M-100 Exam Questions with 100% Correct Answers | Verified | Updated 2024, Exams of Advanced Education

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M-100 Exam Questions with 100% Correct Answers | Verified | Updated 2024 Community Association - Correct Answer-Mandatory memberships, mutually binding contracts, lien-based assements Purpose of community association - Correct Answer-Provide for the community, business, and governance aspects of the association Basic types of community association - Correct Answer- Planned communities, condominium, and cooperatives Planned community - Correct Answer-HOA, owner association Condominium - Correct Answer-Owner of his/her unit Cooperative - Correct Answer-Owns stock/holds lease pg. 1 professoraxe l Types of community associations - Correct Answer-Master/umbrella, Mixed use development, 55 and older Association derives legal obligation from - Correct Answer- Federal, state and local laws- legal documents, lender requirements, standards set by professional bodies EEOC - Correct Answer-Equal employment opportunity commission Equal employment opportunity commission - Correct Answer- Prohibits discrimination in hiring, promoting, etc. FLSA - Correct Answer-Fair Labor Standards Act Fair Labor Standards Act - Correct Answer-Dictates standards for minimum wage FMLA - Correct Answer-Family Medical Leave Act pg. 2 professoraxe l Declaration, CCRS, master deed - Correct Answer-Establish the chain of title and rights of ownership for each piece of real estate Proprietary lease - Correct Answer-Defines member or stockholders right and obligations in a relative to the living unit Articles of incorporation - Correct Answer-Documents that establish the corporation Bylaws - Correct Answer-Formally adopted regulations for the administrative and management of a community association Resolution - Correct Answer-Motion that follow a swell format and is formally adopted by the BOD public offering statement - Correct Answer-Disclosure statement- not apart of the governing documents Benefits of incorporating - Correct Answer-Limits liability Makes it easier to deal with contractors pg. 5 professoraxe l Scope of Rules and ARCH guidelines - Correct Answer- Behavior of residents, guests and visitors Appearance of individual lots/units Use of common property Use of individual lots/units Types or rules or resolutions for a community association - Correct Answer-General Administrative Special Policy General resolution - Correct Answer-Involve routine events (adoption of annual budget) Administrative resolution - Correct Answer-Affects internal operations of the community association (i.e.: where board meetings are held) pg. 6 professoraxe l Special resolution - Correct Answer-States board decisions apply a policy or rule to individual situation (i.e.: decision about alleged rule violation) Policy resolution - Correct Answer-Affects owners rights and obligation - addresses ambiguities and omissions in the declaration Sections of a resolution - Correct Answer-Purpose Authority Scope and intent Specifications Due process procedure - Correct Answer-Formal process designed to protect the rights of all parties involved Alternative dispute resolution (ADR) - Correct Answer- Encouraging people to comply with rules and regulations by using trained uninvolved 3rd party Arbitration - Correct Answer-Win lose- lose lose pg. 7 professoraxe l Common mistake to avoid when presenting a budget - Correct Answer-Presenting so much information that people are overwhelmed and confused Authority to collect assessments - Correct Answer-Federal laws and regulations State statutes Governing documents Effective collection policy - Correct Answer-Be established by a proper and formal resolution Specify only actions that are within the power of the community association and its board Set a firm due date Outlines steps to be taken when payment is late Specifies delinquent assessment should be referred to legal counsel pg. 10 professoraxe l Provided for the collection of any costs associated with collecting delinquent assessments Extra -judicial remedies - Correct Answer-Outside the law remedies to collect assessments Lien - Correct Answer-A legal claim by one party on the property of another to obtain the payment of a debt or the satisfaction of an obligation Acceleration - Correct Answer-Pay assessments ahead (entire year) Foreclosure - Correct Answer-Legal proceeding filed in court whereby a party with a claim against an owner can claim ownership of the the unit involved in order to recover the money it's owed. Personal money judgment - Correct Answer-A decision by a judge to allow the community association to claim the owners personal property to settle a delinquent account pg. 11 professoraxe l Chapter 7 bankruptcy - Correct Answer-Straight bankruptcy or liquidation for an individual or corporation Chapter 11 bankruptcy - Correct Answer-Corporate reorganization Chapter 13 bankruptcy - Correct Answer-Personal re- organization (make a deal to pay back a cetain amount) Fair debt collection practices act - Correct Answer-Protects debit or is from unscrupulous debt collectors Bad debt right off - Correct Answer-Uncollectible debts Types of accounting methods - Correct Answer-Cash based Accrual based Modified cash based Cash based - Correct Answer-Income - when received Expense- when paid pg. 12 professoraxe l Review - Correct Answer-A less thorough and therefore less costly review of a community associations financial activities Compilation - Correct Answer-A presentation of financial statements by a CPA without the assurance that the information to conforms to GAAP Investments - Correct Answer-Involve the purchase of anything with money value for the purpose