Use this guide to connect the Georgia Community Association Manager Licensing Examination’s legal and financial foundations with everyday association decisions. Each concept includes an original worked example and a specific error to avoid. Read the foundations first, then use the applications to practice identifying authority, interpreting documents, comparing options, and checking calculations.
Property Law and Forms of Ownership
1. Real Property, Personal Property, and Fixtures
Real property includes land and improvements attached to it; personal property generally consists of movable items. A fixture begins as personal property but becomes associated with the real estate through attachment, adaptation, and intent. Classify an item using the relevant documents and circumstances rather than treating physical attachment as the only consideration.
Worked example: A clubhouse’s built-in reception counter is treated as an improvement, while freestanding folding tables remain movable equipment. The inventory therefore lists the tables separately from the building.
Mistake to avoid: Assuming everything located inside a building automatically transfers with the real estate.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
2. Ownership and Possession
Ownership identifies who holds a property interest; possession identifies who occupies or controls the space. These can belong to different people. A lease can give a tenant possession without transferring ownership. Association communications should distinguish the owner responsible under governing documents from the occupant who needs practical information about access or use.
Worked example: A rented unit has a leaking balcony door. The manager sends the maintenance coordination message to the resident and the ownership responsibility notice to the owner.
Mistake to avoid: Treating an occupant as the owner merely because the occupant lives in the unit.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
3. Condominium Ownership and Association-Owned Amenities
A condominium generally combines ownership of a defined unit with an undivided interest in common elements. In another community structure, owners may hold their lots individually while the association owns amenity parcels. Similar appearances do not establish identical ownership. Recorded documents determine boundaries, interests, and the association’s relationship to shared property.
Worked example: Two communities have pools. One declaration identifies its pool as a condominium common element; the other community’s deed places the pool parcel in the association’s name.
Mistake to avoid: Inferring the ownership structure from the presence of shared amenities.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
4. Cooperative Ownership
In a cooperative, an entity typically owns the property, while residents hold ownership interests in that entity and occupancy rights under an agreement. This differs from receiving a deed to an individual condominium unit. Identify both the entity interest and the occupancy document before interpreting a transfer, payment obligation, or use restriction.
Worked example: A cooperative resident transfers shares and the associated occupancy agreement. The manager checks both documents rather than requesting a deed to a separately owned apartment.
Mistake to avoid: Using condominium ownership terminology for every shared residential building.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
5. Common and Limited Common Elements
A common element serves the ownership community collectively; a limited common element is generally reserved for the use of specified units. Exclusive use does not necessarily mean individual ownership or individual maintenance responsibility. Read the designation and the maintenance allocation separately, because the governing documents may assign those responsibilities differently.
Worked example: A declaration reserves a balcony for Unit 12 but assigns structural balcony repairs to the association. Exclusive use therefore does not make the structural repair the owner’s responsibility.
Mistake to avoid: Equating exclusive use with responsibility for every repair.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
6. Easements and Permitted Use
An easement gives a defined right to use another party’s land for a particular purpose without transferring ownership of that land. Its scope matters: access, drainage, and utility rights are different interests. Locate the affected area and read the permitted purpose before approving work that could obstruct or alter its use.
Worked example: A recorded drainage easement crosses a landscaped strip. The manager excludes that strip from a proposed storage enclosure because the enclosure would interfere with drainage access.
Mistake to avoid: Treating an easement as unrestricted ownership of the affected land.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
7. Encroachments and Boundary Evidence
An encroachment occurs when a physical improvement extends across a property boundary or into an area where it lacks permission. An easement, by contrast, is a right to use property. A survey can establish location, but resolving ownership rights or removal obligations may require document review and qualified legal advice.
Worked example: A survey places an owner’s fence beyond the lot line. The manager documents the location and refers the boundary issue for review instead of assuming landscaping plans establish permission.
