Co-ownership Accounting in France: the Five Annexes of the 2005 Decree, the Separate Account and the Works Fund

You have just taken over as the volunteer manager (syndic bénévole) of your building, or your co-owners' council is considering switching to a cooperative manager to reduce fees. The accounting of a French owners' association (syndicat des copropriétaires) has nothing in common with company accounting. It is governed by a dedicated text, Decree no. 2005-240 of 14 March 2005, supplemented by an order of the same date, which require double-entry bookkeeping, kept by financial year, with a separate account for each co-owner and five statutory annexes approved at the general meeting. This practical guide covers these obligations one by one: the logic of double-entry bookkeeping, the five annexes, the separate bank account, the works fund, and the point at which delegating becomes the right decision.

The co-ownership regime rests on Law no. 65-557 of 10 July 1965 and its implementing Decree no. 67-223 of 17 March 1967. The accounting rules come from Decree no. 2005-240 of 14 March 2005. This text imposes three structuring principles.

Double-entry bookkeeping. Every transaction is recorded twice, as a debit and a credit. This is not an accountant's refinement: it is what makes it possible to know, at any time, not only what has been spent but also who owes what. A simple cash book of receipts and payments is not enough, because it shows neither supplier debts, nor co-owners' unpaid charges, nor provisions called but not yet used.

Accounts kept by financial year. Charges are attached to the year they relate to, not to the date they are paid. The cycle is always the same: a provisional budget voted at the general meeting, quarterly charge calls, then a year-end reconciliation of actual charges, with each share allocated by ownership fractions (tantièmes).

A separate account for each co-owner. Every co-owner has their own account within the association's books. This is the condition for reconciling charges correctly and documenting unpaid amounts.

One essential point: the sums collected never belong to the manager. They are third-party funds, the property of the association. Disbursements (insurance premiums, supplier invoices, third-party fees) are re-billed to co-owners without any margin.

The classic trap: confusing cash and allocated charges#

The most frequent mistake in the books we take over is not a posting error. It is reasoning in cash terms: "there is money left in the account, so all is well". Yet co-ownership accounting reasons in allocated charges and called provisions. A positive bank balance can hide significant unpaid charges or an under-provisioned works fund. This is precisely what the annexes must make readable.

The order of 14 March 2005 sets out the five accounting documents that every association must produce for the general meeting approving the accounts. They form a whole: each sheds light on a different facet of the situation.

Annex 1: the financial statement after allocation#

This is the snapshot of the association at closing: its cash and asset position once the year's charges have been allocated among the co-owners. It is the functional equivalent of a balance sheet, adapted to the logic of co-ownership.

Annex 2: the general management account and the provisional budget#

This document puts actual figures against voted ones: the charges actually incurred over the closed year, compared with the approved provisional budget, plus the budget proposed for the following year. It is the natural basis for the debate at the general meeting.

Annex 3: the management account for current operations#

It breaks down current charges item by item. This is the annex that answers co-owners' concrete questions: how much maintenance, insurance or the energy of common areas actually cost.

Annex 4: the statement of article 14-2 works and exceptional operations#

Everything outside the current budget appears here: works financed by the article 14-2 works fund and exceptional operations. This annex is gaining importance as renovation obligations ramp up (we come back to this below).

Annex 5: the statement of debts and receivables#

In practice, this is the annex that reveals the real health of the co-ownership: co-owners' unpaid charges on one side, supplier debts on the other. It is the most sensitive subject at the general meeting, and the main cause of cash-flow tension. Our advice: do not discover it when preparing the meeting. Unpaid charges are handled continuously, through reminders and payment plans, not once a year.

These five annexes are submitted for approval at the general meeting by the article 24 majority. Accounts that are readable, mutually consistent and compliant with the chart of accounts sharply reduce the risk of dispute at the vote.

The association must hold a separate bank account opened in its own name. The obligation appears in article 18 of the 1965 law and was reinforced by the ALUR law of 27 March 2014. The exemption that remained for some small co-ownerships was definitively abolished by the 2019 co-ownership ordinance, applicable from 31 December 2020. In other words: today, no co-ownership escapes it, whatever its size.

Two consequences deserve emphasis, because they are serious and often ignored:

• if no separate account is opened, the manager's mandate is null and void as of right at the end of a three-month period following appointment;
• only traditional credit institutions may hold this account: neobanks are excluded.

Check this point as soon as the mandate begins, even before the first general meeting is convened: account title in the association's name, eligible institution, and, in parallel, the opening of the interest-bearing account dedicated to the works fund.

The works fund falls under article 14-2 of the 1965 law. It is a mandatory contribution, paid into a separate interest-bearing account, intended to finance the building's future works. In accounting terms, it must remain isolated: it is not the same as the provisional budget, nor as cash advances, and its tracking appears distinctly in the annexes, notably annex 4.

This mechanism now works alongside two obligations that are changing co-ownership budgets:

• the multi-year works plan (PPPT), required since 2025 for all residential co-ownerships over 15 years old; once the plan is adopted, the annual contribution to the works fund may be no lower than 2.5% of the works planned in the adopted plan, nor 5% of the provisional budget;
• the collective energy performance diagnosis (DPE collectif), mandatory since 1 January 2026 for co-ownerships of up to 50 lots whose building permit was filed before 2013 (Climate and Resilience Act, article L126-31 of the French construction code), the final step in a timetable that started with co-ownerships of more than 200 lots in 2024, then those of 50 to 200 lots in 2025.

For the volunteer manager, the consequence is direct: these decisions are voted, budgeted, and must be correctly reflected in the accounts. A works fund under-provisioned against the adopted plan, or absorbed into current cash, will sooner or later show in the annexes, and will be paid for through exceptional charge calls that co-owners resent.

The law does not require a chartered accountant to keep a co-ownership's accounts. Many small associations manage on their own, and that is legitimate as long as the accounts remain simple and someone on the council masters double-entry bookkeeping.

In practice, certain signals should make you consider delegating:

• no one on the council knows how to produce the five annexes, or preparing the general meeting has become an annual ordeal;
• unpaid charges are piling up and annex 5 is no longer reliable;
• the co-ownership adopts a multi-year works plan and tracking the works fund becomes more complex;
• you are leaving a professional manager for a cooperative one and an existing set of accounts must be taken over without disruption;
• the separate account has never been checked (title, institution, distinct works fund).

The right division of roles is then simple: the volunteer or cooperative manager keeps what they do well, closeness, decisions, the relationship with co-owners; a chartered accountant for co-ownership property managers takes over double-entry bookkeeping, the production of the five annexes, the securing of the separate account and the works fund, registration with the national co-ownership register kept by ANAH and the clear presentation of the accounts at the general meeting. The cost of this delegation is scoped to the size of the co-ownership and the state of the accounts taken over; it is weighed against the fees saved and the risk of dispute avoided.

Co-ownership accounting is a regime of its own: double entry, accounts kept by financial year, per-co-owner tracking, five annexes approved at the general meeting, a separate bank account on pain of nullity of the mandate, and a works fund isolated in an interest-bearing account. The multi-year works plan and the collective energy diagnosis have added, since 2025 and 2026, a layer of decisions to budget and to reflect in the accounts. A volunteer manager can perfectly well hold the mandate; there is no reason to carry the accounting technique alone.