of generating additional money overtime Investment objectives - Correct Answer-Safety Liabilty Yield Engagement letter - Correct Answer-A legally binding contract between and CPA and an association GAAS - Correct Answer-Generally Accepted Auditing Standards pg. 15 professoraxe l Investment policies and procedures - Correct Answer-A well run community association should have a written investment policy Safeguarding Association funds - Correct Answer-Protecting Association funds from theft and/or embezzlement and to prevent fraud Representation letter - Correct Answer-States that the information the community association provides is true to the best of its knowledge. Type of federal income tax filing forms - Correct Answer-1120 and 1120 H Treasury bills - Correct Answer-Short term instruments that mature in 1326 or 52 week periods. When the bill matures the buyer receives the face value Treasury notes - Correct Answer-Matures in 1 to 10 years Treasury bonds - Correct Answer-Matures in more than 10 years pg. 16 professoraxe l Safety - Correct Answer-For community association investments consist of protecting the principal from loss Liquidity - Correct Answer-Refers to the ease with which an investment can be converted into cash or a cash equivalent Yeild - Correct Answer-Amount of return on investment Facilities maintenance - Correct Answer-The process of operating maintaining and repairing and replacing common property Management tool - Correct Answer-Any means used to track record remind or command attention Sustainable lifestyle's - Correct Answer-Communities that are developed to meet the needs of the present without him promising the ability of future generations to meet their own needs pg. 17 professoraxe l Loss reduction - Correct Answer-Reduce the severity of the loss if something does happen Segregation of exposures - Correct Answer-Segregate assets or operations so that if there is an issue in one area it does not affect other areas Contractual transfers - Correct Answer-A contract that will among other things transferred the community associations legal responsibility for any loss. Also known as a hold harmless Sources of insurance requirements - Correct Answer- Association governing documents Local state and federal law Secondary mortgage market agency and lender requirements Contractual obligation's Good business judgment pg. 20 professoraxe l Types of insurance coverages - Correct Answer-Property Liability Income Personnel Covered causes of loss - Correct Answer-The losses (perils) that are covered by insurance policy Insurance - Correct Answer-Transfers the financial burden of paying for certain losses to a third-party Special form - Correct Answer-Property insurance coverage that is the most comprehensive and ensures against everything that is not excluded. it allows extra coverage on items Broad form - Correct Answer-Property insurance coverage that only ensures specified perils. Basic form - Correct Answer-Property insurance that provides the least property coverage. pg. 21 professoraxe l Commercial package policy insurance (CPP) - Correct Answer- Includes property and liability Property insurance coverages and endorsements - Correct Answer-Commercial policy package Mechanical, equipment breakdown insurance Ordinance, law insurance Flood insurance Electronic data processing insurance Real property insurance - Correct Answer-Buildings land and information Personal property insurance - Correct Answer-Inventory, furniture, fine arts, equipment, supplies, machinery and valuable papers and records that belong to the community association pg. 22 professoraxe l the right of an owner. This typically gives the responsibility to the tenant Owner occupied single-family home insurance policies - Correct Answer-HO-1 HO-2 HO-3 HO-5 Tenants Insurance policy - Correct Answer-HO-4 Policy specifically for a condominium or cooperative unit owner - Correct Answer-HO-6 Claims made - Correct Answer-Whatever company is ensuring the association one at the claim is made it will cover the loss even though the wrongful act may have occurred one another carrier was insuring the association Aggregate limits - Correct Answer-Limits to the total amount that the insurer will pay out under the policy pg. 25 professoraxe l Manager - Correct Answer-A person with the responsibility and authority to direct operational activities of the team by executing and implementing the leadership plan and scheduling resources Leader - Correct Answer-Defined as someone people choose to follow Forms of management - Correct Answer-Volunteer Association employed manager Management company Management plan - Correct Answer-A statement of goals and objectives approved by the board, including task that address the community associations governance, business, and community operations Transition - Correct Answer-The general process by which the control and responsibilities of the governing board of an association or transferred from the developer to the persons who bought units in the association pg. 26 professoraxe l Turn over - Correct Answer-The date upon the owners gain control of their association Progressive discipline system - Correct Answer-A procedure whereby performance problems are brought to the employees attention, and the employees and employers take appropriate actions to correct them Parliamentary procedure - Correct Answer-Motion Second the motion Discussion Vote Debate - Correct Answer-A term used in parliamentary procedure for discussing a motion or issue Manager's role - Correct Answer-Support staff Professional advisor Support staff - Correct Answer-Ensure that meetings are well prepared and board members have the necessary information at a time pg. 27 professoraxe l