Audit and Condominium Management Consulting Services

In the context of the Housing Law 2023 (No. 27/2023/QH15) officially taking effect from January 1, 2025, regulations on condominium operation and management are becoming increasingly stringent.

Currently, the majority of disputes and lawsuits in condominiums stem from:

• Legal regulations on Condominium Management, including the Housing Law and related decrees and circulars, undergoing numerous changes and lacking clarity.
• A lack of transparency in condominium financial management due to unclear regulations on financial management/accounting/taxation for condominiums.·       
• Unclear delineation of roles among the Board of Management (BOM) and the Management Board (MB) as well as the Developer in the operation, management, and maintenance of the condominium.

With experience in auditing financial statements – operational management funds, and maintenance funds for over 20 projects in Ho Chi Minh City, over 20 years of operation in Vietnam, and as a member of the global network Russell Bedford International, Russell Bedford KTC offers an “All-In-One” solution to help the Condominium Board of Management (BOM) and the Management Board (MB) thoroughly resolve difficulties in condominium management.

We provide high-quality consulting services to meet the needs for legal compliance, budget optimization, and financial transparency, as well as to protect the reputation of the BOM and MB before the Condominium Meeting and the residents.

Our services include:

1. Audit and Assurance Services

Audit of Financial Statements – operational management funds: Auditing and expressing an audit opinion on the Financial Statements of the operational management fund, including examining records and vouchers to generate the income and expense report of the MB during financial periods, verifying the reasonableness and validity of operational management expenses, and presenting income, expenses, taxes, receivables/payables, and the surplus of the Operational Management Fund – while simultaneously reviewing the level of expenses against the budgets prepared by the MB and approved by the BOM.

Audit of Financial Statements – maintenance funds: Accurately confirming the balance, the disbursement status from the Developer, and the validity of expenditures from the 2% Maintenance Fund based on the total apartment sales price handed over by the Developer to the BOM. Verifying that maintenance expenditures comply with the Law, decrees, and circulars related to condominium management, including adherence to the annual budget approved by the Condominium Meeting.

Audit of Income and Expense Reports related to the Exploitation of Common Areas: determining how common areas of the condominium and contracts for their exploitation are recorded, how costs are allocated, and how income from the exploitation of common areas is transferred to the Maintenance Fund, as well as the budgets for utilizing this income at the Condominium Meeting.·        

Consulting on establishing an internal control system & monthly/annual financial report templates for the condominium: Advising on the development of an accounting system that clearly separates operational management accounts and maintenance fund accounts. Guiding the accounting entry for the Operational Management Fund, report templates from the Management Company, accounting and tax entries for the BOM, and the maintenance fund report from the BOM to the residents.

2. Financial and Legal Consulting Services

Regular Consulting: Regular consulting services for the BOM include answering questions via email or an online meeting regarding condominium operations and accounting/finance/tax/legal matters related to condominium management, but excluding detailed reports on a subject requiring in-depth research. The regular consulting fee will depend on the number of topics requiring consultation.

Legal Compliance Review: Consulting on the procedures for organizing the Condominium Meeting (annual/extraordinary), procedures for electing the BOM, procedures for selecting and changing the MB in accordance with the majority principle and legal regulations.

Consulting on establishing and reviewing the 3 Core Regulations of Condominium Management including:

– Condominium Rules: Reviewing and updating codes of conduct, safety, and order to closely align with operational realities and current laws.

– BOM Financial Revenue and Expenditure Regulations: Establishing revenue and expenditure processes, budget control, and approval limits.  

– BOM Operation Regulations: Defining the duties of each member, meeting mechanisms, voting methods, and remuneration levels.

3. Tax Consulting Services

Value Added Tax (VAT) Compliance and Consulting: Consulting on the operational structure of the condominium and risks related to issuing electronic invoices and declaring VAT; advising on appropriate tax calculation methods for the MB and BOM.

Corporate Income Tax (CIT) Compliance and Consulting: Clearly separating profits from the exploitation of common amenities (subject to CIT) from interest on savings deposits of the 2% Maintenance Fund (usually not subject to CIT) and advising on how to prepare CIT reports.