How to Read Strata Minutes and Financial Statements: A Realistic Example

Strata documents are easier to follow when you can watch one building's numbers move from one page to the next. So this guide follows a single building instead of explaining everything in general terms.

The building

Our example building is a 40-lot apartment block in NSW, built in 2004.

• Total unit entitlement for the scheme: 10,000
• You own Lot 12, a two-bedroom unit with a unit entitlement of 250
• Financial year: 1 July to 30 June
• The accounts are prepared on an accrual basis and the scheme is registered for GST

It's September 2026 and the AGM pack has just arrived by email. It's a 64-page PDF holding:

1. The notice and agenda for this year's AGM
2. The minutes of last year's AGM (September 2025)
3. Minutes of committee meetings held during the year
4. Audited financial statements for the year ended 30 June 2026
5. The proposed budget for 2026-27
6. The 10-year capital works fund plan
7. The insurance schedule and the strata manager's commission disclosure

You'll also want three documents that aren't in the pack: the general ledger, the bank reconciliation and the arrears report. Ask the strata manager for them in writing. Under the Act you're entitled to inspect the scheme's records, and a small fee set by regulation can apply.

Start with last year's minutes. They tell you what the money was supposed to do this year.

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Step 1: Last year's AGM minutes

Here's the part of our example building's 2025 AGM minutes that matters.

What each part tells you

Attendance and quorum. In NSW a general meeting has a quorum when at least 25% of the people entitled to vote are present in person or by proxy, or when those present hold at least 25% of the total unit entitlement. Here 15 of 40 lots is 37.5%, so the meeting could make decisions.

Proxies. In a scheme with more than 20 lots, one person can hold proxies for no more than 5% of the lots. In our example building that means two each. Lot 5 holds two and Lot 30 holds one, so that's fine. If one owner had turned up holding eight proxies, the votes cast on the extra proxies wouldn't count.

Count the votes against the attendance. Fifteen lots were present or represented. Motion 6 had 13 for and 2 against, which is 15. Motion 7 had 12, 2 and 1, which is also 15. If a motion had 20 votes for, something would be wrong with the record.

Motion 1, confirming the minutes. This is your one chance to object to the record of the earlier meeting. Once minutes are confirmed, they're very hard to challenge.

Motion 2, "adopted" versus "received". Our example building adopted its statements. Some managers word this motion as "received", which only acknowledges that the statements exist. Either way, it doesn't stop you questioning them later.

Motion 4, commissions. NSW strata managing agents must disclose the commissions they receive at each AGM. $4,120 from the insurance broker is a common type. "Noted" means nobody voted on anything.

Motion 6, the budget. This motion sets your levies for the year, and only owners at a general meeting can pass it. If you ever see committee minutes saying the committee "resolved to increase levies" or "raised a special levy", ask how. Those decisions belong to the general meeting.

Your share works like this:

• Admin fund: $182,000 × 250 ÷ 10,000 = $4,550
• Capital works fund: $90,000 × 250 ÷ 10,000 = $2,250
• Total $6,800 a year, or $1,700 a quarter

If a levy isn't paid within one month of its due date, NSW law charges simple interest of 10% a year on the overdue amount. The owners corporation can choose to waive it.

Motion 7, the painting. This is the motion you'll check the accounts against. Write down four things:

1. The amount: $186,400.
2. The fund: capital works.
3. The committee can approve variations up to 10%, which is $18,640, without asking owners again.
4. Anything above $205,040 ($186,400 plus $18,640) needs a new general meeting decision.

Motion 9, the special resolution. In NSW a special resolution fails if more than 25% of the value of the votes cast is against it. Value means unit entitlement. Against: 1,350 out of a total of 3,800 is 35.5%, so the motion lost, even though twice as many lots voted for it as against.

An ordinary resolution is simpler. It passes with more than half the votes cast, one vote per lot, unless someone demands a poll and the votes are counted by unit entitlement instead.

General business. "The committee will look into it" is not a decision. A general meeting can't make binding decisions on matters that weren't on the agenda. If the gym noise is still a problem, it needs a proper motion at the next meeting.

The committee minutes

Two entries from this year's committee minutes matter for the accounts:

$16,900 is under the $18,640 limit, so the variation was within the committee's authority. The painting total is now $203,300. The legal fees will show up in the admin fund, and now you know why.