Mistake to avoid: Treating a longstanding physical structure as proof of a legal right.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
8. Private Restrictions and Public Land-Use Controls
Private covenants and public land-use controls come from different sources. Association approval addresses the association’s restrictions; a governmental permit addresses applicable public requirements. Receiving one approval does not automatically satisfy the other. Evaluate a proposal against each relevant source, including restrictions that remain applicable after a permit is issued.
Worked example: An owner obtains a permit for a shed, but the declaration requires architectural approval. The manager explains that the permit does not complete the association’s review.
Mistake to avoid: Assuming a building permit overrides private restrictions.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
9. Debt and Liens
A debt is an obligation to pay; a lien is a claim against property that may secure an obligation. Recording an amount in an owner ledger does not itself establish an enforceable lien. The governing documents and applicable law determine whether a lien exists and what procedures, priorities, and remedies apply.
Worked example: An account shows an unpaid assessment. The manager reports the balance accurately but obtains authorized legal review before describing the property as subject to a perfected lien.
Mistake to avoid: Assuming every unpaid charge automatically creates the same lien rights.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
10. Legal Descriptions and Recorded Plans
A street address helps locate property, but a legal description identifies the property interest in legal instruments. Recorded plats and condominium plans can clarify lot boundaries, unit boundaries, and shared areas. Match the document’s description to the relevant recorded plan rather than relying solely on addresses or informal site labels.
Worked example: A maintenance map labels an area 'north lawn,' but the recorded plat divides it between two parcels. The manager uses the parcel descriptions to assign responsibility correctly.
Mistake to avoid: Using an informal property nickname as a substitute for a legal description.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
Agency, Licensing, and Professional Duties
11. Identifying the Principal
Agency involves acting on behalf of a principal within an authorized relationship. In association management, identify the contracting client and how that client communicates decisions. An association’s interests are not automatically identical to the preferences of an individual director, owner, or resident. The management agreement helps establish the relationship.
Worked example: The association contracts for management services. A director requests a personal landscaping favor; the manager treats it as an individual request rather than an association instruction.
Mistake to avoid: Treating every director’s personal preference as a direction from the client.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
12. Actual Authority and Apparent Authority
Actual authority comes from the principal’s authorization. Apparent authority concerns reasonable third-party reliance on the principal’s conduct suggesting that an agent has authority. Internal spending limits and external representations should align. A manager should verify authority before committing the association and avoid communications that suggest broader powers than were granted.
Worked example: A management agreement authorizes purchases up to $2,000. A $7,500 proposal requires additional approval, so the manager obtains it before accepting the vendor’s offer.
Mistake to avoid: Assuming responsibility for a task includes unlimited authority to bind the association.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
13. Loyalty and Conflicts of Interest
Loyalty requires placing the principal’s interests ahead of an agent’s conflicting personal interests. A financial relationship with a vendor can distort purchasing decisions even when the vendor performs well. Disclose relevant interests and follow the applicable approval process; disclosure does not by itself make an unsuitable transaction acceptable.
Worked example: A manager’s sibling owns a bidding company. The manager discloses the relationship and removes personal influence from the documented comparison and authorized selection process.
Mistake to avoid: Hiding a vendor relationship because the proposed price appears competitive.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
14. Reasonable Care and Documented Verification
Reasonable care means using the competence and diligence appropriate to the assignment. It includes checking material information rather than passing along assumptions as facts. Documentation should show what was reviewed, what remains uncertain, and who must resolve it. The need for a specialist increases when the question exceeds ordinary management competence.
Worked example: Two roof estimates use different replacement areas. The manager requests measured quantities before recommending a bid, preventing a misleading comparison of headline prices.
Mistake to avoid: Presenting an unchecked vendor assumption as an established property fact.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
15. Confidentiality and Authorized Disclosure
Confidential information should be shared only for an authorized purpose and with appropriate recipients, subject to applicable disclosure obligations. Association business can involve financial records, personal contact details, and sensitive accommodation information. Separate information needed for a decision from personal details that do not help the recipient perform an authorized role.
Worked example: A board receives an account collection report through a restricted channel. The manager excludes that owner-specific report from the community’s general newsletter.
