Since the beginning of the COVID-19 pandemic, the community association industry has been pushed to rapidly adopt new technology in order to continue to meet the needs of homeowners and board members. From online board meetings to paperless accounting practices, these new processes have impacted many aspects of community life. In many cases, they have also proven to be a major benefit for communities and may permanently change the way associations are run.
As the President of Sharma & Associates, a CPA firm based in South Florida, Vishnu Sharma has had a front-row seat to witness this rapid change. His firm’s scope of practice ranges from auditing to day-to-day accounting, and handles almost 100 associations. Vishnu is also a member of the CAI Board of Trustees and the chair of the Florida Institute of CPAs Committee.
During a recent interview with Beth Gilbert, Senior Director of the Community Association Market at AppFolio, Vishnu talked about how his firm has adapted to the disruption caused by the COVID-19 pandemic by going fully paperless.
Listen to their conversation to find out how Vishnu and his team used technology to better support homeowners and board members during this time, and why they’re never going back to their old processes.
- “Just last night, we passed a special assessment for $4.8 million via Zoom. So we’re learning, and we’re adapting. And I think that as we learn and adapt, we won’t be able to go back to a lot of the old ways because we’ve learned the new way works.”
Vishnu and his team have seen associations rapidly move board meetings online. For many of them, this format has proven to be just as conducive to participation as in-person board meetings, and it has not stopped them from accomplishing major milestones, such as new special assessments.
- “Today, my staff can run these reports, save them and consolidate them into one document, all electronically. They then email the digital document directly to the client and save a copy without generating a single physical copy. It’s amazing, and I can’t see us going back from that.”
Vishnu’s CPA firm used to rely heavily on paper-centric processes and reports to communicate with clients. Since COVID-19 has made it impractical to continue in-person meetings and send physical documents, they’ve adapted by providing these same reports in a digital format. It has made life easier not only for them, but for clients as well.
- “Even with all that’s going on now and as much of a learning curve that exists during this time, some of those fears [of technology] are so entrenched in certain communities and within some people that you can’t get past it.”
Although Vishnu and the team have found major advantages by going paperless during the COVID-19 pandemic, not all associations have welcomed this change. It’s understandable that associations who have relied on tried-and-true offline processes for years would be hesitant to try something new — but according to Vishnu, those who have embraced technology have had an easier time adapting to the challenges caused by the pandemic.
- “We shouldn’t be afraid of technology; instead, we should learn how to embrace it and open ourselves up to the opportunity it brings. It’s going to revolutionize everything we do within the community association industry. “
Vishnu emphasized how important it is for associations to remain open-minded and lean into change. New technology often brings opportunities for efficiency and better communication — and community associations who embrace it will be well prepared to overcome any future challenges.
This interview has been edited for clarity and length.
Beth: Hi Vishnu. Thank you so much for being here with me today as part of this COVID interview series. Before we begin, please tell us about yourself, your CPA firm, and how your company works within the community association industry.
Vishnu: Hey Beth, thanks so much for having me. I appreciate the opportunity to be able to share the South Florida experience as well as the perspective from a CPA firm. Our firm’s scope of practice ranges from auditing to day-to-day accounting, handling almost 100 associations. As a result, we interact constantly with community associations throughout South Florida. We’re based in Fort Lauderdale, but we handle the Tri-County area. I’m also a member of the Community Associations Institute (CAI) international board of trustees, an organization that comprises, as you know, 43,000 members worldwide. So, we know a lot about what’s going on in the industry and understand how these events are impacting different associations around the country. I’m also very active here in Southeast Florida with CAI and serve as the chair of the Florida Institute of CPAs Committee, which governs condo and HOA accounting rules.
Beth: It’s wonderful that you have so much experience to share with us. And, of course, you can provide insights into what’s going on right now in the scene. Let’s discuss COVID-19 and its impact on the community association industry. What have been your experiences as to its impact on the field?
Vishnu: The disruption caused by COVID-19 has been massive, and, in fact, it’s the type of disruptive event that only happens every hundred years or so. We have a unique climate in South Florida, in that we deal with hurricanes on a regular basis, so we understand that kind of disruption. But COVID-19 has presented disruption at a level that nobody has ever experienced before. For instance, how do you separate people to keep them safe from contagion? Our response has been something as simple and mundane as closing down the pool and the gym.
Furthermore, our response has had to take place in stages. At first, we removed the furniture or spaced chairs and tables apart, but then, we simply had to shut down the entire area. Next, we had to ban all visitors from the building, so nobody could visit their family members or friends. Also, any work that was being performed in owners’ units had to stop.
Vishnu: Owners who were in the middle of renovating their units had to completely stop work. No outside contractors were allowed into the communities.
These are just a few examples, but the disruption has been tremendous. An elderly owner actually passed away in one unit. This event caused that association’s owners to experience a whole new level of understanding of what it means to die of a highly contagious disease. They saw the HAZMAT team come in to remove the person and the type of cleaning that had to take place. So, it’s all simply brand new for everyone involved.
