What to look for in a financial professional to guide your year-end review.

This article outlines updated considerations for HOA boards in 2026, with practical guidance on what to look for when hiring an auditor or CPA and how to ensure the relationship supports long term stability rather than adding stress.

As 2026 approaches, HOA boards are facing increasing financial complexity. Rising insurance premiums, higher operating costs, stricter regulatory oversight, and growing homeowner expectations have made financial transparency more important than ever. One of the most significant decisions a board can make each year is selecting the right auditor or CPA to review the association’s finances.

An effective year end financial review does more than satisfy governing document requirements. It helps boards understand their financial position, identify risks, confirm compliance, and make informed decisions for the year ahead. Choosing the right financial professional is critical to that process.

Why the Auditor or CPA Relationship Matters More in 2026

HOA finances are under closer scrutiny than in past years. Homeowners are more engaged and more likely to request financial records. Lenders and insurers increasingly review association financials before approving loans or coverage. State laws continue to evolve, often increasing reporting and disclosure requirements.

A qualified auditor or CPA serves as an independent safeguard. They help confirm that financial statements are accurate, properly classified, and aligned with legal and accounting standards. Just as important, they provide boards with clarity and confidence during a time when financial missteps can quickly escalate into disputes or compliance issues.

In 2026, boards should view this role as advisory and protective, not merely procedural.

Understanding the Difference Between an Audit, Review, and Compilation

Before selecting a financial professional, boards should clearly understand what level of service the association needs. Governing documents and state laws often dictate the required level of financial review.

An audit provides the highest level of assurance. It involves detailed testing of transactions, internal controls, and supporting documentation. Audits are typically required for larger associations or those with higher annual revenue.

A review offers limited assurance. The CPA analyzes financial statements and makes inquiries but does not test transactions in depth.

A compilation is the most basic level. Financial statements are prepared based on information provided by management, with no assurance provided.

Boards should confirm requirements early and ensure candidates are qualified to perform the specific service needed.

Prioritize Direct HOA Experience

Not all CPAs or auditors understand the unique structure of community associations. HOA accounting differs significantly from for-profit businesses in areas such as fund accounting, reserve contributions, assessment income, and restricted funds.

When interviewing candidates, boards should ask specific questions about HOA experience, including:

• The number of community associations they currently serve
• Familiarity with reserve accounting and fund segregation
• Experience with state specific HOA statutes and reporting requirements
• Understanding of common HOA financial challenges such as special assessments and deferred maintenance

A professional who regularly works with HOAs will be better equipped to identify issues early and explain them clearly to board members.

Look for Strong Communication Skills

Technical knowledge alone is not enough. Boards benefit most from financial professionals who can explain findings in plain language and answer questions without creating confusion or alarm.

During the selection process, evaluate how clearly candidates communicate. Are they willing to attend board meetings to review results. Do they provide written summaries that highlight key points. Are they responsive and approachable when questions arise.

In 2026, transparency and homeowner confidence depend heavily on clear financial communication. A CPA who can translate numbers into practical insight is a valuable asset.

Assess Independence and Objectivity

Independence is essential, particularly for audits. The auditor or CPA should have no involvement in day-to-day financial management, bookkeeping, or decision making for the association.

Boards should confirm that candidates do not provide conflicting services that could compromise objectivity. A strong professional will clearly outline their independence policies and explain how they maintain ethical standards.

This independence protects both the board and the association, especially if financial decisions are later questioned.

Evaluate Knowledge of Current Regulations and Standards

Financial and regulatory standards continue to evolve. In recent years, changes in accounting guidance, tax treatment, and disclosure requirements have affected many associations.

In 2026, boards should confirm that their CPA or auditor stays current on:

• State HOA laws and reporting obligations
• IRS requirements for associations filing Form 1120 or 1120 H
• Updates to accounting standards affecting nonprofit and quasi nonprofit entities
• Best practices for financial disclosures and reserve reporting

A knowledgeable professional should be able to discuss recent changes and explain how they may impact the association.

Consider Their Approach to Risk and Internal Controls

A year-end review is not just about confirming balances. It is also an opportunity to identify weaknesses in internal controls and financial processes.

Strong auditors and CPAs take a proactive approach. They assess how funds are handled, how approvals are documented, and how financial responsibilities are segregated. When issues are identified, they provide constructive recommendations rather than criticism.

Boards should ask candidates how they approach internal controls and whether they offer guidance on improving financial practices. This insight can help prevent errors, fraud, and future disputes.

Understand Fees and Scope Clearly

Cost is always a consideration, but it should not be the primary deciding factor. The lowest fee does not always provide the best value, especially if the scope of work is unclear or limited.

Boards should request detailed proposals that outline:

• The specific services included
• The timeline for completion
• Any additional fees for meetings, revisions, or supplemental reports
• Expectations for board and management involvement

Clear agreements reduce misunderstandings and help boards plan effectively for the year end process.

Confirm Availability and Responsiveness

Timing matters. Year-end reviews often coincide with budget preparation, annual meetings, and tax filings. Delays can create stress and disrupt planning.

Boards should confirm availability well in advance and ask about typical turnaround times. It is also reasonable to ask how quickly questions are addressed during and after the review.

A reliable financial professional respects deadlines and understands the broader calendar of HOA responsibilities.

Partnering With Management for a Smoother Process

When an association works with professional management, coordination between the management company and the auditor or CPA is essential. Clear communication ensures records are organized, questions are addressed efficiently, and the review proceeds smoothly.

Boards benefit from selecting professionals who are comfortable collaborating with management while maintaining independence. This balance supports accuracy and efficiency without blurring roles.

Making the Decision With Long Term Stability in Mind

Hiring an auditor or CPA should not be viewed as a one-year transaction. A consistent relationship allows the professional to develop familiarity with the association’s financial history, challenges, and goals.

In 2026, boards are best served by choosing financial professionals who demonstrate reliability, clarity, and a long-term perspective. The right partner helps boards fulfill their fiduciary duties, build homeowner trust, and plan confidently for the future.

A thoughtful selection process reduces risk, supports compliance, and reinforces the association’s commitment to sound governance. By focusing on experience, communication, independence, and proactive guidance, HOA boards can ensure their year-end financial review strengthens the community rather than creating uncertainty.

Contact Silvercreek for more information.