If you are a purchaser who is considering purchasing a Manhattan condo for sale in a small building, but the condominium board does not have an accountant prepare audited financial statements. Is there a requirement that condominium and co-op boards have accountants prepare audited financial statements?
No, there is no requirement that boards have accountants prepare audited financial statements. However, audited financial statements prepared by an accountant provide assurance that the financial statements fairly reflect the building’s financial position. Consequently, an audited financial statement will provide a prospective purchaser with confidence that they have an accurate picture of a building’s financial condition. Purchasers considering a condominium or co-op that does not have audited financials should proceed with caution when conducting their due diligence.
Important Tip: The audited financial statements for a Manhattan condominium or co-op are one of the due diligence items that your luxury Manhattan real estate broker will request from the seller or managing agent as soon as possible in order to expedite the transaction; and your closing attorney will advise you of the financial stability of the building financials.
Thanks to Neil B. Garfinkel, REBNY real estate counsel.