An Alberta condominium corporation’s financial statements show its operating fund and its reserve fund: what it holds, what it owes, and how the year compared with budget. A buyer should read them with the budget and the reserve fund plan, looking for arrears, deficits, loans, special levies and a reserve that is falling behind its own plan.
What owners receive, and when
Every year the corporation must prepare three things and send them to each owner, and to any mortgagee who has asked, at least 14 days before the annual general meeting: financial statements for the year just ended, prepared under Canadian generally accepted accounting principles; an annual report on the reserve fund; and the budget for the year now starting (Act, s. 30(4)).
The budget has its own earlier deadline. It must go out at least 30 days before the fiscal year it covers begins, and any revision must be sent as soon as possible (Regulation, s. 20.51). The meeting itself must be held within 15 months of the previous one (Act, s. 30(2)), so a full set of documents more than about 15 months old usually means something has slipped.
- Financial statements
- Annually, under Canadian GAAP · Act s. 30(4)(a)
- Delivered to owners
- At least 14 days before the AGM · s. 30(4)(b)
- Annual budget
- At least 30 days before the fiscal year · Reg. s. 20.51
- Reserve fund annual report
- With the AGM package · s. 30(4); Reg. s. 29
- AGM interval
- Within 15 months of the last one · s. 30(2)
- Corporation keeps statements
- 7 years · Reg. Schedule 3
Audited, reviewed or compiled
Open to the page in front of the statements, signed by the accountant. Its title tells you how much the figures were checked.
- Independent auditor’s report. The auditor tested the records and gives an opinion that the statements are presented fairly. The highest level of assurance.
- Independent practitioner’s review engagement report. Mainly inquiry and analysis. Limited assurance: the practitioner says nothing came to their attention suggesting the statements are materially wrong.
- Compilation engagement report. The accountant assembled the statements from the corporation’s information. No assurance is given that they are correct.
The Act asks for GAAP statements but does not itself require an audit. The level usually comes from the corporation’s bylaws. The default bylaws in Schedule 4 of the Regulation direct the treasurer to prepare or arrange audited statements. Corporations that registered their own bylaws may say something else, so check the bylaws rather than assuming.
An audit report that is “qualified” or that contains an “emphasis of matter” or “material uncertainty” paragraph is the accountant telling you something specific. Read that paragraph slowly, and ask the board about it in writing.
Two funds, kept apart
Condo statements are usually laid out by fund. The operating fund pays for things that recur every year. The reserve fund exists because section 38 of the Act requires a fund “reasonably sufficient” for major repairs and replacements that do not normally occur annually. It covers the corporation’s property, the common property and any managed property.
The Regulation forbids mixing reserve money with operating money, except to pay for repairs or replacements of depreciating property, or with another corporation’s reserve (s. 27(2)–(3)). The corporation must also keep the reserve “at an appropriate amount” so that s. 38 continues to be met (s. 27(1)). Reserve money is an asset of the corporation and is not refunded to owners when they sell (Act, s. 38(3)).
The statement of financial position
This is the balance sheet: what the corporation holds and owes on the last day of its year, with the prior year beside it. The example on the home page is annotated line by line. The lines that carry the decision are:
- Contributions receivable. Fees owners have not paid. A sharp increase means arrears, and arrears get carried by everyone else.
- Accounts payable and accrued liabilities. Bills incurred but not paid. If they are large compared with operating cash, the operating fund may be short.
- Deferred contributions or special levy. Money billed for a specific project and not yet spent. Its presence means a levy was passed. Find out how many instalments remain and who pays them under your contract.
- Loans payable. Corporations do borrow, often for envelope or parkade work. The loan disclosure statement you can request shows the rate, payment and term.
- Fund balances. A negative operating fund means past years’ costs outran contributions. The reserve fund balance is the number to compare with the reserve fund plan.
