Why It Matters

Without a proper forecast, owners get hit with surprise special levies.

Every strata or body corporate building has major capital items that wear out: roofs, lifts, paint, common-area carpet, fire systems, hot water, swimming pool plant. None of these are cheap. Without a forward-looking plan, the contributions owners make to the sinking fund are guesswork, the fund runs short when works are needed, and the body corporate has to issue a special levy.

A QS-prepared sinking fund forecast prevents this. It identifies every capital item, projects its useful life and replacement cost, and calculates the steady annual contribution required to fund the works as they fall due. The forecast is then adopted at the AGM and built into the next year's levies.

MCG has prepared sinking fund forecasts for residential, commercial and mixed-use strata schemes ranging from small townhouse complexes through to multi-tower developments with shared amenities, basements, lifts, and substantial common property.

Quick Reference
Admin fund vs sinking fund

Strata buildings keep two legally separate funds:

Admin Fund Day-to-day recurring costs (insurance, cleaning, audit)
Sinking Fund Major capital expenditure (roof, lifts, paint, plant)

A sinking fund forecast covers the second pot only.

Legal Requirements

State-by-state strata legislation

Every Australian state and territory requires some form of forward capital works planning for strata and body corporate buildings. The terminology and detail varies, but the underlying need is the same.

Jurisdiction Legislation Required document
NSWStrata Schemes Management Act 201510-year capital works fund plan, reviewed every 5 years
VICOwners Corporations Act 2006Maintenance plan for prescribed owners corporations (3-tier and above)
QLDBody Corporate & Community Management Act 1997Sinking fund forecast (varies by regulation module)
WAStrata Titles Act 198510-year plan for schemes with 10 or more lots, or budget over threshold
SAStrata Titles Act 1988 / Community Titles Act 1996Sinking fund maintained, contributions set annually
TASStrata Titles Act 1998Maintenance plan and sinking fund
ACTUnit Titles (Management) Act 2011Sinking fund maintained for capital expenditure
NTUnit Title Schemes Act 2009Sinking fund and capital works planning

Always verify the current requirements with your strata manager or owners corporation manager. Legislation is updated periodically; this table reflects the position as at April 2026.

What's Included

Inside an MCG sinking fund forecast

Six components every forecast contains, designed for straight AGM presentation and adoption.

Site inspection
Physical inspection by a registered QS who identifies and condition-rates every significant common-property capital item.
Asset register
Complete schedule of every capital item, its location, condition, expected useful life, and replacement cost (in current dollars).
10-year cash flow
Year-by-year projected expenditure across all capital items, showing peaks and troughs and the annual contribution required to smooth them.
Contribution recommendation
Recommended annual sinking fund contribution per lot (or per unit entitlement) to maintain a sustainable fund balance.
State-compliant format
Forecast structured to meet your jurisdiction's specific strata legislation requirements (NSW SSMA, VIC OCA, QLD BCCMA, etc.).
AGM-ready report
Narrative report plus tabular schedules, formatted for direct presentation to the AGM and inclusion in body corporate records.
How It Works

From enquiry to delivered forecast in 4 steps

A standard MCG sinking fund forecast engagement, end to end.

Send building details
Strata plan number, building age, number of lots, common-property components. Strata manager typically coordinates the engagement.
QS site inspection
A registered QS attends the building, photographs and condition-rates every common-property capital item, notes age and remaining life.
Forecast prepared
10-year cash flow built from the asset register, with annual contribution calculated and report drafted to your state's compliance requirements.
Adopt at AGM
Forecast presented at the next AGM. Once adopted, levies are set for the coming year and the plan is filed in body corporate records.
Mike Mortlock, Co-Founder and Managing Director of MCG Quantity Surveyors
Reviewed by

Mike Mortlock

Co-Founder and Managing Director, MCG Quantity Surveyors

Mike Mortlock is a registered tax agent and the co-founder of MCG Quantity Surveyors. He sits on the AIQS Advisory Board and the PIPA Board. MCG has prepared sinking fund forecasts for residential, commercial and mixed-use strata schemes ranging from small townhouse complexes through to multi-tower developments.

Registered Tax Agent (TPB) AIQS Advisory Board PIPA Board
Last reviewed: 26 April 2026 · Specialism: sinking fund forecasts, capital works planning, strata QS reports
FAQ

Common questions on sinking fund forecasts

The questions strata managers, body corporate committees and owners ask MCG most often.

A sinking fund forecast (also called a capital works plan) is a 10-year projection of major capital expenditure for a strata or body corporate building. It identifies every significant building component (roof, lifts, paint, common-area carpet, fire systems, hot water, swimming pool plant), estimates when each will need replacement or major repair, projects the cost in today's dollars, and calculates the annual contribution owners need to make so the funds are available when works are required.
Yes, in most Australian states for strata and body corporate buildings. NSW Strata Schemes Management Act 2015 requires a 10-year capital works fund plan. Victoria's Owners Corporations Act 2006 requires a maintenance plan for prescribed owners corporations. Queensland's Body Corporate and Community Management Act 1997 requires a sinking fund forecast (varies by regulation module). WA, SA, TAS, ACT and NT have similar requirements with state-specific terminology.
The admin fund (or administrative fund) covers day-to-day recurring expenses: insurance, water, garden maintenance, cleaning, audit fees, strata management. The sinking fund (or capital works fund) covers major non-recurring capital expenditure: roof replacement, lift overhauls, repainting, lift modernisation, fire system upgrades. The two are kept legally separate and contributions to each are calculated independently.
NSW SSMA requires the capital works fund plan to be reviewed at least every 5 years. Most strata managers and committees revisit the forecast every 3 to 5 years to reflect updated cost data, completed works, and changes to building components. A new forecast is also typically commissioned when major works are added (e.g. EV charging infrastructure, solar PV).
All shared common-property capital items with a useful life over 1 year. Typical items: roof and gutters, external paint, common-area carpet and flooring, lifts (cars, motors, controls), hot water systems, swimming pool plant, fire detection and suppression, intercom and access control, security cameras, common-area air conditioning, lighting, fencing, paving, signage, mailboxes. Lot-owned items (interior fit-out within individual units) are excluded.
Typically the strata committee or body corporate engages a quantity surveyor on behalf of all owners. The strata manager often coordinates the engagement. Costs are funded from the admin fund (or directly billed to owners). The forecast is then presented to the AGM for adoption and to confirm the next year's levies.
Standard turnaround is 3 to 4 weeks from site inspection to delivered forecast for most strata buildings. Larger developments (multi-tower, complex amenities, mixed-use) can take 6 to 8 weeks. The forecast is delivered as a 10-year schedule plus narrative report, ready for AGM presentation.
Talk To An Expert

Need a sinking fund forecast for your building?

Talk to MCG on 1300 795 170 or have your strata manager get in touch. Compliant under all Australian state and territory strata legislation.

Request A Quote 1300 795 170
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