The POA operating budget is a projection of the money needed by the association to cover its operating expenses and provide adequate reserves for repair and replacement of the elements of the property the POA maintains. Each year the POA must adopt an operating budget. This typically means that it revises its current budget by taking into account changes in its financial position and cost structure. The governing documents provide that the budget is adopted by board, rather than a vote of the owners. The budget is distributed as part of its annual report.
The POA's financial report is a way to provide the members with a proper end of the year financial report. This is usually presented at the POA's annual meeting.