17 May Which documents do owners need before the AGM?

Management Rule 56 of the Sectional Title Act states what business should be conducted at the annual general meeting of a body corporate. The documents or information that an owner must receive is:

The annual financial statements

The financial statements will be the statements for the immediate preceding financial year. The trustees would have reviewed the statements prior to it being included in the notice of the general meeting to all members of the body corporate. These statements must be signed by the trustees before the auditors will sign it. A copy of the financials, signed by the trustees and the auditors, must be included for distribution to all members.

A proposed budget of income and expenditure

The trustees, with the assistance of the managing agent, must prepare a budget of income and expenditure for the financial year. Once they have done so, the proposed budget must be included in the notice of the general meeting for distribution to all members of the body corporate.

The schedule of replacement values (for insurance purposes)

The trustees are responsible to ensure that the complex is adequately insured for replacement purposes. The insurance policy for the body corporate must be reviewed annually and any adjustments to the insured value must then be instituted on the instructions of the trustees. It is advisable that the trustees employ the professional services of an independent valuer to assess the insured replacement value of the complex.

Owners must receive this document so that they can assess if their section is adequately insured. If an owner feels that his section is not adequately insured by the body corporate, that owner may ask for his section to be insured for an additional amount over and above the amount insured by the body corporate.

A form of proxy

If an owner is not able to attend an annual general meeting, he or she may appoint a proxy to attend the meeting on their behalf. This proxy may receive certain instructions from the owner in the event that a vote is required during the general meeting. The owner must however, ensure that he or she completes the form and indicates clearly who the nominated proxy will be at the meeting. A proxy will form part of the required quorum for the meeting.

A trustee nomination form

If an owner wishes to nominate another person to stand as a trustee, they will need to complete this form correctly. Only an owner may nominate someone to stand as trustee. A trustee does not have to be an owner in the said scheme to stand as one. For the nomination to be valid, the person nominating another person must sign the document as well as the person who is being nominated. If either of these two signatures are missing, the nomination is not valid. The complete form must be returned to the managing agent at least 48 hours before the commencement of the general meeting.

You can read our first blog here: What you need to know about AGMs – 6 Key questions