When It’s Other People’s Money, a Shrug Isn’t Good Enough 💰

We recently took over the management of a strata scheme that has had a somewhat turbulent history.

One of the biggest areas of concern for owners, was the financials.

What was discovered is a good example of why financial transparency, proper internal controls and engaged owners are so important in strata management.

It started with an owner asking questions 🔍

A Council of Owners member requested a detailed Income & Expenditure Statement and took the time to carefully scrutinise the transactions.

In doing so, they spotted something alarming.

Money had been paid from their strata company’s bank account to an unrelated owner in a completely different strata scheme. 😳

Naturally, the strata manager was questioned about how this could have happened.

The response was reportedly:

“I was probably on the phone while unticking invoices.”

The next question was perhaps even more important:

What checks have now been put in place to ensure this can never happen again?

The response?

A shrug. 🤷

And that, for us, is perhaps more concerning than the original mistake.

Mistakes can happen. What matters is having robust processes designed to prevent them, identify them quickly when they do occur, and make sure they don't happen again.

Then there were the duplicate payments 💸

Further scrutiny of the financial records identified multiple invoices that appeared to have been paid twice, with contractors subsequently issuing refunds for the duplicate payments.

This prompted another obvious question:

Who is auditing or checking the accounts?

The response was that the accounts didn't have to be independently audited and that the strata management company carried out its own internal checks.

But internal checks only provide protection if they are robust, consistent and actually working.

What does “unticking” an invoice actually mean? ✅

Different strata management software uses different terminology, but there is generally a point in the accounts payable process where an invoice receives its final approval before payment.

Sometimes this is referred to as “unticking” the invoice.

It might sound like a simple click.

It shouldn't be.

That final approval is an important check and balance before owners' money leaves the strata company's bank account.

Before we approve an invoice for payment, we should be looking at the actual invoice and confirming:

🔹 Is it for the correct strata scheme?

🔹 Is the supplier or contractor correct?

🔹 Does the amount entered match the invoice?

🔹 Do the bank details match the contractor records?

🔹 Has the invoice already been paid?

🔹 Is the transaction description accurate and meaningful?

🔹 Has it been allocated to the correct budget category?

Only once those checks have been completed should the invoice receive its final approval for payment.

The final click shouldn't simply mean: “Pay this invoice.”

It should mean: “I have checked this invoice and I am satisfied that this payment is correct.” ✔️

This is also why financial transparency matters 👀

We strongly believe that owners should be provided with meaningful financial information about their strata company.

Including comprehensive financial reports with meeting papers gives owners an opportunity to understand where their money is going, ask questions and identify anything that doesn't look right. 🚩A one-page financial summary might show that the scheme spent $62,000 on “maintenance expenses” — but it won’t tell owners how, where or why that money was spent... And that’s the detail that matters.

It creates another layer of oversight.

And in this particular case, that oversight mattered.

It wasn't an internal audit or accounting check that identified money being paid to the wrong person.

An owner found it.

Which raises an uncomfortable question:

What if they hadn't? 🤔

Would the payment have eventually been discovered?

How long would it have taken?

And how many owners actually take the time to work through every transaction in an Income & Expenditure Statement?

These are owners' funds

When strata managers deal with a strata company's finances, we need to remember what those numbers actually represent.

They are owners' hard-earned money.

Owners pay levies with the expectation that those funds will be carefully managed and used for the proper purposes of their strata company. That comes with a significant level of responsibility.

Of course, human error can occur in any business. But good financial governance isn't about pretending mistakes will never happen.

It's about having layers of checks and balances that make mistakes difficult to make and easy to detect. 🔐

And when something does go wrong, the response should be to investigate it, correct it and strengthen the process. Not shrug.

Good strata management isn't simply about processing invoices quickly.

It's about making sure the right invoice, for the right strata scheme, for the right amount, is paid to the right person — every single time.

Because when you're entrusted with other people's money, the details matter. 💙