Mistake to avoid: Assuming all association information belongs in every owner communication.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
16. Accounting for Entrusted Funds
An agent handling another party’s money must maintain a clear record of receipts, disbursements, and balances. Funds need traceable ownership and purpose; personal or company funds should not obscure association transactions. Operational controls and current applicable account requirements govern handling, while accurate ledgers support both financial reporting and accountability.
Worked example: A payment received for Association A is recorded to A’s owner ledger and designated account, rather than being used to cover Association B’s vendor invoice.
Mistake to avoid: Using one client’s money as a temporary advance to another client.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
17. Material Information and Honest Reporting
Information is material when it could meaningfully affect a decision. Honest reporting requires distinguishing observations, estimates, and confirmed findings. A manager should not conceal a known problem to make a recommendation easier to approve. Communicate the issue, its practical consequence, and the next action needed without inventing conclusions beyond the evidence.
Worked example: A contractor reports that hidden damage may increase a repair price. The manager includes that uncertainty in the board recommendation instead of presenting the initial quote as final.
Mistake to avoid: Omitting an unresolved cost risk because it complicates approval.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
18. Active Status and Broker Affiliation
Georgia’s CAM licensing information distinguishes inactive status from activation with a Broker. License status and brokerage affiliation are separate from being hired by an association or management company. Check the regulatory status before accepting work that requires an active license, and keep employment arrangements consistent with the applicable brokerage relationship.
Worked example: A person holds an inactive CAM license and receives a management job offer. The offer alone does not activate the license; the required activation and affiliation must be addressed.
Mistake to avoid: Assuming an employment contract changes regulatory license status.
Source: Real Estate – Georgia
19. Passing the Examination and Holding a License
Passing the CAM examination is one step toward licensure, rather than the license itself. The candidate bulletin expressly distinguishes passing from becoming officially licensed and restricts acting or holding oneself out as a Georgia real estate licensee before licensure. Verify official status before beginning activities that require that status.
Worked example: A successful candidate prepares an advertisement describing herself as a licensed CAM. She withholds that claim until her license has actually been issued.
Mistake to avoid: Advertising licensed status solely on the strength of a passing examination result.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
20. Delegation and Continuing Oversight
Delegating a task does not eliminate the need to define limits and monitor performance. Distinguish permission to prepare a transaction from permission to approve it. Written workflows should identify who enters information, who checks supporting records, and who can authorize commitments. This reduces errors without pretending every employee has the same authority.
Worked example: An assistant enters invoices, but an authorized approver checks the contract and payment amount. Invoice entry therefore cannot create payment authorization by itself.
Mistake to avoid: Giving system access without defining what decisions the user may make.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
Association Governance and Board Operations
21. Reading Governing Documents Together
Declarations, bylaws, rules, and applicable law serve different functions and must be read together. A rule should not be assumed to expand authority beyond its governing source. When documents conflict, identify the controlling provision through proper review rather than choosing whichever wording makes the proposed action easiest.
Worked example: A board rule appears to permit a use that the declaration restricts. The manager flags the conflict for review instead of treating the newer rule as an automatic amendment.
Mistake to avoid: Assuming the most recently adopted document always controls.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
22. Board Decisions and Management Implementation
The board’s decision-making role and the manager’s implementation role should be defined by governing documents and the management agreement. A manager may recommend options and carry out authorized actions without acquiring every power reserved to the board or membership. Identify the decision-maker before turning an operational proposal into a commitment.
Worked example: The manager compares three security proposals. The board selects an authorized option, and the manager then coordinates implementation within the approved scope.
Mistake to avoid: Treating preparation of a recommendation as permission to approve it.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
23. Committees and Delegated Powers
A committee may investigate, recommend, or decide within a defined delegation. Its name does not establish its powers. Read the charter, governing documents, and board authorization to determine what it can do. Recommendations should be clearly distinguished from binding approvals so vendors and owners do not rely on an unauthorized commitment.
