that meet or exceed the requirements set by Community Association Institute.  Pacific Crest Reserves conducts their Washington State building  inspections according to the National Association of Home Inspectors Standards of Practice & Code of Ethics. Our professional standards provide a minimum guideline for conducting a Anacortes Washington Reserve Study.