In the second installment of our special investigative awards series, The Governance Ledger examines recurring tax, audit, and financial reporting patterns involving two community association CPA firms serving major Chicago condominium associations.
This award is based on duration of financial patterns, magnitude of impact, and relevance to financial statement users — including unit owners, prospective buyers, and lenders — not isolated errors.
Key Findings
- 🚫 8 consecutive years of $0 federal tax on $1.3MM of interest income (2015–2022)
- 📉 58% of passive interest income shielded from tax in the most recent year
- ⚠️ $1.9MM alleged taxable income understatement (2023) – formal complaints filed
- 📄 $500K+ audited financial statement overstatements – formal complaints filed
- 💼 Nearly $500K in undocumented compensation growth over ten audit cycles
- 🏗 Reserve study projections reflecting significant long-term unfunded liabilities
The article analyzes tax posture shifts, reserve study disclosure obligations under Illinois law, auditor independence considerations, and structural governance risks that may affect association funding stability and future assessments.
🔓 No paywall — this second part of the special series is fully open to the public in the interest of transparency.
