The AGM, explained: what Victorian owners decide each year

The annual general meeting is the once-a-year meeting of all lot owners, and it is where the year is set: the financial statements are presented, the committee is elected, the fees are decided, and the maintenance plan is put in front of the people paying for it. Every lot owner is entitled to notice, to attend and to vote.

What has to be presented

• Annual financial statements, prepared in accordance with the Australian Accounting Standards for tiers 1 to 3 (with an audit required at Tier 1), and for any year that Tier 4 levies annual fees.
• The budget and the fees proposed for the coming year.
• The maintenance plan and the position of the maintenance fund, so owners can see what major works are coming and whether the fund covers them.
• Insurance — the cover in place, its limits and the premium.

Electing the committee

Tiers 1 to 3 must elect a committee at the AGM; the other tiers may choose to. A committee must have at least three and no more than seven members unless the owners corporation resolves to allow up to 12. Members take on duties to act in the interests of the owners corporation and not to use their position for personal advantage — something worth remembering when a committee seat looks like a way to win an argument about a car space.

Setting the fees

The AGM is where owner liability is fixed for the year, and where the split between running costs and the maintenance fund is decided. Owners who want to understand their own notice should read the budget alongside their lot liability: the fee follows that figure, not the apartment.

Resolutions and what majority each needs

• Ordinary resolution — a simple majority of votes. Most decisions.
• Special resolution — a 75 per cent majority. Changing the owners corporation’s rules is the common example.
• Unanimous resolution — every lot owner agrees. Changing lot entitlements or lot liabilities.

If you cannot attend, the Act sets out how an owner can appoint a proxy to vote on their behalf — check the notice for the process and the deadline.

Preparing, as a committee

• Send the notice and the papers with enough time for owners to read them, not the day before.
• Present last year’s decisions and what happened to them — the fastest way to make a meeting feel worthwhile.
• Bring quotes for anything material, with a recommendation, rather than asking the meeting to decide cold.
• Minute decisions precisely, with who is responsible and by when.

Getting value from it, as an owner

Read the financial statements before the meeting and compare them with the budget you approved last year. Look at the maintenance fund balance against the works in the plan. If something does not reconcile, that is the question to ask — and it is easier to ask it at the meeting, on the record, than afterwards.

Where to go next

The terms above are defined in the owners corporation glossary; resources covers the shorter questions about meetings, committees and records. If your committee wants its meetings, minutes and financial reporting run properly, get in touch.