Repsol YPF

It is estimated that in Spain around 85% of the population lives in buildings or on housing estates with communal areas which must be managed by the corresponding residents’ associations. Their residents’ committees are obliged to approve the accounts every year, in other words, to draw up a balance of income and outgoings, as well as obtaining the required authorisations to ask for funds and carry out ad-hoc building work or improvements. 

The role of the property administrator is to ensure the correct functioning of the property in exchange for payment. Nevertheless, it is not the administrator but the president who represents the association before third parties. The president chairs residents’ meetings and must make decisions in the case of an emergency.

The administrator, be it one of the residents or a professional hired by the committee, is authorised to have access to the funds held by the association. In order to use this capital, they must have the prior consent of the rest of  the residents and inform the president, who will sign to vouch for the use of the funds when they have been withdrawn from the current account.

When the president and the rest of the committee members are appointed their signatures are also authorised. The opportunity may also be taken to approve a request for funds. Everything that is said and agreed at the committee meeting is recorded in the Minutes Book, a book with numbered pages which can be bought in any bookshop. 

When the book has been duly stamped at the Land Registry where the building is registered, a Fiscal Identification Number (NIF) must be applied for at the tax office when the residents’ association is formed for the first time, as it must be a legal entity in order to open current accounts at banks and savings banks. The entity can also register with the Social Security in order to be able to employ people.

Common transactions
The most common transactions are the receipt of monthly payments from residents to cover the association’s general expenses. The amount usually depends on the characteristics and dimensions of the building in question as specified in the property deed. This amount allocated to pay for the communal costs is established, as such, depending on the usable area of each dwelling.

Account management normally becomes more complicated when building work is to be carried out and additional payments are required in order to pay for it. In such cases, it must be remembered that shops which do not generally pay communal maintenance costs for the stairs or reception area, may or may not be exempt from the said one-off payment. The deeds for new occupation will specify this but common sense dictates that these shops should pay for costs such as those associated to the façade, for example. 

Within each financial year
The Horizontal Property Law does not stipulate a specific month for submitting the accounts for the committee’s approval, but it must be done once during the financial year. When the committee meets the agenda usually includes the change of the president. Normally a rota is established. The outgoing president, whether or not he also acts as the administrator, will present the accounts relating to his term of office. 

There must be a document detailing the expenses and income, any debts and what they are for, as well as the residents with outstanding debts. The list must even include the petty cash used to replace light bulbs and other minor expenses related to the staircase.

As such, in accordance with the law, once a year a general meeting is held, at which the accounts are approved and each resident’s fees are reviewed. 

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