Strata Management Licensing Practice Exam · Question
What is the primary consequence of a strata corporation failing to obtain a depreciation report?
While there isn't an immediate penalty from BCFSA, failing to have a depreciation report can severely impact a strata's financial health, borrowing capacity, tr
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Question: What is the primary consequence of a strata corporation failing to obtain a depreciation report?
Answer options:
- The strata council members are personally liable for all future repair costs.
- The strata corporation will automatically be fined by BCFSA. ✅ It may make it difficult to secure loans for major projects, reduce property values, or lead to owner disputes due to unfunded repairs.
- All owners are exempt from paying contingency reserve fund contributions.
Correct answer: It may make it difficult to secure loans for major projects, reduce property values, or lead to owner disputes due to unfunded repairs.
Explanation: While there isn't an immediate penalty from BCFSA, failing to have a depreciation report can severely impact a strata's financial health, borrowing capacity, transparency for owners, and lead to poor long-term planning and potential cash calls (special levies).
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