Worked example: A landscaping committee recommends a planting plan but lacks spending authority. Its endorsement goes to the board before the manager places an order.
Mistake to avoid: Assuming an advisory committee can authorize contracts.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
24. Quorum and the Ability to Conduct Business
Quorum is the required participation needed to conduct specified business; it is different from the votes needed to approve a proposal. Calculate it using the governing provision’s denominator and counting rules. Attendance, proxies, and voting interests may be treated differently, so the calculation must follow the stated requirements.
Worked example: Documents require 30% of 80 eligible voting interests for quorum. Twenty-four interests are needed; representation of only 22 does not meet that requirement.
Mistake to avoid: Calculating quorum from the number who happen to attend.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
25. Voting Thresholds and Their Denominators
A voting threshold has both a percentage or proportion and a denominator. A majority of votes cast can produce a different result from a majority of all eligible interests. Read the exact provision, including treatment of abstentions and fractional results, before announcing whether a motion passed.
Worked example: With 80 eligible interests and 30 votes cast, 18 affirmative votes exceed half of votes cast but do not exceed half of all eligible interests.
Mistake to avoid: Applying the same denominator to every association vote.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
26. Minutes as a Record of Decisions
Minutes record the meeting’s official actions rather than reproducing every conversation. Useful minutes identify the meeting, relevant participation, motions, decisions, and assigned follow-up. Record the approved action precisely enough that a later reader can distinguish the board’s decision from an idea mentioned during discussion.
Worked example: Directors discuss several paint colors but approve only obtaining samples. The minutes record the sample request, not approval of a final color.
Mistake to avoid: Recording a discussed option as though the board adopted it.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
27. Consistent Enforcement and Procedural Checks
Enforcement should connect a documented condition to an applicable restriction and the authorized process. Check notice, response opportunities, decision authority, and available remedies rather than inventing a penalty. Consistent treatment requires comparing relevant circumstances while recognizing that legally required exceptions or different facts can justify different outcomes.
Worked example: Two similar storage violations receive the same initial notice under an established procedure. The manager does not add an immediate fine that the process has not authorized.
Mistake to avoid: Skipping procedural requirements because the violation seems obvious.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
28. Architectural Review Against Stated Criteria
Architectural review evaluates a proposed alteration against applicable authority and documented criteria. Separate aesthetic requirements from ownership boundaries, structural issues, and public approvals. A clear decision identifies which criteria were met or not met; a manager should avoid substituting personal taste for the association’s adopted standards.
Worked example: An application specifies a fence higher than the adopted standard permits. The review identifies the height discrepancy and requests a compliant revision.
Mistake to avoid: Approving or rejecting a proposal solely because a reviewer likes its appearance.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
29. Records Access and Sensitive Information
A records request requires identifying the requested record, the requester’s applicable rights, and any information requiring protection. Access rules and exceptions must be checked rather than assumed. Preserve the underlying record and use authorized redaction or restricted delivery when appropriate, so providing association information does not unnecessarily disclose unrelated sensitive data.
Worked example: An owner requests a vendor contract containing bank details. The manager checks access requirements and provides the appropriate contract copy with authorized protection of sensitive payment information.
Mistake to avoid: Either releasing every detail or refusing the entire request without reviewing the applicable rules.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
30. Transition and Operational Handover
A management or control transition requires transferring usable information, not merely boxes of papers. Reconcile governing documents, contracts, financial balances, owner ledgers, warranties, access credentials, and pending issues. Verify what was received and identify gaps. Possession of a document does not prove that its obligations or balances have been checked.
Worked example: A new manager receives a reserve bank statement but no reconciliation. The handover lists the statement as received and the balance reconciliation as unresolved.
Mistake to avoid: Treating receipt of records as confirmation that the records are accurate and complete.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
Contracts, Vendors, and Real Estate Instruments
31. Contract Formation and Validity
An enforceable contract generally requires agreement, consideration, competent parties, and a lawful purpose, with any applicable form requirements satisfied. A signature does not cure every defect. Identify the parties, their authority, the promised exchange, and required documentation before treating a vendor proposal or management arrangement as an enforceable obligation.
