What does it mean?
Accounts payable are amounts the association owes for recorded vendor bills or similar obligations that have not yet been paid. They differ from a future budget estimate: a payable relates to an actual obligation recorded in the books. Approval and payment are separate steps in the workflow.
Related names and search phrases: AP, payables. Usage can vary.
ILLUSTRATIVE COMMUNITY EXAMPLE
What it can look like
A contractor’s accepted invoice is entered before the payment is issued. The board can see the unpaid obligation even though the bank account has not yet changed.
Why your board should care
Tracking unpaid bills helps prevent duplicate payments, forgotten obligations, and an overstated view of available resources.
Keep the distinction clear
Match the bill to the authorized work and payment controls; entry into a system is not approval.
Sources & scope
Sources consulted . These references support the explanation’s background; the examples and board questions are original editorial illustrations.
- SEC: Beginners’ Guide to Financial Statements ↗
General financial statement concepts. Association fund presentation can differ from business examples.
- IRS Publication 583: Keeping Records ↗
December 2024 publication. General bookkeeping and reconciliation background, not association-specific legal requirements.
General educational explanations for HOA, POA, and condominium boards. Terms and procedures vary by state and governing documents. Examples are fictional. For a specific legal, tax, accounting, or property decision, consult a qualified adviser.
Prepared with AI assistance and source checking. Not represented as an attorney or accountant review.