FREE CMCA Knowledge Questions and Answers Flashcards

The federal Fair Debt Collection Practices Act (FDCPA) most directly applies to:

Answer: Third-party collectors, such as collection agencies or attorneys, collecting delinquent assessments

Courts have treated assessments as consumer debts, so third-party collectors pursuing them are subject to the FDCPA.

Best practice for handling operating and reserve funds is to:

Answer: Hold them in separate accounts and not commingle them

Separate accounts protect reserves for their designated purpose and keep accounting transparent.

Board meeting minutes should primarily record:

Answer: Actions taken, including motions and their outcomes

Minutes are a legal record of actions taken, not a transcript of the debate.

Postponing needed repairs until a later date, often resulting in higher future costs, is called:

Answer: Deferred maintenance

Deferred maintenance is work put off, which usually increases deterioration and eventual repair costs.

When soliciting bids for a landscaping contract, the manager should:

Answer: Provide identical written specifications to all bidders

Uniform specifications make bids comparable and keep the process fair.

When determining whether a worker is an employee or an independent contractor, the IRS focuses mainly on:

Answer: The degree of control the association has over how the work is performed

IRS tests weigh behavioral, financial, and relationship control to classify a worker.

Which type of CPA engagement provides the highest level of assurance on an association's financial statements?

Answer: Audit

An audit includes testing and verification and results in an opinion, giving more assurance than a review or compilation.