The statement of operations
This shows the year’s revenue and expenses, ideally against budget. Read the variances, not the totals.
| Note | Actual | Budget | |
|---|---|---|---|
| Revenue | |||
| Owner contributions | 612,000 | 612,000 | |
| Interest and other | 8,400 | 4,000 | |
| Total revenue | 620,400 | 616,000 | |
| Expenses | |||
| Insurance1 | 168,000 | 121,000 | |
| Utilities | 148,000 | 128,000 | |
| Repairs and maintenance2 | 118,000 | 60,000 | |
| Management fees | 54,000 | 54,000 | |
| Administration and other | 57,864 | 50,000 | |
| Total expenses | 545,864 | 413,000 | |
| Excess of revenue over expenses before transfer | 74,536 | 203,000 | |
| Transfer to reserve fund3 | 4 | (145,000) | (186,000) |
| Excess (deficiency) of revenue over expenses | (70,464) | 17,000 | |
- 1Insurance ran 39% over budget. Here insurance is the largest single expense, so a jump like this flows straight into next year’s budget. Check the current policy and its deductible in the insurance certificate you can request.
- 2Repairs nearly doubled. Is the operating fund paying for work that is really deferred major repair? The minutes usually explain it.
- 3Less went to the reserve than planned. $145,000 against a budgeted $186,000. A board that under-funds the reserve to keep fees down is passing the cost to future owners.
The reserve fund note
Somewhere in the notes is a continuity schedule: the reserve fund’s opening balance, what went in, what came out, and the closing balance. Put it beside the reserve fund plan, which sets out the contributions the board approved after the last reserve fund study.
| Note | 2025 | 2024 | |
|---|---|---|---|
| Balance, beginning of year | 538,000 | 482,000 | |
| Transfer from operating fund | 145,000 | 176,000 | |
| Interest earned | 0 | 9,000 | |
| Expenditures — building envelope1 | (636,000) | (129,000) | |
| Balance, end of year | 47,000 | 538,000 |
Two comparisons matter. First, did the contribution in the statements match the plan? Second, does the closing balance match the balance the plan projected for this year? The corporation’s own annual reserve report must set out the year’s opening amount, every payment in and out, the property repaired or replaced and its cost, and the amount projected for the current year (Regulation, s. 29). If that report and the statements disagree, ask why. The reserve fund check does this arithmetic for you.
Read the notes
The notes are where accountants put what does not fit in a number. In condo statements, look for:
- Commitments. Signed contracts for future work, such as a parkade membrane or window replacement next spring.
- Contingencies. Lawsuits by or against the corporation, insurance claims, disputes with the developer.
- Subsequent events. Things that happened after year-end but before the statements were signed, often a special levy vote.
- Related parties. Payments to the developer, a board member or a company connected to either.
The information statement a corporation must provide on request covers several of these directly: actions served on the corporation, unsatisfied judgments, written demands over $5,000, and any structural deficiencies the corporation knows of (Regulation, s. 20.52(1)(a)).
What to do next
If you have an accepted offer, make it conditional on reviewing the condominium documents and give yourself enough days to do it. The corporation has 10 days to respond to a written request. Here is exactly what you can ask for, and what it may cost. Then work through the warning signs.
Questions people ask
When do owners receive the financial statements?
At least 14 days before the annual general meeting, together with the annual report on the reserve fund and the annual budget (Condominium Property Act, s. 30(4)). The budget itself must reach owners at least 30 days before the fiscal year it covers starts (Regulation, s. 20.51).
Do condo financial statements in Alberta have to be audited?
The Act requires statements prepared in accordance with Canadian generally accepted accounting principles. Whether they are audited, reviewed or compiled usually comes from the corporation’s bylaws. The default bylaws in Schedule 4 of the Regulation refer to audited statements, but many corporations have replaced those bylaws. The accountant’s report at the front of the statements tells you which you have.
What is the difference between the operating fund and the reserve fund?
The operating fund pays for recurring costs: insurance, utilities, management, routine repairs. The reserve fund is a separate pool, required by s. 38 of the Act, for major repairs and replacements that do not happen every year, such as roofs, parkade membranes and elevators. Reserve money must not be mixed with operating money.
How far back should a buyer read?
At least two or three years. One year shows a position; several show a direction. Corporations must keep annual financial statements and budgets for seven years and reserve fund reports and plans for twelve, so earlier years can be requested.
Sources
- Alberta King’s Printer, Condominium Property Act, RSA 2000, c C-22 — office consolidation current as of 14 May 2026; ss. 30(4), 38, 43.2, 44. Read 25 October 2026.
- Alberta King’s Printer, Condominium Property Regulation, Alta Reg 168/2000 — consolidated to Alta Reg 23/2026, current as of 15 February 2026; ss. 20.51–20.54, 21.1–30, Schedule 3. Read 25 October 2026.
- Government of Alberta, Reserve funds. Read 25 October 2026.