What an HOA CPA does
An HOA CPA performs the annual audit, review or compilation of the association’s financial statements. That includes the operating fund, the reserve fund, assessments receivable and the disclosures about future major repairs and replacements.
Most HOA CPAs also prepare the association’s federal tax return, either Form 1120-H or Form 1120, and advise on state requirements.
The auditor must be independent of the association and of whoever keeps its books. That is why the management company should not hire or supervise the auditor. See our HOA audit services.
How to verify an HOA auditor’s license
- License. Search the CPA and the firm on NASBA CPAverify, or find your state board through NASBA’s state board directory. Firms usually hold a separate firm permit.
- Peer review. Firms that perform audits and reviews must be peer reviewed. Look up the latest report in the AICPA Peer Review public file and ask for a copy.
- Independence. Ask in writing whether the firm or its people have any business or family relationship with your management company or board members.
Questions to ask an HOA auditor before hiring
- How many community associations do you audit each year, and of what size?
- Is your firm peer reviewed? May we see the latest report?
- Do you have any relationship with our management company?
- Audit, review or compilation: what do our bylaws and state law require?
- How do you handle the reserve study and the disclosures about future repairs?
- Who prepares our tax return, and how do you choose between Form 1120-H and Form 1120?
- Who will present the results to the board, and when?
Free checklist
HOA Auditor RFP and Board Interview Questions
Red flags
- The management company picks the auditor and the board never interviews anyone.
- The same firm keeps your books or runs other management functions for the year it audits.
- No peer review report, or the firm will not share it.
- The CPA cannot explain reserve fund disclosures or what your state requires.
- The firm or a CPA does not appear on CPAverify or the state board lookup.
Why clients choose Your Virtual CPA
- A licensed CPA firm, independent of any management company, serving associations nationwide.
- HOA audits, reviews and compilations, plus association tax returns.
- Guides boards can use: Virginia HOA audit requirements, Maryland HOA audit requirements and HOA audit cost.
- Transparent fees quoted upfront, in writing, and a free initial consultation.
How it works with us
Best for: condo and homeowners associations, self-managed or professionally managed, that need an annual audit, review or compilation.
- Free initial consultation. Tell us your association’s size, governing documents and deadline.
- Fees quoted upfront, in writing. An engagement letter the board signs before work starts.
- Document request. A clear list for the board and manager.
- Fieldwork. Done virtually, with questions sent in batches.
- Report to the board. Financial statements, any findings and the tax return.
Management company accountant vs independent CPA firm
| Management company accountant | Independent CPA firm | |
|---|---|---|
| Keeps the books | Usually | No (for the year it audits) |
| Licensed and peer reviewed | Not required | Required for audits and reviews |
| Independent of the numbers | No | Yes |
| Issues an audit or review report | No | Yes |
| Prepares Form 1120-H or 1120 | Sometimes | Yes |
| Answers to | The manager | The board |
Expert CPAs. Personal attention.
Choosing an auditor for your association? Bring your governing documents and last year’s statements to a free initial consultation and talk to a CPA.
Frequently asked questions
The board. The audit reports on financial statements that the management company often prepares, so the auditor should answer to the board. Management can collect proposals, but the board should interview the finalists, ask about any relationship with the manager, and sign the engagement letter.
It depends on your governing documents and state law, and some states set requirements by budget size. An audit gives the most assurance, a review gives limited assurance and a compilation gives none. Check your bylaws and our state guides, or use our audit requirement checker.
No. An audit must be performed by an independent licensed CPA firm. Someone who keeps your books, or works for the manager that does, is not independent of the numbers being audited.
Search the CPA and the firm on NASBA CPAverify or your state board of accountancy. Then look up the firm’s most recent peer review report in the AICPA Peer Review public file, since firms that perform audits must be peer reviewed.
Often, yes. Associations usually file Form 1120-H or Form 1120 each year. Ask the CPA which form fits your association and why, since the choice can change from year to year.
Yes. Your Virtual CPA is a licensed CPA firm that audits community associations nationwide, working virtually with your board and manager.
It depends on the association’s size, the number of funds and the condition of the records. See our HOA audit cost guide for the factors. We quote fees upfront, in writing, after a free initial consultation.
Sources
- NASBA CPAverify
- NASBA: State boards of accountancy
- AICPA Peer Review public file search
- IRS: About Form 1120-H, U.S. Income Tax Return for Homeowners Associations
General information as of October 20, 2026. Tax rules change; talk to a CPA about your situation.