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Step 2: The chart of accounts

Every dollar in the accounts is coded to an account. The full list of accounts is the chart of accounts. It isn't usually printed in the pack, but every line in the statements and the budget is one of these accounts. Here is our example building's, shortened.

What you need from this table:

The code decides which fund pays. The admin fund pays running costs. The capital works fund saves for big, predictable work such as painting, roofs and lifts. When someone codes a gutter replacement to 2310 instead of 6020, the admin fund takes a hit it wasn't budgeted for, and next year's admin levy goes up to cover it. You'll see exactly that in our example building in Step 5.

"Agreed services" and "additional services" are both management fees. NSW management agreements split the manager's work into agreed services, covered by the base fee, and additional services, charged on top. Add 2020 and 2030 together to see what the building pays its manager.

2310 "Repairs: general" is the catch-all. Anything nobody bothered to classify ends up here. Keep an eye on it.

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Step 3: The admin fund income and expenditure statement

This page shows what came in and went out of the admin fund in 2025-26, next to the budget owners adopted at Motion 6.

Reading it

Bottom line first. The budget expected a $25,700 surplus. The fund ran a $4,510 deficit instead. That's a $30,210 gap, and you want to know where it came from.

Then find the lines that explain the gap. Four lines account for it.

Those four add up to $35,750, which is more than the whole gap. Higher income and slightly lower electricity and other costs make up the difference.

Income has clues too. Interest on overdue levies was $1,240 against a budget of $500. That's the 10% interest on late levies, so more owners than expected paid late. Recoveries from owners of $3,800 is money the scheme spent and then charged back to individual owners. Check it was collected.

Management fees, totalled. $18,700 + $6,950 = $25,650 this year. Last year it was $20,900. Management costs went up 23% while the base fee went up 5%.

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Step 4: The capital works fund and the balance sheet

Capital works income and expenditure

A deficit here is fine. The fund was saving for years so it could pay for the painting, and this is the year it paid. What matters is that painting cost $203,300, matching Motion 7 plus the approved variation, and that it came out of the right fund.

Capital works balance sheet at 30 June 2026

The income and expenditure statement covers a whole year. The balance sheet is a snapshot of one day.

What each line means:

• Cash at bank and term deposit, $344,300. Money in the scheme's accounts. This has to match the bank statements on 30 June exactly. The bank reconciliation in Step 6 checks that.
• Levies in arrears, $9,000. The capital works share of levies owners haven't paid. It counts as an asset, but you can't pay a contractor with it.
• Levies paid in advance, $4,500. Owners who paid the 1 July instalment early. The cash is in the bank but it belongs to next year, so it's a liability.
• Creditors, $41,000. Bills received but not yet paid. In our example building this is the painter's final progress claim, received on 24 June and paid in July. Because the accounts are on an accrual basis, it's already counted in the $203,300 even though the cash hadn't gone out yet.
• Owners' funds, $307,800. What the fund is worth once everything owed both ways is counted. The money it can spend today is $344,300 less $45,500, which is $298,800.

The roll-forward check

Last year's balance sheet showed capital works owners' funds of $412,100. Add this year's result:

$412,100 − $104,300 = $307,800

That matches. If it didn't, money would have moved in or out of the fund without going through income or expenses, usually by a journal entry or a transfer to the admin fund. Ask about any gap.

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Step 5: The general ledger

The general ledger lists every transaction, account by account. Here's part of account 2310 "Repairs: general", the one that came in $15,400 over budget.

Three entries in this extract need a question.

The three $1,950 plumbing invoices on the same day. The management agreement lets the manager approve repairs up to $2,000 without the committee. Three invoices for the same job, each just under the limit, add up to $5,850. Either the job was split to avoid committee approval, or there's a good reason. Ask.

$6,200 to replace the east side gutters. Replacing a building element is capital works. It belongs in 6020, not 2310. Moving it would cut the admin overspend by $6,200 and weaken the case for the admin levy increase in Step 8.

$5,000, "Works as per quote". Real invoices are rarely an exact round number, and the description doesn't say what was done or where. Ask for the invoice and the quote.