Worked example: A repair agreement names the association, defines the work and price, and is accepted by its authorized representative. Those facts support formation more clearly than an unsigned brochure.
Mistake to avoid: Assuming every signed paper is valid regardless of authority or required terms.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
32. Offers, Acceptance, and Counteroffers
An offer proposes terms that can be accepted; a counteroffer changes those terms and seeks a new agreement. Distinguish discussing a price from accepting a contract. Before scheduling work, verify that both sides agreed to the same scope, price, and other material conditions, using the contract’s required acceptance method.
Worked example: A vendor offers repairs for $9,000. The association replies that it will accept at $8,400; work is not authorized until the vendor accepts the revised terms.
Mistake to avoid: Treating a proposed change in price as unconditional acceptance.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
33. Measurable Scopes of Work
A scope of work should define the location, quantity, required result, exclusions, and acceptance criteria. Vague descriptions make bids difficult to compare and performance difficult to verify. Use observable deliverables instead of assuming that words such as 'complete service' or 'restore' mean the same thing to every bidder.
Worked example: A cleaning scope identifies four stairwells, weekly service, specified surfaces, and a completion log. The manager can check delivery against those requirements.
Mistake to avoid: Relying on a broad service label without defining what the vendor must deliver.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
34. Fixed-Price and Unit-Price Contracts
A fixed-price contract sets a price for a defined scope; a unit-price contract multiplies an agreed rate by measured quantities. Fixed prices depend on clear assumptions, while unit prices require reliable measurement and quantity controls. Compare the structure as well as the initial amount, especially when the quantity of work is uncertain.
Worked example: Paving repairs cost $45 per square yard. An authorized measured quantity of 120 square yards produces a $5,400 charge before any separately agreed items.
Mistake to avoid: Treating a unit rate as the total project price.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
35. Comparable Bids and Vendor Evaluation
Bid comparison requires consistent scope and a review of exclusions, qualifications, schedule, insurance requirements, and performance history. The lowest headline price can omit necessary work. Normalize the bids where possible and identify remaining differences so the authorized decision-maker understands what each option actually purchases.
Worked example: Bid A is $14,000 including disposal; Bid B is $12,800 plus $1,600 disposal. On that shared scope, B totals $14,400 and is not cheaper.
Mistake to avoid: Ranking bids before accounting for exclusions and additional charges.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
36. Change Orders and Scope Control
A change order documents an agreed modification to an existing contract, including its effect on work, price, and schedule. Verify who can approve it and whether the original contract defines a process. A field conversation can reveal a need for change without supplying authority to commit additional funds.
Worked example: A $20,000 project needs an additional authorized $2,300 repair. A signed change order records the added scope and revised total of $22,300.
Mistake to avoid: Allowing extra work to proceed without documenting approval and cost consequences.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
37. Payment Milestones and Acceptance
Payment milestones should correspond to verifiable contractual progress or accepted deliverables. An invoice is a request for payment, not proof that work meets the agreement. Check supporting evidence, completion status, and required approval before release, while respecting the payment terms rather than inventing new conditions after the contract is signed.
Worked example: A contract links the second payment to installed equipment. Equipment delivery alone does not satisfy that milestone, so the manager verifies installation before recommending payment.
Mistake to avoid: Approving payment solely because the invoice amount matches the contract.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
38. Breach, Cure, and Termination
A performance problem does not automatically authorize immediate termination. Review the contractual obligation, documented failure, notice requirements, cure provisions, and available remedies. Termination and expiration also differ: one ends an agreement under a relevant right or remedy, while the other follows its stated duration.
Worked example: A service contract allows ten days to cure after written notice. The manager documents missed service and follows that provision before recommending further action.
