By: Beth Mulcahy, Esq.
Happy New Year! The new year often brings the desire to get organized and clean things out to start fresh! As a Board Member, how do you figure out what can go and what needs to be kept? It is a big decision, but don’t be discouraged, here are a few tips you should keep in mind as you sort through the pile of papers.
Remember, associations are recognized as legal entities, so certain records must be preserved for the proper period of time.
1. Retain financial records permanently
Accounting statements documenting the association’s history should be retained permanently. Tax forms and supporting documentation must be retained for at least seven years. Banking records for the past four or more years should be kept.
2. Your governing documents provide the corporate history
The articles of incorporation, bylaws, deeds, easements, contracts, rules and regulations and architectural guidelines are examples of the various records that must be retained throughout the existence of the community association. As updates are made, previous versions should be retained.
3. Association records should be maintained seven years
All of the documents that contain information concerning the activities of the association should be retained for at least seven years. Details concerning the actions taken are essential when questions arise.
- Employment records
- Expired contracts
- Expired leases
- Insurance documents
- Accident reports and settled claims
4. The business of the association should be retained permanently
These records should be properly organized so that information is easily found.
- Board meeting minutes
- Board actions
- Homeowner complaints
- Email history
5. Unit-ownership history should be retained in separate files
All documents for each unit must be retained in separate files. This historical record is important for the new owners when the unit transfers ownership.
- General correspondence with homeowners
- Work orders
- Complaints and violation notices
- Architectural modification requests
It is important to keep and retain records organized for easy retrieval, in a safe storage environment and in accordance with Arizona law. All of my firm’s (Mulcahy Law Firm, P.C.) attorneys are available to answer questions regarding records retention.