Reserve planning represents one of the most critical yet frequently misunderstood aspects of community association financial management.

An outdated reserve study quietly distorts the financial picture: replacement costs lag market reality, component condition assumptions stop matching observed wear, and the percent-funded calculation that reassured the board two years ago no longer reflects what the next major project will cost.

Every Florida community association builds two budgets each year: an operating budget for day-to-day expenses and a reserve budget for major repairs and replacements over the long term. The interaction between them, and the Florida statutes governing reserve funding, drives the assessment level your association sets.

Florida community associations must file annual financial reports, but the level of independent review your board needs varies.