Mistake to avoid: Cancelling a contract without checking its notice and cure requirements.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
39. Deeds, Notes, and Security Instruments
Different real estate instruments serve different purposes. A deed conveys a property interest; a promissory note records a repayment promise; a security instrument connects an obligation to collateral. Review the instrument’s actual function rather than assuming all signed or recorded documents transfer ownership in the same way.
Worked example: An association reviews a clubhouse purchase file containing a deed, loan note, and security instrument. It identifies ownership transfer separately from repayment and collateral obligations.
Mistake to avoid: Treating the repayment note as the document that conveys the purchased property.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
40. Recordation, Notice, and Title Review
Recording makes an instrument part of the public record and can affect notice and priority under applicable law. It does not prove that every term is valid or reveal every possible claim. A title search, relevant surveys, and qualified review answer different questions and should not be replaced by checking a single recorded document.
Worked example: A recorded deed identifies an amenity parcel’s owner. Before planning improvements, the association also reviews recorded easements rather than assuming the deed establishes unrestricted use.
Mistake to avoid: Assuming recordation eliminates all title or use restrictions.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
Financial Management and Reserve Planning
41. The Accounting Equation
The balance sheet organizes assets, liabilities, and net assets using the equation assets equal liabilities plus net assets. Cash is only one asset, and an unpaid bill is a liability even if money remains in the bank. Check classification before interpreting a balance as money available for discretionary spending.
Worked example: An association has $90,000 in assets and $18,000 in liabilities. Its net assets are $72,000, because $90,000 minus $18,000 equals $72,000.
Mistake to avoid: Calling the entire bank balance the association’s financial surplus.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
42. Cash and Accrual Accounting
Cash accounting generally recognizes transactions when money moves; accrual accounting recognizes income when earned and expenses when incurred. The methods can show different results for the same period. Identify the reporting basis before comparing income, expenses, receivables, or unpaid obligations, and avoid interpreting an accounting surplus as equivalent to available cash.
Worked example: A $3,200 December service invoice is paid in January. It is a December expense under accrual accounting and a January expense under cash accounting.
Mistake to avoid: Comparing reports prepared on different accounting bases as though timing were identical.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
43. Building an Assessment Budget
A budget connects planned operating costs, planned reserve contributions, and other anticipated income to the amount assessments must provide. Keep each assumption visible and distinguish recurring income from a one-time receipt. The arithmetic establishes a funding proposal; the governing documents and applicable law establish how that proposal may be adopted.
Worked example: Operating costs are $144,000, reserve contributions are $36,000, and other income is $12,000. Assessments must provide $168,000; for 70 equally assessed units, that is $200 monthly per unit.
Mistake to avoid: Omitting reserve contributions when calculating the proposed assessment requirement.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
44. Allocating Assessments by the Governing Formula
Assessment allocation follows the applicable governing formula rather than an assumed equal split. Equal shares, stated percentages, and other authorized allocations can produce different owner charges. Confirm the formula and check that the allocations reconcile to the total amount before posting charges or preparing notices.
Worked example: A $40,000 authorized expense is allocated by stated interests. A unit with a 2.5% share receives a $1,000 allocation: $40,000 multiplied by 0.025.
Mistake to avoid: Dividing every cost equally when the documents specify percentage interests.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
45. Operating Funds, Reserves, and Cash Transfers
Operating funds support recurring services; reserves support planned major repair or replacement needs. A transfer between the association’s own cash accounts moves money without creating new association-wide income. Track designated balances and actual cash separately so a reserve transfer does not disguise operating performance or imply unrestricted spending authority.
Worked example: Moving $5,000 from operating cash to reserve cash leaves total cash unchanged. The transfer increases one account and decreases the other by the same amount.
Mistake to avoid: Reporting an internal account transfer as additional assessment income.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
46. Bank Reconciliation
Bank reconciliation explains differences between the bank statement and accounting records. Outstanding payments and deposits in transit adjust the bank side; unrecorded bank charges or receipts adjust the book side. Both adjusted balances should agree. An unexplained difference requires investigation rather than an unsupported entry made merely to force agreement.