The other entries look ordinary. You don't need to question every line, only the ones that look wrong.

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Step 6: The bank reconciliation

A bank reconciliation checks that the accounts match the bank on the same date. Here's the admin fund's for 30 June 2026.

That's a clean reconciliation. The only item is a payment that cleared the bank three days later, which is normal timing.

Warning signs would be an unexplained difference that isn't zero, an uncleared payment that's months old, or the same unexplained amount carried forward month after month. Also check that the account is in the name of the owners corporation, or is the manager's trust account for the building, and that it isn't mixed with the manager's own money.

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Step 7: The arrears report

About a third of this is capital works levies, which is the $9,000 on the balance sheet. The rest is admin fund levies.

A quarterly levy for an average lot is $1,700, so Lot 21 is eight quarters, or two years, behind. The committee has already engaged lawyers, which explains the legal fees. Lot 30 is five quarters behind, and the minutes don't mention it. Your question is what's being done about Lot 30.

Arrears details are about other owners' finances. Use them to ask the committee questions, and don't pass them around.

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Step 8: The proposed budget for 2026-27

Now you can read the motion this AGM will vote on, with the full year's results in front of you. Some lines from the proposed admin budget:

The proposed capital works budget is $90,000 again.

For Lot 12 that means:

• Admin: $210,000 × 250 ÷ 10,000 = $5,250, up $700 (15%)
• Capital works: $90,000 × 250 ÷ 10,000 = $2,250, no change
• Total $7,500 a year, or $1,875 a quarter

What to ask at the meeting:

Why is insurance budgeted at $62,000 when it cost $71,300 this year? Premiums rarely fall by 13%. Unless someone has a cheaper quote in hand, this line is too low, and the gap will turn up as next year's deficit.

Why are additional management fees $2,000 and legal fees zero? Both were far higher this year. Lot 21's recovery is still going, so legal costs probably won't fall to zero.

What's the $20,000 contingency for? A contingency can make sense, but ask how the figure was worked out.

Why is the capital works contribution short? The 10-year capital works fund plan says our example building should contribute $140,000 a year to pay for the lift upgrade and roof replacement it forecasts for the next decade. The proposed budget sets aside $90,000. Owners voting for this budget are agreeing to save $50,000 a year less than the plan says the building needs. That shortfall usually comes back later as a special levy.

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Step 9: The audit report

Our example building's combined annual budget is $272,000. In NSW an audit is compulsory for schemes with more than 100 lots or a total annual budget of $250,000 or more, so this scheme has to be audited.

Read the opinion paragraph. An unqualified opinion means the auditor considers the statements fairly presented. A qualified opinion ("except for") means there's a specific problem, and the paragraph headed "Basis for qualified opinion" says what. Strata audits commonly include a standard qualification saying the auditor couldn't independently confirm every levy receipt. That one is routine. Ask about anything else, especially anything new this year.

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The questions this pack produced

After about an hour with the documents, Lot 12's owner has eight specific questions for the AGM:

1. Why were three $1,950 invoices for the same plumbing job paid on the same day?
2. Can the $6,200 gutter replacement be moved from the admin fund to the capital works fund?
3. What was the $5,000 "Works as per quote" on 3 February?
4. What made up the $6,950 in additional management fees?
5. What's being done about Lot 30's arrears?
6. Why is insurance budgeted $9,300 below this year's actual premium?
7. How was the $20,000 contingency worked out?
8. Why is the capital works contribution $50,000 a year below the 10-year plan?

None of them need accounting training. Each one came from putting two documents side by side: the minutes against the ledger, the statement against the budget, the budget against the capital works plan.

Send the questions to the strata manager in writing before the meeting. You'll get better answers than you would by asking on the night.

The same documents in other states

Everything above works in any state. The fund names and the laws differ.

Quorum rules, proxy limits, resolution thresholds, interest on late levies and audit requirements are set state by state. Check your own state's Act before relying on the NSW figures above.

Terms used in this guide

Where UnitBuddy fits

UnitBuddy keeps the numbers from these documents in one place across years, so levy history, fund balances and spending against budget are already lined up when the next AGM pack arrives.

Further reading

Keep the scheme file in one place the committee and the manager can both open. Features, pricing, or book a tour.