BUILDING YOUR TOOL BUCKET

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BUILDING YOUR TOOL BUCKET

• 3 Basic Tools
• Finance
• Documentation
• Administration

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Financial Management

• Simplified
• Consistent
• Responsible

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Responsibilities of VP-Finance

• Keeping financial records
• Preparing financial statements reports
• Budgeting
• Managing the chapters financial assets
• Complying with government regulations

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Keeping Financial Records

• Income
• Expenses
• Banking
• Taxes, Insurance and Miscellaneous

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Financial Records - Income

• Income
• Checks, cash, automatic transfers
• Records of receipts
• Cash Receipts Journal a listing of receipts
• Copies of check stubs, invoices, etc.
• Notations (check number, from whom, for what)
• Deposit slips
• A file for Income, Deposits or Revenue

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Financial Records - Expenses

• Expenses
• Bills paid by check, cash, automatic transfer
• Records of bills paid
• General Journal a listing of bills paid
• Copies of invoices, bills
• Notations (check number, date paid)
• Cancelled checks if returned to you
• A file for Expenses Paid or Checks Written
• Bills to be paid
• A file for Bills to be Paid

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Financial Records - Banking

• Banking checking, savings, investments
• Statements
• Be sure to pick up bank fees, service charges,
  etc.
• Reconciliation
• Attach completed reconciliation to each statement
• A file for Banking
• Petty Cash
• Maintain a schedule another list
• Disbursements, replenishments

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Financial Records Taxes, Insurance
Miscellaneous

• Taxes
• Federal and state taxes - annual
• Taxpayer ID Non-profit / tax-exempt papers
• Incorporation
• Charter
• Insurance
• Policies
• A folder for Taxes, Insurance Misc.

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Preparing Financial Statements Reports

• Officially (per APICS manual)
• Balance Sheet
• Income and Expense Statement
• Cash Flow Statement
• Audits
• Note Are you on a cash or accrual accounting
  basis?
• Cash recognize bills and payments as paid and
  received
• Accrual recognize bills and payments when owed
  and due

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Chart of Accounts

• List of activities that have financial
  transactions
• Income
• Expense
• List of asset categories
• Bank and investment accounts
• Physical assets
• List of liability transaction types

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Balance Sheet

• Shows chapter Assets and Liabilities at a certain
  point in time (e.g., end of month)
• Assets (cash, inventory)
• MUST EQUAL
• Liabilities (commitments)
• PLUS
• Chapter Equity
• Not often used by chapters may be used by audit
  firm

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Income and Expense Statement

• Reports financial activity during a certain time
  period (month, quarter, etc.)
• Shows Surplus or Deficit for timeframe
• Subtracts expenses from revenue
• Report both current period and year-to-date

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Cash Flow Statement

• Also called Statement of Changes in Financial
  Position
• A quick check on assets of a chapter
• Review at least quarterly to avoid surprises
• Can be a forecast of future cash position

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Financial Statements - Reality

• What do you really need?
• A fail-safe, accurate method for the chapter to
  keep track of financial position
• Timely reporting
• Reports that give the Board of Directors
• Understanding of financial position of chapter
• Awareness of financial impact of decisions and
  actions
• Confidence in accuracy and integrity of accounts
• Guidance in managing the chapters assets

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Financial Statements - Reality

• What reports will do this?
• Income Expense Reportand/or
• Budget to Actual Report
• Summary of Account Balances
• Cash Statement/Forecast
• A budget or budget-actual report may cover this
• Adequately, also

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Audits and Reviews

• Audits are performed by a CPA
• Professional review of a chapters financial
  management
• Costly hard to find a CPA
• Reviews
• Performed by an independent accountant
• Less costly not as thorough a review
• Internal Audit Committee
• A committee of three or more knowledgeable people
• No cost least thorough
• Be sure to do an audit or review annually!

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Budgeting

• At beginning of chapter fiscal year
• Prepare a list of goals and objectives for the
  upcoming year
• Review past years activities and related revenue
  and expense
• Estimate cost and income for new activities, and
  changes to ongoing activities
• Balance total projected expenses to expected
  revenue
• Have the Board of Directors ratify the budget

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Budgeting

• Importance of the Budget
• Keeps the chapter solvent
• Can be used to authorize expenditures and plan
  events
• Avoids surprises
• Helps the chapter set priorities based on the
  projected funds available

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Managing the Budget

• Report Actual income and expense to Budgeted
  income and expense at least quarterly
• Make necessary adjustments in activities in
  future budget periods
• Amend the budget for new requests for
  expenditures or even revenue
• Is it in the budget?
• Dont allow expenditures that are not approved

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Managing the Chapters Financial Assets

• Internal controls
• Timely transactions
• Investment of chapter funds
• Use of assets for members benefits
• Transitioning to new officer

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Internal Controls

• Checks and balances on
• Cash collection
• Banking
• Asset control
• Approval of invoices and expense reports
• Two signature on checks??
• Petty cash controls
• Spread the control
• Assign and track responsibility

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Complying with Government Regulations

• Taxes federal and state
• Non profit status
• Form 1099 for independent contractors
• Instructors, consultants, speakers
• If paid 600 or more in year
• Even for expenses if receipts are not required by
  chapter for reimbursement
• Sales tax?

