Learning Through Research

Fiscal Oversight and Policy Statement

Fiscal Oversight and Policy Statement

August 17, 2000

 
General: 

CUR's finances are maintained on an accrual basis in a double-entry electronic bookkeeping system. The general ledger is maintained on a daily basis by in-house staff with assistance from a professional bookkeeper as needed (currently about 4 days/month). The bookkeeper prepares the payroll and taxes, does the bank reconciliation, and makes quarterly accrual adjustments in consultation with the NEO. A system of checks and balances is in place regarding check writing/signing and bank deposits.

Check Signing Authority: The Office Manager and NEO have check-signing authority within the office. One person authorizes each expenditure and the other signs the check. No payment can be made without a verified pay document.. Payroll checks may be issued monthly or bi-monthly, at the discretion of the NEO.

Major Payment Authorization: For checks over $10,000, written authorizations from both the Treasurer and President are required after written notice to both explaining the need. The same limits apply to credit card purchases. All credit card purchases must be approved by the NEO and original pay documents must be on file with the credit card invoices.

The Treasurer has signature authority to be exercised only in emergency situations.


Funds Management:

CUR funds are divided into three groups:

  1. National Office checking accounts (managed by the NEO and designates; oversight by the Treasurer)
     
  2. Short term investments -- for management of cash flow needs
    The Treasurer shall manage assets maintained for cash flow purposes in money market funds, bond funds, and related instruments that yield competitive rates of return while providing liquidity and safety. 
    Implementation: These funds will include excess cash in the current fiscal year, deferred grant income, and funds unspent from previous years. Cash from previous years may be permanently transferred to operations only on approval of the Executive Committee after review and assessment by the Finance Committee. 
     
  3. Long term investments (invested by a money manager or management team; Treasurer and others designated by him in consultation with the President receive periodic reports, meet with the manager(s) and have oversight responsibility); divided into the following designated funds:
     
    • Permanently restricted endowment funds
      All funds donated to the Andreen Undergraduate Research Fund (income -- spending formula expectation is 5% of a three-year moving average -- restricted to research fellowship awards under procedures as designated by the Executive Committee) 
       
    • Voluntarily restricted long-term investments (sometimes termed in previous years and under earlier accounting rules as quasi-endowment or funds functioning as endowment - principal, income, and appreciation unrestricted). Includes $200,000 from the match of the Pew Charitable Trusts grant completed in 1994.
       
    Endowment contributions shall be transferred from operating (checking) accounts to the appropriate long term investment accounts on at least a monthly basis.

When the audited report from a given fiscal year has been received, or at other times deemed prudent by the Treasurer and NEO, the Finance Committee will review the amounts and variations in the short term investments account and may advise the Executive Board to direct the transfer of funds to the long term investments.

 
Budgets: 

The National Executive Officer will consult with the Finance Committee and the Executive Board in January and February to develop a set of principles and assumptions for the following year's budget and to identify programs with fiscal implications. The National Executive Officer, working in consultation with the Treasurer, will prepare annual budgets in March-April for presentation to the Finance Committee and Presidents for their review and recommendation. Budgets, suitably revised, will be passed from the Finance Committee with its recommendation to the Executive Board for approval.
 
Annual summaries will be prepared by the NEO with assistance from the accountant and auditor, comparing current year (Y) budget and actual with previous year (Y-1) and the budget for the upcoming year (Y+1).


Reports: 

The CUR National Office will prepare quarterly reports for distribution to the Finance Committee (which includes the Treasurer) and Presidents. These reports will include a balance statement, general ledger (available at the National Office), and a breakdown of income and expense by cost center. Income and expense will be compared with the current year's budget predictions. Quarterly reports will also include a monthly chart of individual and institutional memberships for the current fiscal year in comparison with previous years.
 
Monthly accounting (general ledger; trial balances; etc.) will be maintained within the CUR office using standard accounting practices. Reports will be generated by the Bookkeeper and Office Manager and reviewed by the NEO.
 
An annual audit will be performed by an outside CPA firm with the report to include a management letter. The independent auditing firm will be engaged by the Executive Board on recommendation of the NEO and Treasurer.
 
The NEO will provide explanatory notes to accompany the financial reports.
 
Cost Centers: Each major activity forms a cost center, e.g. member services, meetings, publications, and each externally-funded project. Meetings and publications are broken down into their constituent parts, e.g., April Dialogue; CUR Institute X in year Y.


Fiscal Oversight: 

The NEO is authorized to manage CUR income and expenses limited in any given year to a total expenditure not to exceed the total expense line item in the approved budget.
 
If a budget overrun in an expense category is anticipated, the NEO will inform the Treasurer and report whether this may be offset by reduced expenditure in another line item. Total approved expenses may not be exceeded without prior approval by the Executive Board. If a revenue shortfall is anticipated, the NEO will propose to the Treasurer means of resolving the situation by reducing expenditures, generating new revenue, or drawing on the reserve fund. They jointly will submit plans to the Finance Committee for its review and recommendation to the Executive Board for approval. These Committees may grant the Treasurer and NEO the authority to make decisions on changes in operations. However, if programs and policies of the organization are to be affected by budget cuts, the Executive Board will make the final decisions.


Fees and Program Costs: 

In the context of the current budget and in consultation with the volunteer organizers and the CUR Treasurer and President, the NEO sets the fees (and fee waivers) and budgets for individual CUR operations including Directories, Quarterly, Institutes, Dialogue, and National Conferences. These fees and budgets should be consistent with broad principles of fee structure, member and volume discounts, and net revenue goals established by past precedent or as revised after consideration by the Finance Committee and approval by the Executive Board. Similarly, the NEO sets fees for services and handling charges, except for those that are provided to members as part of their membership benefits. Some programs may be designated by the Executive Board as cost-neutral and should have appropriate fees set each year; other programs will be designated as revenue producing and have their fees set accordingly; while yet other programs will be designated as membership services or as general operations and programs which are supported by the membership dues and other revenues.
 
The dues for Individual and Institutional Memberships are set by the Executive Board. Changes in dues for individual and institutional members for any given year must be approved at a June meeting one full year prior to those dues taking effect. Dues and benefits for other membership categories may be created by the Executive Board and revised at any time for future years. Membership benefits are reviewed annually by the NEO and the Membership Committee is consulted as needed. Changes in membership benefits require review and approval of the Executive Board.
 
 
Drafted by K. Elaine Hoagland and Neal Abraham, June 1998
Reviewed and Edited by the Finance Committee, June 24, 1998
Approved and adopted by the Executive Committee, June 24, 1998
Reviewed and Revised by the Finance Committee, August 17, 2000