SOLVED- ELABORATED-CMCA Practice Test Questions

Page 1 of 41

1 SOLVED- ELABORATED-CMCA Practice Test Questions

2022 COMPLETE

Which of the following is a common management control for ensuring maintenance work is performed in a timely manner?

• A purchase order system
• An equipment warranties
• A work order/response form
• A contractor's invoice - ANSWER>>C. A work order/response form - A, B, and D speak to

elements OTHER than a control to ensure maintenance work is completed.The primary management control tool for identifying whether the association needs to

maintain a particular property element is:

• Physical inspections
• Association bylaws
• Maintenance responsibility chart
• Community asset inventory - ANSWER>>C. Maintenance responsibility chart along, with the

governing documents, defines parameters of association maintenance responsibility.

The other answers have no bearing on necessity of maintenance or maintenance responsibility. 1 / 4

Page 2 of 41

2 In what type of a contract would a waiver of lien by recommended?

• Repair of the HVAC system
• Re-roofing the buildings
• Repair of the pool pump
• Annual tree pruning - ANSWER>>B. Re-roofing the buildings - Large contracts involving

significant material purchase and/or use of sub-contractors commonly include lien waivers and should be recommended to the board.

A, C, and D typically do not include significant material purchases or the use of sub-contractors so a waiver of lien is not necessary.What does "Co-Insurance" obligate the Association to do?

• Pay the deductible
• Maintain certain limits of insurance
• Cover the depreciated value of all association buildings
• Provide insurance for homeowners - ANSWER>>B. Maintain certain limits of insurance - Co-

insurance seeks to the limits of insurance in place at the time of a loss and speaks to insurance obligation for the parties involved in the claim.

• / 4

Page 3 of 41

3 Co-insurance does not obligate the Association to pay a deductible. Provides no obligation to provide insurance for homeowners.When an association contracts out all of its services and has no employees, it is a best business

practice to:

• Negotiate contracts within the bidding process.
• Purchase employment practices liability insurance.
• Assume the contractors carry their own insurance coverage.
• Increase the coverage under the D&O insurance policy. - ANSWER>>A. Negotiate contracts

within the bidding process.

Incorrect Answers:

• Employment practices liability insurance is typically purchased by an association that has

employees to provide coverage against certain types of claims by those employees, and usually accompanies a workers compensation insurance policy.

• The association MUST NEVER assume that contractors carry their own insurance coverage

and should require all contractors to provide evidence of insurance.

• D&O insurance policies is designed to pay for wrongful acts that do not lead to property

damage (PD), bodily injury (BI), personal injury (PI), or advertising injury (AI); an example of a claim for coverage under D&O would be if a board of directors is accused of not uniformly 3 / 4

Page 4 of 41

4 enforcing rules or covenants. Therefore, it is unlikely that the services of independent contractors would lead to claims under D&O.If an owner fails to receive notice of a meeting, the association is not responsible if the owner:

• Did not notify association of their current address.
• Does not usually attend the meetings.
• Already signed the petition to call the meeting.
• Shares title with multiple owners. - ANSWER>>A. Did not notify association of their current

address. It is the owner's responsibility to provide current contact information to Management.

Incorrect:

• The duty to notify all owners of meetings belongs to the Board, which is often delegated to

Management.

• Signing a petition to hold a meeting is not legal notice of the meeting. The duty to notify all

owners of meetings belongs to the Board, which is often delegated to Management.

• The notice of meetings is sent to the "Owner of Record" at the last known address. In the

case of multiple owners sharing title to a unit, the owners of that unity have the duty to notify the Board/Management which one of the owners will receive notices, and provide current contact information.

• / 4