Worked example: The bank shows $25,400, with $900 outstanding payments and a $500 deposit in transit: adjusted bank cash is $25,000. Books of $25,050 less a $50 bank fee also equal $25,000.
Mistake to avoid: Subtracting outstanding payments from the books a second time.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
47. Receivables Aging and Collection Information
A receivables aging report groups unpaid balances by how long they have been outstanding. It supports follow-up and cash forecasting but does not establish legal remedies by itself. Check charges, payment applications, credits, and disputes before escalating an account under the association’s authorized collection process.
Worked example: An aging report shows $600 overdue, but an unapplied $200 payment belongs to that owner. Applying it correctly reduces the balance requiring review to $400.
Mistake to avoid: Starting collection action from an aging report without checking the underlying ledger.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
48. Budget Variance and Its Cause
A budget variance compares actual results with the budget for a consistent period and accounting basis. Label whether a difference is favorable or unfavorable rather than relying on its sign alone. Investigate timing, quantity, rate, and unplanned work before treating the difference as evidence of good or poor performance.
Worked example: Year-to-date water expense is $11,200 against a $9,500 budget, an unfavorable $1,700 variance. A late bill may explain timing; a leak may explain increased consumption.
Mistake to avoid: Assuming every unfavorable variance proves overspending.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
49. Basic Reserve Contribution Planning
A simple reserve estimate subtracts available designated funds from an estimated future project cost, then spreads the remaining requirement over the time available. This introductory calculation excludes investment returns, inflation, and competing projects unless explicitly included. A full reserve plan must consider component timing and the association’s combined cash needs.
Worked example: A replacement estimated at $60,000 is due in five years, with $15,000 already designated. Ignoring other changes, the remaining $45,000 requires $9,000 annually.
Mistake to avoid: Presenting a simplified single-project calculation as a complete reserve plan.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
50. Future Replacement Costs
When a planning assumption applies a constant annual cost increase, future cost equals present cost multiplied by one plus the rate raised to the number of years. Use the assumption transparently; it is a scenario, not a guaranteed forecast. Revisit estimates when updated condition assessments or market quotations become available.
Worked example: A $40,000 project rising by an assumed 3% annually for three years becomes $40,000 × 1.03³, or $43,709.08 rounded to cents.
Mistake to avoid: Adding the annual increase only once for a multiyear estimate.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
51. Special Assessments and Borrowing
A special assessment raises owner contributions under applicable authority; borrowing supplies cash that must later be repaid with financing costs. A loan changes payment timing rather than eliminating the project’s cost. Compare cash needs, repayment burden, total financing expense, and approval requirements before recommending a funding approach.
Worked example: A project needs $80,000. Borrowing that amount provides project cash immediately but leaves an $80,000 repayment obligation, plus applicable interest and charges.
Mistake to avoid: Describing borrowed cash as income that removes the need for owner funding.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
52. Loan Interest and Principal Reduction
A loan payment can include both interest and principal. Under a stated monthly-interest convention, interest for the period is the opening principal multiplied by the annual rate divided by twelve. The remainder of the payment reduces principal. Actual loan documents may use different conventions, fees, or payment structures.
Worked example: On $50,000 at 6% annual interest using monthly calculation, first-month interest is $250. A $1,000 payment reduces principal by $750, leaving $49,250.
Mistake to avoid: Treating the entire loan payment as a reduction of principal.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
Risk, Maintenance, and Physical Management
53. Assigning Maintenance Responsibility
Maintenance responsibility depends on ownership boundaries and the governing allocation of duties, which may differ. Separate the component’s location, ownership, cause of damage, and assigned repair responsibility. Build a responsibility record from the documents before promising payment; proximity to a unit or use by one resident does not settle the question.
Worked example: Documents assign exterior wall repairs to the association and interior finishes to owners. A water incident affecting both requires separate work assignments rather than one blanket allocation.