And these are just our experiences as a business partner with the association. If you’re in the service industry, you’ve had to modify your behaviors, and if you work for trade or construction companies, you also have had to dramatically change how you perform your duties.
Beth: Since we lack your perspective, let’s discuss your experiences in that area. Please share a little bit more about your experiences from a service standpoint.
Vishnu: If you’re a law firm, you probably can work remotely, and remote work was possible before COVID. Since we’re a CPA firm, we’re considered an essential industry in that bills must be paid. We still have to pay our bills, so my firm had to change the way we performed our everyday tasks. For instance, our weekly packets no longer came via paper “hard” copies. The associations had to scan and send electronic copies to us. Additionally, in three of our associations, someone in the administrative office was diagnosed with COVID.
Beth: Oh, wow.
Vishnu: As a result, we also immediately changed our processes, so we could reduce the interaction between us and the associations. We don’t have that many people from the outside coming in, but we did interact with the couriers and the courier packets that went back and forth. So, we had to stop transferring all this documentation and go electronic. Now, all the documentation is emailed electronically or uploaded through Dropbox.
Vishnu: We ended up changing our processes in a number of different ways. We’re a CPA firm, and we work with many contractors who, in turn, work with our associations. These contractors had to put a screeching halt to all their construction unless it was on the outside of the building. These construction companies run from week to week: They must make a weekly payroll. So, they had to lay off many of their employees. It’s had a dramatic impact on these companies and many other industries.
Beth: Thank you for sharing that. What do you think has been the biggest learning experience for the industry going through all this?
Vishnu: Our biggest learning experience has been in how we had to learn how to react to something that’s so different, which we had never come across before. We’re all accustomed to putting up hurricane shutters. We’re all used to notifying and emailing and alerting people about various things. But it’s been a learning process for both management and the owners. We all had to be willing to abide by the rules, because every community association, as we all know, can put out whatever rule they want.
And those people always exist who want to party at 10:00 p.m. on a Friday night down by the pool, even though the rule says that at 9:00 everything is supposed to shut down. When people’s health and their lives are at stake, how do you enforce these kinds of rules?
It’s also been a problem getting people to wear masks in the building. For example, we were out the other day at a Whole Foods, and a guy came in who wasn’t wearing a mask and had his 6-year-old son in the shopping cart. The manager had to run back in to say, “You need to have a mask on.” And the guy started asking… almost growling at the manager, telling him it was a hoax, and he can’t believe everybody’s being sucked into this.
So 99.9% of the shoppers in there were wearing masks and abiding by the rule, but you always still have those people, that percentage who is going to act this way. It’s the same in a community association. You always have someone who feels as if the rules don’t apply to them or they’re optional.
Beth: That’s definitely a challenging situation. We’ve heard that quite a bit from the management companies who are helping to ensure that their communities are safe and following these rules. Now we’ve been into this for several weeks, and we’re beginning to look ahead. Once this crisis is behind us, how do you see it impacting or changing the community association industry next year and beyond, looking forward?
Vishnu: I don’t think things are going to go back to how they were. A dichotomy exists out there, and it’s been fascinating to watch. So, for example, in our world, we learned about the software technology that’s available that allows associations to process payments electronically. An entire cloud-based solution is available, but I have so many associations that three-fourths of them were still using a manual system. When all this started, we told those associations about the cloud-based systems, and we offered to offset the cost of implementing one for them. But, no, they want a physical check because they don’t trust anything else, and they’re afraid of technology. And even with all that’s going on now and as much of a learning curve as exists during this time, some of those fears are so entrenched in certain communities and within some people that you can’t get past it.
On the other hand, I think that our business partners, the solution providers and even the management companies themselves have all learned that before COVID, we were guilty of following the same processes for five or even 10 years. And we broke those molds because we had to, so now we’re using technology like Zoom meetings. You and I are talking on a Zoom meeting right now. Now, I have six Zoom meetings a week. But if you had asked me four weeks ago about Zoom, I would not have been able to tell you what it was. Now, most of us know how to use it, and I have interviews with new clients via Zoom. I’ve had board meetings; in fact, just last night, we passed a special assessment for $4.8 million via Zoom. So we’re learning, and we’re adapting. And I think that as we learn and adapt, we won’t be able to go back to a lot of the old ways because we’ve learned the new way works.
Beth: How do you feel about that? For instance, is it kind of refreshing to think that maybe we can look at new ways of doing things in light of this and come out ahead to move the industry forward? Or, are there still some concerns about that?
Vishnu: I think two good things are going to come out of this. Firstly, it’s forced us into making adoptions and changes, and, secondly, it gave us the time to do it. Typically, when you want to make a change, there’s pushback because people don’t like change. But when we were forced to change, for example, I told all our associations: “Look, we can no longer accept hard copy paper. You have to scan and email everything to us.”
Nobody challenged it. In all fairness, I have had only two associations who said, “We’re still going to send you what we’re going to send you.” But the other 58 associations said, “No problem. We understand. It makes sense.” So that helped, because when you do it in a moment of crisis, everybody’s on the same page.
