How to draw up the community's annual budget (without being an accountant)

The annual budget is more frightening than it is hard. In a small community it comes down to five figures and one afternoon.

1. Start from what you spent last year

The best prediction for next year is the year just gone. Add up the actual costs: cleaning, electricity, lift, insurance, water, maintenance contracts.

2. Add what you already know is coming

Is the cleaning contract going up? Is the lift inspection due? Are there works already approved? Put them in.

3. Safety margin

Add 5 to 10% for the unforeseen. A budget balanced to the last cent is a special levy waiting for a date.

4. Reserve fund

Check that you are keeping the legal 10% (and, if it was drawn on, that it is being topped back up).

5. Divide it among the flats

The total is split by ownership share (unless the by-laws say otherwise) and divided into 12 monthly payments.

At the meeting

Present three figures: what we spent, what we forecast, what the monthly charge comes to. The clearer the breakdown, the shorter the argument. The budget is approved by simple majority.