1. (1) Basis of accounting. The financial statements required by Sections 719.104(4)(b) and 719.301(4), F.S., as well as financial statements voluntarily prepared in lieu of a financial report as provided in Section 719.104(4), F.S., shall be prepared on the accrual basis using fund accounting in accordance with generally accepted accounting principles. Reviewed financial statements shall be reviewed in accordance with standards for accounting and review services and audited financial statements shall be audited in accordance with generally accepted auditing standards. Reviews and audits of an association’s financial statements shall be performed by an independent certified public accountant licensed by the Florida Board of Accountancy. As used in this rule the terms “generally accepted accounting principles”, “standards for accounting and review services”, and “generally accepted auditing standards” shall have the same meaning as set forth in Chapter 61H1-20, F.A.C.

2. (2) Components. The financial statements required by Sections 719.104(4)(b) and 719.301(4)(c), F.S., shall at a minimum include the following components:

   1. (a) Accountant’s or Auditor’s Report;
   2. (b) Balance Sheet;
   3. (c) Statement of Revenues and Expenses;
   4. (d) Statement of Changes in Fund Balances;
   5. (e) Statement of Cash Flows, direct method; and
   6. (f) Notes to Financial Statements.

3. (3) Disclosure requirements. The financial statements required by Sections 719.104(4)(b) and 719.301(4)(c), F.S., shall contain the following disclosures within the financial statements, notes, or supplementary information:

   1. (a) The following reserve disclosures shall be made regardless of whether reserves have been waived for the fiscal period covered by the financial statements:

      1. The beginning balance in each reserve account as of the beginning of the fiscal period covered by the financial statements;

      2. The amount of assessments and other additions to each reserve account including authorized transfers from other reserve accounts;

      3. The amount expended or removed from each reserve account, including authorized transfers to other reserve accounts;

      4. The ending balance in each reserve account as of the end of the fiscal period covered by the financial statements;

      5. The manner by which reserve items were estimated, the date the estimates were last made, the cooperative association's policies for allocating reserve fund interest, and whether reserves have been waived during the period covered by the financial statements; and,

      6. If the developer has established converter reserves pursuant to Section 719.618(1), F.S., each converter reserve account shall be identified and include the disclosures required by this rule.

   2. (b) The method by which income and expenses were allocated to the unit owners;
   3. (c) The specific purpose or purposes of any special assessments to unit owners pursuant to Section 719.108(9), F.S., and the amount of each special assessment and the disposition of the funds collected; and

   4. (d) If a guarantee pursuant to Section 719.108(8), F.S., existed at any time during the fiscal year, the financial statements shall disclose the following:

      1. The period of time covered by the guarantee;

      2. The amount of common expenses incurred during the guarantee period;

      3. The amount of assessments charged to the non-developer unit owners during the guarantee period;

      4. The amount of the developer's payments pursuant to the guarantee; and

      5. Any financial obligation due to or from the developer resulting from the guarantee.

4. (4) Developer assessments. All financial reports and financial statements required by Chapter 719, F.S., shall disclose the assessment revenues from the developer separately from that of the non-developer unit owners.

5. (5) Financial reports required by Section 719.104(4)(a), F.S. The financial report required by Section 719.104(4)(a), F.S., shall meet the following requirements:

   1. (a) The report shall be prepared on a cash basis;
   2. (b) The report shall include the receipts and expenditures listed in Section 719.104(4)(a), F.S.; and
   3. (c) The report shall contain the reserve disclosures required by Rule 61B-76.006(3)(a), F.A.C.
   4. (d) The report shall include the special assessment disclosure required by paragraph 61B-76.006(3)(c), F.A.C.
6. (6) Minutes. The minutes of the association shall reflect the number of votes cast by the membership to waive the requirement for audited, reviewed, or compiled financial statements and the type of financial reporting that the association will be preparing and disseminating to the membership.

Rulemaking Authority 719.104(4)(a), 719.501(1)(f), (j) FS. Law Implemented 719.104(4), 719.501(1)(j) FS. History–New 12-20-95, Amended 1-19-97, 3-19-15.