BOARD BULLETIN

TREASURY REVIEW

 

Dear Members,

 

The MASCUSA Board of Directors would like to thank Colleen Storms and the Treasury Review Committee for their time and hard work spent on the review of our treasury.  Please see their report below:

 

January 31, 2015

 

MASCUSA Board

Via Email

 

Re:  Follow-up on Financial Committee Review and Recommendations

 

Dear MASCUSA Board:

 

Our Committee performed a member review of the books, financial reports, and financial processes of the MASCUSA Club for the January 1, 2013 through September 30, 2014 period of time.  The goals of the review were to determine if the reports for this period reasonably presented the financial activity and position of the Club, and whether adequate internal controls existed to provide reasonable protection for the assets of the Club. 

During this review we examined the following records:  Minutes of Board meetings, Treasury reports submitted to the Board, bank reconciliation documents, and examples of the Registry submissions and payments made to the Registrar.  Also, the online Quickbooks system was accessed and some reports were used.  As a result of our review, we made some recommendations for changes to enhance controls and help consistency in the reports for the Board.

 

Response to Previous Recommendations:

•          Recommendation 1:  The end of month cash reported with the financial reports should be the "book" cash amount from Quickbooks on the last day of the month, not the unreconciled bank statement balances.  It should include all cash received into the PayPal account as well as the bank accounts; these cash receipt transactions should be booked (in Quickbooks) in the month they are received in bank. A bank reconciliation form like we saw in use should continue to be supplied with the Board reports along with copies of the actual bank statements.

The Treasurer has made the recommended changes to the cash reconciliation that is part of the periodic reports.  The year-end 2014 report has been presented in this new format, which is very easy and quick to review.  The bank statements have been retained as part of the presentation. 

 

•          Recommendation 2:  The Board should review financial reports and approve receipt of them no less often than once a quarter (we noted that the minutes said submitting reports annually was under consideration; we do not feel this is often enough for good internal controls).

The Board has agreed and established a policy to review financial reports no less than once per quarter.

 

•          Recommendation 3:  Some changes should be made to the procedures in place for the Athens Bank account currently used by the Registrar/Trustee to pay AKC for registrations processed and some miscellaneous operating costs.  We recommend that if use of the account will continue for these purposes, it should function like a 'petty cash' fund or an 'imprest' fund.  A couple of guidelines for that use would include: 1) the amount in the account would only be enough to pay one month's typical expenses with a small reserve; 2)  The Registrar would turn in a request for reimbursement of the fund each month with receipts attached and a detail of all transactions; this could be Board approved.  Treasurer would then make a check to send to Registrar to deposit in that account equal to the reimbursement amount, and at the time the check is issued, Treasurer would book the expenses into the Quickbooks system herself, not the Registrar/Trustee of the account.

The Board discussed the Athens Bank account at its January 2015 meeting and has decided that, for now, the account serves the purpose of speeding up the AKC submissions.  They discussed having the Registrar send a listing of all checks written from the account monthly, and the Treasurer will issue a check from the regular bank account to reimburse the Athens Registrar fund.  This procedure was discussed, which would also require the Board set the amount to be held in the Athens Bank fund, but to the date of this subsequent report, the Board has not confirmed that this new procedure is in place as yet. 

 

2-23-15-Board update: The Board is acting on this recommendation and will be implementing a resolution in the next few weeks. 

 

•          Recommendation 4:  We discussed some challenges the Treasurer faces because of the way Quickbooks shows customer overpayments and refunds, and that those transactions create obstacles to easily reconciling the net income in the Profit and Loss to the cash change for the month.  We recommend that some analysis be performed to figure out how best to reconcile the Profit and Loss to cash in a simple enough way it is easily reviewable and something future Treasurers could follow.  The Cash Flow report in Quickbooks is one possible report to fulfill this goal.

When the Treasurer changed to using the book cash balance for the reconciliation prepared with each monthly profit and loss statement, this problem was resolved.

 

•          Recommendation 5:  We are again recommending the Board set an annual budget for discretionary expenses, like the national show and support for subsidiary club events and other priorities.  Having a budget, even if it has to be amended during the year, could expedite the reimbursement of decentralized members incurring the expenses as they work on these events.  This is likely to be more important as the club actively promotes our breed nationally.

The Board has not yet adopted a policy that would require an annual budget be approved with related changes to the types of reports they would receive.

 

Board Update 2-23-15:  The Board approved a Nationals budget in September 2014 and the Treasurer established that budget in the club's Quickbooks accounting system.  This allows the Treasurer to pay for items contained within that budget in an efficient, timely manner without requiring additional board approval.  All income and expenses for Nationals will be posted to that account and the budget will be brought back to the board for adjustment if needed.  Additionally, a club budget will be worked on and implemented in the future.

 

Again, in the areas we reviewed, Club treasury operations complied with applicable Board policies and rules and regulations applicable to non-profit entities, and provided adequate safeguarding of the Club's resources.  The previous Treasurer Traci Phillips, and the current Treasurer Patricia Davis, have certainly been diligent in the execution of their duties.  The report of profit and loss, and tracking of cash in the Club's accounts is being prepared with adequate controls and transparency.  These processes should be memorialized in a written procedure and used to train future treasurers.  We appreciate again the professionalism and effort of these officers.

 

Sincerely,

Colleen G. Storms

For the: Member Treasury Review Committee