Editor’s Note: Previous posts on the topic of TGWAR may be found in the Article Index of the HOA Detective™ website: https://hoadetective.com/article-index/
HOA Detective™ | May 19, 2026: In the world of HOA governance – in particular, financial reporting – transparency is often treated as optional. Until somebody starts asking difficult questions. Then the game of TGWAR begins – “The Game Without Any Rules.”
TGWAR It is a surprisingly common institutional dance in which boards of directors (BOD) and management companies (Mancos) change or interpret the rules of disclosure to suit their needs, manipulating the presentation of data to make it look as if everything is under control.
Real-Life Game of TGWAR: A recent CIDA REPORT™ examination involving the sale of a condominium unit in a major downtown Portland high-rise provides a near textbook example of how the TGWAR process works in practice. The Association name is omitted intentionally, but the underlying facts are real, the documents are real, and the issues described below were delivered to a prospective buyer during the course of an actual condominium transaction in early 2026.
The property itself occupies an important niche in Portland’s downtown market. Units have routinely traded in the mid-$300,000 range, making the development one of the most affordable high-rise condominium environments in the urban core. On the surface, this affordability appears attractive, but as the Detective has repeatedly observed, the purchase price of an aging condominium often represents only the entry fee into the long-term ownership equation.
TGWAR Round 1: The first red flag involved the Association’s 2024 audited financial statement. The document was delivered to the buyer with the word “DRAFT” stamped diagonally across every page of the report. The issue is not merely cosmetic. According to the Association bylaws, an audit is required annually. Yet 18 months after the 2024 year-end, the version circulating during an active resale transaction still appeared unfinished, not approved, or otherwise not formally finalized.
This is classic TGWAR™ behavior – regardless of what the bylaws say, a draft version of the most important document in the disclosure milieu is all this buyer got.
If challenged, management can always retreat into procedural ambiguity:
- The audit was completed,
- No irregularities were noted by the auditor,
- So, what’s the big deal if it has not been finalized?
- After all, the final version is “in process,” – management-speak for “when we get around to it.”
From a buyer’s standpoint, the distinction matters. A draft audit is not the same thing as a finalized audit formally accepted by the governing board. The existence of a draft stamp immediately raises difficult questions:
- Was the audit officially issued by the Association?
- Was it accepted by the Board?
- Were unresolved issues still under discussion?
- Why was a draft version circulating in a live resale package?
Buried within the auditor’s report was an even more revealing disclosure. The CPA expressly noted that management had omitted supplementary information regarding future major repairs and replacements ordinarily expected to accompany condominium reserve disclosures.
That sentence deserves careful attention.
The auditor was effectively informing the reader that one of the most important components of condominium financial reporting – projected future repair obligations – was excluded from the audited presentation.
Again, this is a classic example of TGWAR™ – change the rules of the audit game when it benefits the Association’s BOD to do so. By disclosing the omission, the obedient auditor can issue the report with a “clean opinion,” which is auditor-speak for “everything is fine.”
Technically speaking, the omission is disclosed. Procedurally speaking, the audit may still satisfy minimum audit standards, but economically, the effect is obvious:
The buyer is denied one of the most important disclosure tools for understanding future financial exposure if said buyer becomes a vested stakeholder in the Association.
If such a maneuver were to be attempted in the realm of auditing a publicly traded corporation, the hue and cry would be heard through the halls of the SEC.
This becomes especially important in older urban high-rise environments where:
- Major building systems are aging simultaneously,
- Deferred maintenance is compounding the financial impact of ownership,
- Special assessments may be structurally embedded into the ownership model.
In this case, the audit disclosed ongoing serial special assessments, a substantial loan balance, deferred settlement funds tied to work quality issues, and a window replacement obligation looming in the reserve study’s five-year window of expenditures.
Yet the reserve disclosure ordinarily included in the audit, for the purpose of contextualizing the financial exposure associated with near-term reserve spending, was omitted from the audited package.
TGWAR Round 2: TGWAR™ is not always about hiding information outright. Sometimes it involves ensuring the most alarming information remains fragmented across multiple documents, forcing the buyer to reconstruct the true picture manually.
The reserve study delivered during this transaction introduced another fascinating example. The 2026 reserve study prepared by a nationally recognized reserve study provider included extensive (200-plus pages) asset inventories, projected repair schedules, and funding models. Yet one of the most widely recognized reserve study metrics in the industry – Percent Funded – was conspicuously absent from the principal 30-year funding projection.
That omission is highly significant. Within the reserve study profession, the Percent Funded metric has long functioned as one of the clearest shorthand indicators of reserve fund strength and deferred maintenance risk.
While imperfect, it provides owners and buyers with a quick way to gauge whether an association is statistically weak, fair, good, or strong relative to anticipated reserve obligations.
Ironically, the reserve study itself included a discussion explaining the importance of Percent Funded ranges and their relationship to special assessment risk. The report even included a color-coded chart describing how lower Percent Funded levels correlate with elevated risk.
But the actual longitudinal Percent Funded column – the metric many analysts look for first in a funding plan – did not appear in the principal 30-year projection.
The Art of TGWAR at its Finest: The omission may be technically permissible. The reserve study may or may not satisfy statutory requirements, but hey, who’s checking – there are no reserve study police.
The reserve study consultant is not expected to validate the methodology. The client is happy as the inconvenient truth of underfunded reserves is swept under the rug for another year, but the practical effect is unmistakable:
One of the clearest, most widely accepted tools for interpreting reserve fund health is removed from immediate view.
And that matters enormously in a building where future window replacement costs alone are projected in the millions, serial assessments have already become normalized, and affordability depends heavily on minimizing visible long-term carrying costs at the point of sale.
This is where the psychology becomes especially important. In many aging condominium projects, affordability itself becomes politically dependent on suppressing the visibility of future liabilities. A unit priced at $350,000 appears affordable. A unit priced at $350,000 plus-
- Recurring special assessments,
- Elevated reserve obligations,
- Major deferred infrastructure costs,
- Aging building enclosure components in a high-rise urban environment,
- Long-term capital instability is a very different economic proposition.
TGWAR™ emerges because fully transparent financial disclosure can threaten marketability, depress resale pricing, destabilize owner sentiment, and create governance backlash.
Boards fear angry owners and declining values. Management companies fear client loss and transactional disruption. The institutional instinct, therefore, becomes predictable:
Disclose enough to remain technically compliant. Avoid enough detail to prevent panic. Keep the Imperfect Machine moving along, kick the can further down the road.
The larger problem is that the HOA disclosure framework is not intended to ensure financial transparency. It is more of an exercise in controlled ambiguity.
Buyers receive the reserve study, the audit, the meeting minutes, and the budgets, but the burden of synthesizing risk is shifted almost entirely onto the consumer.
Most consumers are not reserve analysts, forensic accountants, or construction consultants. They are simply trying to buy a home, and in this case:
You’re Buying More than a Home!
