Condo Audit

[JimboJ]

The condo law requires an annual audit, and that the audit company should be appointed by a general meeting, not by the committee or management.  Does anyone know a good audit company who would actually expose embezzlement?

[KittenKong]

This might do better in the real estate sub-forum.

 

Yes, the choice of auditor should be voted at the AGM. Crooked building managements will then find a way to select another "friendly" auditor when they have something to hide. Many accounting companies will quote to do your audit and most seem to charge around the same amount.

 

Given the summary nature of Thai accounting I think you might find it hard to prove embezzlement regardless of who does the audit. I've seen better arithmetic on restaurant napkins.

[Delight]

Typical audit charges for a small condo are circa 12,000  Baht

 

The AGM tends to select the lowest cost provider

 

For that money they will only compile  data out based on data in.

 

There has been ,at the condo where I live,instances of Building managers being caught with their hand's in the till.

The internal auditors ,provided by our management company sussed them out.

 

They were duly dismissed -after monies were returned

 

Suspect that you would need to employ a company who specialises in this area.

 

 

 

 

[KittenKong]

58 minutes ago, Delight said:

There has been ,at the condo where I live,instances of Building managers being caught with their hand's in the till.

The internal auditors ,provided by our management company sussed them out.

 

Not likely to happen if it is the management company that has its hands in the till, even more so if the management company also acts as JPM.

[Delight]

3 hours ago, KittenKong said:

 

Not likely to happen if it is the management company that has its hands in the till, even more so if the management company also acts as JPM.

 

   That is not my experience.

A management company cherishes its reputation.

 If that fails -then so will its business.

 

The committee at the time of the 2 problems did not have a clue as to what was going on-why would they

 

It was the management companies internal processes that saved the day.

Suspect that they had little interest in protecting co -owner money

 

They were protecting themselves.

 

[KittenKong]

16 minutes ago, Delight said:

A management company cherishes its reputation.

 

Only if they actually have a good reputation. Some management companies dont.

[Delight]

12 hours ago, KittenKong said:

 

Only if they actually have a good reputation. Some management companies dont.

  

Caveat emptor

[KittenKong]

Not really. The management in a condo when you buy it could be quite decent, and have a good reputation. Subsequently they could leave for whatever reason and a complete bunch of clowns with no reputation could be brought in to replace them. And I know of buildings in which this has happened.

 

No amount of foresight can shield a buyer from that.

[Delight]

2 hours ago, KittenKong said:

Not really. The management in a condo when you buy it could be quite decent, and have a good reputation. Subsequently they could leave for whatever reason and a complete bunch of clowns with no reputation could be brought in to replace them. And I know of buildings in which this has happened.

 

No amount of foresight can shield a buyer from that.

 

 Its the management at head office (of the management company) that counts.

I agree -the local good guys can turn into local clowns.

 

We use QPM .

For certain they have their limitations.

However when it comes to money they are !st rate.

 

The committee need to review their decision with respect to  the management company on a regular basis.

 

QPM's skill with money management has ensured their continuity of employment.

 

Nothing is 100% . However careful selection and review  ,by the committee , will improve the odds for success

 

 

 

[KittenKong]

14 hours ago, Delight said:

 

 Its the management at head office (of the management company) that counts.

I agree -the local good guys can turn into local clowns.

.............

The committee need to review their decision with respect to  the management company on a regular basis.

.............

Nothing is 100% . However careful selection and review  ,by the committee , will improve the odds for success

 

Not all management companies have a head office: some are just "one man bands" who operate from home. And if you have the misfortune to end up with one like that then there will be no external control at all.

 

And for the committee to be of any use would require them to be in some way competent. This is not always the case. In fact, rather like politicians, in my experience those who seek to be on a building committee are frequently people who have no useful skill at all but do have an ulterior motive of feathering their own nest or in some way massaging their ego, and get elected for the talk they talk rather than the walk they walk. This can all be very bad news for a building, and it cant really be foreseen by a potential buyer.

[Delight]

5 hours ago, KittenKong said:

 

Not all management companies have a head office: some are just "one man bands" who operate from home. And if you have the misfortune to end up with one like that then there will be no external control at all.ing, and it cant really be foreseen 

  You pay peanuts -you get monkeys

[JimboJ]

To sum up.  No one knows of an independent audit company who could be relied upon to expose embezzlement. 

It is no use relying on the management company, since they are in the best position to be dishonest, and need to be checked up on by an independent audit.

So it is necessary to pay for an audit to conform to the law, but it is just decoration,  and may even mislead owners into a false sense of security.

Every owner must do their own audit, relying on the committee/management to supply the relevant documents, which they have no legal obligation to do.

[KittenKong]

24 minutes ago, JimboJ said:

To sum up.  No one knows of an independent audit company who could be relied upon to expose embezzlement. 

It is no use relying on the management company, since they are in the best position to be dishonest, and need to be checked up on by an independent audit.

So it is necessary to pay for an audit to conform to the law, but it is just decoration,  and may even mislead owners into a false sense of security.

Every owner must do their own audit, relying on the committee/management to supply the relevant documents, which they have no legal obligation to do.

 

It shouldn't be too hard to spot missing cash in most buildings as the annual income from common fees etc is known, and the outgoings can be accounted for.

 

About the only figures that can be manipulated easily are goods or services that are sold like perhaps wifi cards, key cards, renovation fees or technician/cleaning services, and, of course, overpricing and kickbacks on goods and services that are bought in, or the theft of those goods. From what I have seen all of these forms of theft/cheating are absolutely endemic here and I suspect that anyone who says it doesnt happen in his building has merely been outsmarted. Or maybe I am just unlucky and all the Thai buildings that I havent seen are havens of honesty and transparency.

 

The annual audit as required by law is indeed a complete sham.

 

As far as I know the committee and management are required to produce documents when requested. However if they dont do so it will probably prove very hard to make them.