Garth Freeman, managing director of Auckland-based Body Corporate Services, said Chartered Accountants Australia New Zealand had made the business an approved practice entity.
"It's quite depressing that the actions of others are bringing the entire industry into such disrepute. There are some existing and voluntary options available for body corporate managers," Freeman said.
Calls for regulation were made after fears were raised about the amount of money being held by the managers.
The Unit Titles Act had weaknesses, he said, outlining practices he had issues with.
"I am well aware from reviewing various AGM minutes that numerous competitors in the industry have failures of understanding of even basic accounting procedures - we have taken over clients where the old body corporate manager didn't even reconcile bank account balances at the end of the financial year (a task a straight out of uni graduate accountant would understand to do), and I have seen basic accounting errors where competitors have included GST under expense columns and accounts which often don't state whether or not the accounts are GST inclusive or exclusive," Freeman said.
He was responding to concerns about practices raised by Body Corporate Chairs Group national president Neil Cooper, Auckland District Law Society property law committee member Liza Fry-Irvine, Home Owners & Buyers Association president John Gray, accountant and a body corporate chairman Brent Murdoch and North Shore lawyer Nick Kearney. They all featured in an article published on Friday, raising issues about the accountability, responsibility and power of managers who are not subject to regulations.
Freeman said there was no compulsion to become an approved practice entity.
"There are supervisory regimes that can apply to body corporate managers, albeit on a voluntary basis. Body corporate managers generally prepare and provide the accounting records," he said, so having chartered accountants involved was important.
Becoming an approved entity drew responsibilities.
"This means that the principals of our firm are responsible and accountable to CAANZ for the conduct of our business and that we must comply with the CAANZ rules as all times. This includes compliance with ethics. There are also CAANZ rules about handling of client funds. Finally this means our firm itself is subject to regular audits by CAANZ, which can occur any time."
Becoming an approved practice entity was a strong indicator of professionalism and gave clients confidence, he said.
"We also believe that we are unique in New Zealand as the only full body corporate management firm that has obtained this designation. We are able to obtain it as both company directors are members of CAANZ," Freeman said.
The firm maintained separate bank accounts for all clients and passed interest earnings to them, he said. "We encourage our clients to engage independent audits of their specific financials, with appropriate resolutions. Some of our industry - and our firm in particular - are trying to do the right thing."
