RESERVE FUND FORECAST

A 10 Year  plan

What is a Reserve Fund Forecast?

Also known as a 10 Year Plan or Sinking Funds Forecast, a Reserve Fund Forecast is a detailed cost schedule that ensures property owners allow for sufficient financial reserves to maintain the building. Most importantly, these clear financial reports minimise the future risk of insufficient funds, creating a safety net for both the body corporate and the building itself.

If you are a Strata Owner in Western Australia, the new and improved Strata Title Reform states that every Strata company with 10 or more lots or a replacement cost of $5 million or more, must establish a 10 year plan that sets out;

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The common and personal property of the strata company that is anticipated to require maintenance, repair, renewal or replacement
The period covered by the plan
A report about the condition of the covered items and the anticipated costs for maintenance, repairs, renewal or replacement
A strata company must prepare a budget forecast for each financial year to its annual general meeting

Find out more about our Reserve Fund Forecast below or call us for a chat on 089424 5800.

Alternatively, you can send us an email for an obligation free quotation.

What is included in a Rawlinsons Reserve Fund Forecast?

A Rawlinson’s (W.A.)'s 10 Year Plan covers expenditure of a capital or non-recurrent nature including periodic replacement of major capital items (including plant and equipment), and other spending that may reasonably be required for the safe operation and upkeep of the building. It does not include expenditure on capital improvements. The reports will include an escalated cash flow forecast for the 10 year plan.

How is a Reserve Fund Forecast different to an Administration Fund?

The cost of maintenance contract items are normally included within the administration fund, therefore they are excluded from the Reserve Fund Forecast.

These items include, but are not limited to:

Garden maintenance
Cleaning
Testing of services
Minor plumbing works
Minor works that are maintenance in nature

Is the report easy to understand?

Our comprehensive report will explain how we have estimated the expected life of the items, the included and excluded items and a summary of costings.

What time period does the Forecast cover?

Rawlinsons (W.A.)'s reports can detail the expected yearly costs for up to 15 years (sample below), however, we recommend the Reserve Fund Forecast be reviewed annually to include any changes arising from extraordinary expenditure, inflation, local market factors and the general building condition.

A small sample of an annual average costs summary is included here, please note, our reports are comprehensive and the items per year are details in full within our forecasts. If you wish to look at a full sample, please contact us today.

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