Audit Services

Case Study: The Financial Audit – Empowering Condominium Committees with Clarity and Control Client: A large, well-established Condominium Juristic Person in Phuket, managing over 200 residential units and extensive common facilities. Industry: Property Management / Real Estate Services: Financial Statement Audit, Risk Advisory

Client:

Condominium

Website:

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Date:

November 22, 2020

Category:

Audit Service

We helped ABC Company move beyond the mere act of compliance. We helped them build a foundation of trust and a platform for sustainable, long-term growth.

01. Сhallenge

The condominium’s committee, comprised of co-owners, required their annual audit to ensure transparency and accountability for all residents. While day-to-day operations were running, the committee was concerned about rising maintenance costs and lacked the financial expertise to deeply scrutinize the building’s complex financial activities. They needed an auditor who could not only verify the accounts but also provide expert guidance on whether the co-owners’ funds were being managed effectively and securely.

02. Solutions

SiriAudit.com approached the engagement understanding that an audit for a Juristic Person is about providing assurance to an entire community. Our process was designed to deliver both compliance and clarity.

Meticulous Audit Execution: Our audit team conducted a thorough examination of the financial statements, focusing on key areas such as the collection of common area fees, management of the sinking fund, and payments to service contractors, ensuring strict compliance with Thai accounting standards.
The Value-Add: The Management Letter: Our core value was delivered through a comprehensive Management Letter, presented directly to the condominium committee. This document translated complex audit findings into clear business language, highlighting operational risks and providing a practical roadmap for improvement.

Key findings included:

Finding: Weaknesses in Common Area Fee (CAM Fee) Collection We identified an inconsistent process for tracking and following up on overdue CAM fees, with no standardized policy for applying late-payment penalties.
- Identified Risk: Significant risk of revenue loss, negatively impacting cash flow for essential services like security and cleaning. This could lead to a future need to increase fees for all residents.
- Recommendation: Implement a formal, automated tracking system for overdue payments. Establish a standardized and fair policy for late payment penalties and follow-up procedures, to be approved by the committee and communicated to all co-owners.
Finding: Lack of Competitive Bidding for Maintenance Contracts Major repair and maintenance contracts were often renewed with incumbent suppliers without a formal competitive bidding process.
- Identified Risk: High risk of overpaying for services and receiving suboptimal quality of work, directly impacting the co-owners’ funds.
- Recommendation: Institute a mandatory competitive bidding process for all contracts exceeding a specified threshold (e.g., THB 100,000). Require at least three formal quotations and a documented review by the committee before any contract is signed or renewed.

03. Results

Our value-driven audit empowered the committee with the tools and knowledge to govern more effectively on behalf of all residents.

Complete Transparency and Assurance: The client received an unqualified audit opinion, providing full confidence and transparency to all co-owners regarding the management of their collective funds.
Significant Cost Savings: The new competitive bidding policy led to estimated annual cost savings of 15% on major maintenance contracts, allowing funds to be reallocated to other building improvements.
Secure Long-Term Funding: The sinking fund was restructured according to the new investment policy, safeguarding and optimizing the fund to ensure the long-term financial health of the condominium.

Let’s Build a Foundation of Trust and Growth Together

“The team at Siri Audit provided us with the clarity and confidence we desperately needed. Their Management Letter was invaluable—it went beyond the numbers and gave us a practical action plan to manage our co-owners’ funds more responsibly and efficiently. This was more than an audit; it was an essential advisory service for our community.”

– Condominium Committee Chairperson

Contact us today for a confidential consultation to discover how Siri Audit’s expert services can become your ultimate competitive advantage.