What does "Dr" mean on a strata report?
"Dr" is an accounting abbreviation for debit. Next to a fund balance it means the balance is negative — the owners corporation has spent more than it holds.
It is two letters, it is easy to skim past, and it inverts the meaning of the number beside it. A balance of $3,241.88 sounds like a fund with money in it. A balance of $3,241.88 Dr is a fund that is overdrawn by that amount.
“Approximate cash at bank balance $3,241.88 Dr”
You will also see "Cr" for credit, which for a fund balance means what you would expect: money in it. Some reports use brackets instead — "($3,241.88)" means the same thing as "$3,241.88 Dr". Others write "in deficit" in the notes while the table still says Dr.
If a fund balance carries Dr, brackets, or a minus sign, read the surrounding notes before anything else in the report. An overdrawn administrative fund is one of the strongest signals that a special levy is coming.
Why it matters to you specifically: the administrative fund pays the scheme's day-to-day bills. A scheme that cannot meet them from levies has to get the money somewhere — usually by raising levies, striking a special levy, or borrowing from the capital works fund. All three land on whoever owns the lot when the bill falls due.
There is a second place Dr turns up, and it means something different. Against an individual LOT, a Dr balance in the levy ledger means that owner is in arrears — they owe the scheme money. That is a fact about the seller rather than about the building, and your conveyancer will normally require it cleared at settlement. Do not read one as the other: an overdrawn fund is the scheme's problem and becomes yours; an owner in arrears is the seller's problem and usually stays theirs.
One more habit worth forming. Report tables are often generated straight out of the strata manager's accounting package, and the abbreviations come with it unchanged — Dr, Cr, sometimes "b/f" for brought forward or "YTD" for year to date. The narrative pages of the report are written for you. The tables are not, and the tables are where the money is.
- Dr — debit. On a fund balance: overdrawn. On a lot ledger: arrears.
- Cr — credit. On a fund balance: money in it. On a lot ledger: paid ahead.
- Figures in brackets, or with a minus sign, mean the same as Dr.
What to ask
Copy these into an email. The people below can answer them; we can’t.
- To your strata manager: the report shows the administrative fund as overdrawn — what is the balance today, and what is the plan to bring it back into surplus?
- To your strata manager: has a levy increase or special levy been proposed or discussed at any meeting not yet minuted?
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Related
General information about what these documents say — not legal, building or financial advice, and not a substitute for your conveyancer, solicitor or licensed inspector. Law and practice change, schemes differ, and your contract may say something different from the general position described here.