President's Word: Show Me the Money! - Decoding the Chapter Budget

By Carla Ulakovic
carla.ulakovic@gmail.com

For many, budgeting is often the elephant in a room. Though necessary function of business, it seems to be everyone’s least favorite topic of discussion.  I would like to take a moment to show our members the money, so to speak, and decode how the Chapter raises and uses funds. 

Reporting Responsibilities: Each Chapter president and board members are ultimately personally responsible for the finances of their chapter and have responsibility to  our Chapter members to share the chapter’s finances.  In an effort to maintain transparency and meet with guidelines from the State offices, our Chapter has been announcing our treasury totals at each chapter meeting. For those interested, the Chapter keeps all financial records up-to-date and available for review by chapter members.

At our monthly meetings of the board of directors, we review a detailed Treasurer's Report outlining all sources of income and expenses. The treasurer also compares actual figures against projections to ensure the budget stays in balance.

Quarterly, each Chapter president must provide reports to the state executive committee to demonstrate results, as well as the effective use of budgets and resources. At the end of each year a report is then due to state as a recap of all executed activities – the ultimately goal of which is to stay within the allotted yearly budget.

Planning and Preparation: At the beginning of each year, the incoming board of directors reviews the financial accomplishments and situations from the previous year. This review process helps set chapter goals for the year and allows the board evaluate financial resources needed to reach these goals in the new budget.

Additionally, our Chapter sends out a membership survey at the start of the year to ask members for input as to what types of programs and offerings each member would like to see in the year ahead. The board of directors then has the responsibility to set goals to achieve these programs while avoiding strain on chapter finances.

Auditing: Each Chapter must arrange for an annual audit and or review at the end of each fiscal year. Findings are then reported to the State office and the state files the necessary tax forms.  Financial Reviews of the chapter have been conducted internally by a three-member review committee.  If there is issue with the Chapter financing, state can recommend a professional audit at the Chapter’s expense.

Operating Expenses: The State bylaws require each Chapter to maintain at least six month’s operating expenses in a savings account, CD, etc.

So the money our chapter has in the savings account should almost be considered invisible money as it is to only be used in dire situations. This then means all events, programs and offerings for the year must be achieve through funds solely from the Chapter Checking account.

How do we raise money?

In these economic times, everyone is doing less with more. Though it may seem like the Chapter has a very healthy treasury, it is important Chapter funds are used.

1.      Membership - A healthy membership is critical to maintaining a healthy treasury.  A percentage of individuals membership dues are returned to the local chapters to help develop programs, etc. Renewing your membership by Oct 31 is critical because it allows for the chapter to plan for any dips in membership early on. An unexpected decline in membership, can negatively impact overall chapter finances. So, as a rule of thumb, chapters often try to grow their treasury to help offset any drop in future membership.
2.      Sponsorships – This year we reintroduced annual sponsorships and continue to offer sponsorship opportunities for our special events. Though we have a healthy treasury now, sponsorships are still crucial to the sustainability of our Chapter. They provide an opportunity to reach and educate our members and to cover the costs of producing programs as well as any dip in attendance or speakers fees.  Without sponsorships our Chapter would not be able to provide the frequency and caliber of programs that members have indicated they want through surveys.
3.      Chapter luncheons – Typically a nominal profit is made off our Chapter luncheons. Member participation in Chapter events from luncheons, to mixers and professional development seminars is crucial to maintaining a healthy treasury.

Where do we spend Chapter finances?

At the start of each year the board of directors determines where Chapter finances will be distributed. Sponsorship, member participation and member rebate help build our treasury so that we can offer programs such as:

·         Membership Scholarships
·         Scholarships to annual conferences,
·         Sponsorship of annual conference,
·         Chapter programs and special events
·         Maintains Chapter resources like our web site
·         Image Awards
·         Chapter Awards
·        Accreditation

This is a cycle that begins again with the passing of the torch from one leadership year to another.