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Reserve Fund Annual Allocation

The benchmark analysis produces this reserve fund regular contributions specific number for the current fiscal-year at the point-in-time of the depreciation report assignment.

Based on market forces, cumulative expenditure events since construction and on the efforts of successive strata councils, it represents a current optimized regular allocation amount that could be drawn on the owners of the strata corporation, based on current fiscal-year financials and the all planned current and future probable major repair and replacement expenditures as laid out in the benchmark an its resulting benchmarked projection and scenario.

Beware of reports that take either the benchmark current replacement requirements or the benchmark current fiscal-year annual allocation number and stipulate that maximum or ‘full-funding | fully-funded status’ is attained by inputting either amount, without adjusting it for inflation or in any way, in any other year or even in thirty years’ time at the end of a projection – estimating that your retirement requirements in thirty years’ time are equal to today’s estimated needs makes little sense when the results of the sinking fund methodology produce present-value-of-money amounts.

About Author: Jean-François

With experience gained in construction, project management, field reviews, inspections, report writing and as strata president, J.-F. has cross-industry expertise guaranteeing that you will participate in a process geared to improving the corporation's finances and to setting the condo | strata board | council's planning to stand the test-of-time.