And our staff has had the ability and the time right now to focus on what’s different and what we need to do differently. So, the change in mindset has helped as well.
But, by the same token, now that it’s in place, I don’t see it going backwards. The efficiencies we’re seeing in our paper reduction alone has been remarkable. For instance, we generate monthly financials that can run 50 to 100 pages every month. And we sometimes generate 18 different reports: bank statements, bank reconciliations and other documents. Previously, we generated all those reports separately, consolidated them into one physical packet after they put them together, scanned the packet, and then emailed it. Today, using the software solutions that are available, my staff has figured out a way that they can run these reports, save them and consolidate them into one document, all electronically. They then email the digital document directly to the client and save a copy without generating a single physical copy. It’s amazing, and I can’t see us going back from that.
Beth: You’re right. I’ve also heard this when talking to other management companies and other industry experts. The time that came about as a result of this crisis has been a huge factor in allowing them to evaluate and assess what they’re currently doing to see where to implement those changes. You can see how things are going to be different now.
You’ve mentioned technology. How do you see the relationship between the community association, the management professionals and technology changing or evolving? You talked about what you’re doing, so please speak more about it either from your perspective or what you’re seeing from the management side as well.
Vishnu: As to managing our business, now, our board meetings take place online. The adoption of videoconferencing has been widespread, because without it, no meeting can take place since we can’t meet in person. In most associations, especially here in Southeast Florida, for example, absentee owners are at their second homes, because many people live all around the country. But yet, by using videoconferencing platforms, these owners can participate in a process they couldn’t have beforehand based on simple geography.
Before this crisis, board meetings were not held via conference call; instead, you had to be there in person. But technology has provided the opportunity to bring communities together and allowed owners to become much more involved. And management companies have committed completely to these new opportunities and integrated the necessary software to implement these types of meetings. Doing so also gives management the opportunity to have a lot more control of the board meeting to prevent one person from potentially overtaking an entire meeting and even derailing the process.
Beth: That’s interesting. When you think about what’s going on, what is one practice or habit that has made you more successful in working through this period of uncertainty?
Vishnu: I think the efficiency of what we do and the way we interact with our associates have helped us achieve success. And, on a lighter note, we probably have eliminated at least four reams of paper a month!
This experience forced us to learn to do things electronically, which has been a huge benefit. It’s simple to monitor setups for every person, so you can bring up a document on one screen and enter it on a second screen. We also now have the ability to use software to generate reports and consolidate them.
The amount of time that I spend each week in a car driving from meeting to meeting, while traversing a 100-mile radius, has been reduced, if not eliminated. The ability to do Zoom meetings, which our associations love because the president is in New York; the treasurer is in Los Angeles; and the properties are in Sunny Isles, has been hugely beneficial. Now we have the ability to pull everybody together in a face-to-face meeting. No one has to leave the comfort of their home, and it simply seems to work all the way around. So, all this came about from this terrible event, but it has been amazing. And we’re not going back to the old way.
Beth: I hear that a lot. This event has proven that we can overcome difficult situations and be resilient. At the onset, it was definitely shocking, but we’ve taken the time to learn how to navigate through it. And some things are here to stay, which is great to see. If you could share one piece of advice or tip for this industry, what would it be?
Vishnu: Thomas Friedman, the editor of a very large newspaper, was interviewed the other day, and he made a statement that’s tied to Charles Darwin. Charles Darwin said it, but a professor from LSU back in the ’60s paraphrased Darwin to come up with this advice: “The most intelligent people won’t survive. The strongest people won’t survive. The ones who are the most adaptive will survive.”
And I think that’s exactly what we’ll all take away from this. You can be the biggest, most powerful company, such as the airlines industry. And they, like the hotel industry and many other large businesses, are multi-billion-dollar players. The only ones that survive this, however, are the ones that are best able to adapt to whatever the new norm becomes and to adapt as quickly as possible.
And the same theory holds true for my firm CPA, a management company within the associations. If we’re not able to adapt to the new norm and figure out a way to keep the community together, to communicate with everybody in different places, we too will fail. So, make the effort to get those messages out. The ability to use technology to best effect is critical. We’re fortunate to live in 2020, an age in which so much technology is available.
Moreover, we must learn how to use the technology we have and not be afraid of it. My takeaway on Darwin’s adaptive concept is that we shouldn’t be afraid of technology; instead, we should learn how to embrace it and open ourselves up to the opportunity that it brings. It’s going to revolutionize everything that we do within the community association industry. In just six weeks, technology has revolutionized our lives more than it has in probably the last three or four years, because we’ve adopted it, even though our adoption was forced.
Beth: And this is such an interesting way to wrap up your remarks. I can’t thank you more for being here with me today and discussing this situation. We are getting through this, and to your point, we are learning to be more open, to be more adaptive while getting through this and continuing to serve this market as we always have, but in new ways. Vishnu, thank you so much. I appreciate your time today. And with that, we’ll conclude.
Vishnu: Thank you, Beth.
Beth: Thank you.
The post How One CPA Firm Is Supporting Community Associations By Going Paperless appeared first on The Official AppFolio Blog.