Levels of Service Selection Guide

By: Robert M. Nordlund, P.E.

We want you to feel confident selecting the right Level of Reserve Study for your Association. Sound business judgement and Generally Accepted Accounting Principles (GAAP) encourage you to annually evaluate and adjust your Reserve Study due to the natural physical and financial changes at your association. Some states have additional legal requirements. To help you make the right choice, we have formulated the following guide.

Level I: "Full" Reserve Study.

This is our most comprehensive product, designed for associations perform-ing a Reserve Study for the first time or for associations with concerns about the accuracy of their Reserve Component List and measurements. A thorough site inspection is performed to develop the Reserve Component List (Component Description, Useful Life, Remaining Useful Life, and Replacement Cost), summarized with a printed color photographic inventory. From this Physical Analysis we perform a Financial Analysis (an evaluation of your current Reserve Fund Strength and a recommended ongoing Reserve Funding Plan), compiled all together into an easy-to-understand Report.

Level II: "Update With Site Visit" Reserve Study.

This product is for associa-tions confident their Reserve Components and measurements are accurately listed. It is a good choice if you have large or complicated Reserve Components, are approaching or just finishing major projects, or if you have not had a reliable on-site inspection within the last three years. An on-site inspection is performed to update existing life and cost figures but not to re-quantify all components, and is summarized with a printed color photographic inventory. From this updated Physical Analysis information we prepare the Financial Analysis and assemble this useful planning document.

Level III: "Update No Site Visit" Reserve Study.

This product also is for associations confident their Reserve Components and measurements are accurately listed, but who due to mild weather, minimal Reserve projects, or a simple set of Reserve Components do not feel an on-site inspection is necessary to accurately update existing life and cost factors. In this product we update the Reserve Component List based on interviews and a review of association information, not an on-site inspection. From this updated Physical Analysis information we prepare a Financial Analysis which cost-effectively gives useful budget guidance.

Level IV: "Do-it-Yourself Kit" Reserve Study.

This is designed as a "first-time" product for cost-conscious associations capable of compiling their own Reserve Component List, or as a very cost-effective "update" product for associations capable of establishing current life and cost factors from their existing Reserve Component List. In this $349 product ($299 for Updates), we perform the Financial Analysis and prepare the Report based on the Reserve Component List information the client has compiled with the help of our workbook.


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