Mistake to avoid: Assigning every repair to whoever uses the affected area.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
54. Preventive and Reactive Maintenance
Preventive maintenance is scheduled to reduce deterioration or failure; reactive maintenance responds after a problem appears. Choose intervals using component condition, manufacturer guidance, service requirements, and qualified recommendations. Record findings so recurring defects can inform replacement planning rather than repeatedly treating the same symptom as an isolated event.
Worked example: Regular drain inspections identify accumulated debris before overflow. Repeated damage despite cleaning prompts a qualified assessment of the drainage system rather than simply more frequent cleanup.
Mistake to avoid: Assuming a preventive schedule remains suitable regardless of observed condition.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
55. Prioritizing Work by Risk and Consequence
Work priority depends on potential harm, urgency, affected services, and the consequence of delay. A cosmetic defect and a suspected safety defect require different responses even when both are inexpensive to inspect. For possible hazards, use qualified personnel and appropriate access controls rather than asking untrained staff to diagnose or repair them.
Worked example: A loose handrail beside an active stairway takes priority over faded lobby paint. The manager arranges appropriate access control and qualified assessment before cosmetic work.
Mistake to avoid: Prioritizing requests solely by arrival date or repair price.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
56. Symptoms and Root Causes
A visible symptom does not establish its cause. Staining, cracking, or unusual consumption can have several explanations. Record location, timing, recurrence, and related observations, then obtain appropriate investigation. Repairing the appearance before resolving the cause can waste funds and conceal evidence needed for an accurate assessment.
Worked example: A ceiling stain returns after repainting. The manager documents its connection to rain and arranges investigation of potential water entry before authorizing another cosmetic repair.
Mistake to avoid: Treating a fresh finish as proof that the underlying defect has been corrected.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
57. Project Sequencing and Lifecycle Cost
A project should connect condition assessment, scope, authorization, procurement, installation, acceptance, and future maintenance. Consider lifecycle cost alongside initial price: service needs, useful life, and operating costs can change the economic comparison. Sequence dependent work so a newly completed improvement is not unnecessarily disturbed by a foreseeable related project.
Worked example: A walkway needs underground drainage work and resurfacing. The association completes and verifies the drainage work first, avoiding removal of freshly installed paving.
Mistake to avoid: Selecting or scheduling improvements without checking related system needs.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
58. Avoidance, Reduction, Retention, and Transfer
Risk can be avoided by stopping an activity, reduced through controls, retained through accepting its financial consequences, or transferred in part through insurance or contracts. These approaches can be combined. Transfer does not remove the underlying hazard, and contractual language should not be assumed to eliminate every possible exposure.
Worked example: For a community event, the association limits activities, checks vendor requirements, and reviews applicable insurance. Each measure addresses a different part of the remaining risk.
Mistake to avoid: Assuming insurance makes operational precautions unnecessary.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
59. Insurance Limits, Deductibles, and Exclusions
Insurance evaluation separates the covered cause of loss, insured property or liability, policy limit, deductible, and exclusions. A large limit does not guarantee coverage for a particular incident. Read the applicable policy terms and obtain clarification where needed before forecasting recoveries or telling owners that a loss will be fully reimbursed.
Worked example: Assume a $6,000 loss is fully covered, below the limit, and subject only to a $1,000 deductible. The insurer’s payment is $5,000, leaving $1,000 to fund separately.
Mistake to avoid: Subtracting a deductible before determining whether the loss is covered.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
60. Fair Housing Requests and Individual Review
A disability-related request may concern an accommodation to a rule or procedure, or a physical modification to property. Distinguish the request’s purpose from an ordinary preference and evaluate it under applicable fair housing requirements. A uniform rule does not eliminate the need to consider a legally required exception, and sensitive information requires appropriate protection.
Worked example: A resident requests a disability-related exception to a parking policy. The manager routes it through the appropriate individual review rather than rejecting it solely because the policy applies generally.
Mistake to avoid: Assuming identical treatment always satisfies fair housing obligations.
Source: PSI Georgia Real Estate/CAM current candidate bulletin
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