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Resources

• Where to go for help?
• Previous finance officer
• Finance officer from another chapter
• Region 7 Director of Finance
• APICS chapter support group (800) 444-APIC
• A CPA or accountant
• The APICS Chapter Financial Manual
• Known as the Finance C Manual
• Stock 01003

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Tools for Financial Management

• Files
• May be electronic, but
• Some must be paper
• System for financial transactions
• Manual.or
• Excelor
• Quicken, QuickBooks, Peachtree, or other
  established accounting system

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Documentation

• Electronic File Boxes

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HOW FILE CABINET WORKS

• Index Page Is Created With Categories
• Links To Get To Each Category Quickly
• Documents Are Posted By Web Master From BOD
  E-mails
• Area where docs are stored is Password Protected
• One User Id/password For All Bod To Use To Look
  At Files

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EXAMPLE OF FILING CABINET
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FORMS IMPORTANT DOCS
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EDUCATION DOCS
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Administration

• Using the Passport Method
• Presented by Myron Murray

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Passport

• Passport is designated as a management tool for
  organizations that are seeking to improve their
  processes, products, and services.
• The program assists leaders in their efforts to
  achieve excellence in effective organization
  management and meeting its customers needs.

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Passport

• Understanding the customers needs
• Measures organizational performance based on
  expectations
• Encourages replanning and continuous improvement

• Requires attention to three categories
• Fundamentals
• Enhancements
• Innovation
• Enhance
• Educational opportunities
• Enhance an organizations capabilities

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Passport

• Provides recognition for the organizations
  efforts
• Participation requires evidence of performance of
  measurable tasks in the three organization
  management categories.

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Levels of Achievement
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Passport
The goal of the Passport Program is to help your
organization grow in meeting the needs of your
customers.
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Activity Log (APP1)

• Assignment of Responsibilities to the Leadership
  members along with a projected completion date.
• Region Liaison sign-off after the item is
  completed with comments where applicable.

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APP1. Activity Log (Pg. 1)
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Enhancements(Documentation is Activity Log)

• 2.1 Region Mtg. Participation
• 2.2 Attendance _at_ Region meetings
• 2.3 Visit by Region or Society Officer to BoD
  meetings
• 2.4 Visit by Region or Society Officer to
  organization meetings (SPS)
• 2.5 Organization visits by members.
• 2.6 Passport Assistance
• 2.7 Revitalization or formation of new org.
• 2.8 Motivation Team bldg Workshop
• 2.9 Technology Utilization
• 2.10 Published Articles
• 2.11 Speeches _at_ APICS Activities
• 2.12 Seminar Notification to APICS
• 2.13 Plant Visits
• 2.14 Speeches by Mbrs _at_ Mtgs/Seminars
• 2.15 Top Management Program
• 2.16 Membership Mtg. Agendas
• 2.17 Organization Meeting Evaluations
• 2.18 Special Projects
• 2.19 Alliance with Other Societies

• 2.20 Member Meeting Improvement Process 2.21
  APICS Educational Research Foundation Support
• 2.22 Student Scholarships or Faculty Development
  Funds
• 2.23 Academic Sponsorship
• 2.24 APICS Library Membership
• 2.25 Donation of APICS Publications to Library
• 2.26 Career Guidance
• 2.27 Student Chapter/Educational Institution
  Participation
• 2.28 Student Attendance _at_ Organization Programs
• 2.29 Intl Student Paper Competition
• 2.30 Instructor Development
• 2.31 Speaker Arrangements Evaluations
• 2.32 Recognition Programs
• 2.33 Interaction w/specific industry grps.
• 2.34 Company Coordinator Program
• 2.35 Leadership Training
• 2.36 Membership Management

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Innovations

• The goals of innovation or organizations are
• To provide more value in an environment of
  changing customer, member, and organizational
  needs
• To simplify processes and eliminate
  non-value-added activity
• To improve volunteer motivation, interest, and
  communications
• Functionally, innovation
• Finds out of the box solutions, not constraints
• Can be (but not limited to) organization,
  technological, or process changes
• Represents a substantial change in the ways
  things get done, as opposed to smaller,
  incremental changes that are part of a continuous
  improvement process

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Innovations

• The innovation process should
• Identify a need or opportunity
• Plan alternatives to address the need /
  opportunity
• Do the implementation
• Check the resultsmeasuring to see if
  expectations were met
• Act on the resultsto further improve the results
• Submit a summary of the following on a single
  page.
• PurposeWhat need or opportunity is being
  addressed?
• ProcessHow is the need or opportunity being
  processed?
• Briefly describe the planning, implementation,
  measurement, and replanning of the initiative
• List the benefits, costs, resource/knowledge
  requirements, and results (outcomegood or
  badand lessons learned) of our project.
• Can your innovation be shared?
• Provide summary information of whats available
  (forms, templates, software, etc.).
• Indicate whom to contact for more information

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Things to Do

• Purchase 1½ 3-ring binder w/insert tabs
• Define Documentation Required and Activity Log
  Check-off requirements
• Doc. Reqd is self explanatory
• PDM Programs, Communications, Quantitative
  Performance Measures and a Narrative
• Activity Log Check-off requires sign-off on
  Activity Log, but strong evidence should be able
  to appear throughout Strategic, Marketing and
  Financial Plans as well as Board minutes