Stewardship This presentation will focus on stewardship.

Learning Objectives Meaning of stewardship Guidelines for implementing grant projects Raising and spending TRF funds Accounting practices Reporting requirements Role of district leadership By the end of the presentation, you will understand the components of stewardship, how to appropriately raise and spend TRF funds, grant accounting guidelines, reporting requirements and the role of district leadership in ensuring that proper stewardship guidelines are upheld.

Stewardship Treating TRF funds as a sacred trust Competent and thorough supervision of the project Standard business practice Reporting irregularity to TRF Implementing projects as approved What is stewardship? The Trustees of The Rotary Foundation have defined stewardship as the following: Treating TRF funds as a sacred trust because they represent donations from Rotarians who have entrusted their contribution to TRF for service projects that other Rotarians are implementing. They make their contribution in good faith that they will be used by fellow Rotarians to do good in the world. Competent and thorough supervision of the project by Rotarians, ensuring that there is good transparency of how funds are used at the club and district level and among the communities receiving services. Implementing projects and managing project accounts according to standard business practice guidelines. Reporting any irregularity in management of projects such as suspected inflation of invoices, or misuse of funds should be reported. TRF, the partnering club or district and their own district should be informed. Implementing projects as they were approved by the Trustees, based on the information provided in the application. If a budget item should change from what was originally approved, the club or district sponsoring the grant must always request prior permission from the staff at TRF to change the budget.

Stewardship Financial review of projects Timely and complete reporting 4-Way Test Declaration of Rotarians in Businesses and Professions Stewardship encompasses these components as well: Conducting regular financial review of projects. It is recommended that club and districts have their project accounts reviewed independently on an annual basis. For competitive Matching Grants over $25001 and all 3-H grants, Rotarians are required to submit an Independent Financial Review annually from the date of the first payment. Submitting reports to TRF in a timely and complete manner. When in doubt – use the 4-way test to guide your decision making about managing the grant and accounting for the funds. Recall the high ethical standards that all Rotarians are called to live out as stated in the declaration of Rotarians in Business and Professions.

Stewardship The trustees rely on the integrity of the clubs and Rotarians engaged in project implementation to ensure that funds are used effectively for the purpose for which they were given. The trustees rely on the integrity of the clubs and Rotarians engaged in project implementation to ensure that funds are used effectively for the purpose for which they were given. It is up to all Rotarians to demonstrate that integrity in every aspect of project implementation.

Project Implementation

Keys to Success Project meets real needs of receiving community Rotarian, club, district, and community support (host and international) Proper fiscal oversight Strong partnerships Project plan with goals and anticipated outcomes Any successful project must identify and provide for “real needs” of the community. It is not enough to provide a fish when someone is hungry. If you teach them to fish you have met their real need because now they can feed themselves. Clubs must work to identify real needs and develop projects that serve those needs. Rotarians, clubs, districts, and communities in the project country and internationally need to work together collaboratively using their technical expertise and resources to make the projects a success. Both the host and international sponsors of a grant must ensure that proper checks and balances are in place to guarantee proper fiscal oversight of TRF funds. Effective partnerships and communication are the backbone of any successful project. Communicate clearly and often. Effective partnerships are the result of effective communication. A successful depends on the creation of a project plan with clearly explained goals and anticipated outcomes. Working with your partner to set goals and anticipated outcomes will help you to measure your success and know if the project is working or not.

Effective Communication Know project partners Anticipate cultural misunderstandings Discuss problems openly and freely Communicate in a timely manner Practice patience and good humor Communication is the foundation of any successful partnership. What are the keys to success for effective communication? Know your project partners A partnership should be established before an application is submitted. Your international sponsor is a partner in the project. Anticipate cultural misunderstandings Understand that international partnership may include cultural misunderstandings. Be ready to try different ways of communicating your message Discuss problems openly and freely With this, make sure that you communicate your problems as well as your successes. The intent of international partnership is to foster support and understanding. Your partner may have a solution. Communicate in a timely manner Partners expect to be treated as equals. Even though they are often not able to be in country, they greatly appreciate timely communication. Practice patience and good humor Humor and Rotarian empathy helps the process

Effective Partnership Clearly defined responsibilities Detailed plan of action Clear and open lines of communication Knowledgeable and motivated partners Mutual respect In the realm of implementing successful projects, partnership is equally important as communication. In fact, the two go hand in hand. What are the keys to success for effective partnerships? Clearly defined responsibilities Make sure that your club, your partner, the beneficiary, and the cooperating organization understand what is expected of each entity Detailed plan of action This plan of action includes rolls and responsibilities, a timeline of implementation, outcomes, and reporting Clear and open lines of communication Again, establishing a good working relationship with your partner ensures good support of a project. This includes: Knowledgeable and motivated partners Mutual respect

Project Committee Oversees and implements project Reports to board of sponsoring clubs Comprised of at least three members Project committees must be established for all projects funded by humanitarian grants. Both the host and international partners must form committees. These committees are responsible for overseeing and implementing the project. They are responsible to the sponsoring Rotary clubs and must report to the boards of these clubs. The committees must be comprised of three members each.

Committee Members Committed Experts Accessible Respected Responsive Multi-lingual When selecting Rotarians to serve on the project committees, it is important to keep in mind some qualities that these individuals should possess. Committee members should be committed to the project for its duration. They should be experts in the subject being addressed by the project. If the project is digging water wells, it would be helpful to have someone on the committee who is a water engineer by profession. Members of the committee should be accessible and preferable have access to email. These Rotarians should be respected members not only of their club but also of their communities. They should be responsive and able to dedicate the time necessary to successfully implement the project. Ideally, members of the committee should bring to the group the language skills needed to work with the project partners. Lastly, the committee members should be selected based on their lack of conflict of interest. If a Rotarian from your club is also the president of a cooperating organization with whom you are going to implement a grant project, this person would not be a good candidate to serve on the Rotary club’s project committee. Rather, it would be better to have a different Rotarian serve, one who doesn’t have this potential conflict of interest.

Fundraising

Appropriate Fundraising Expectations: Service Above Self Beneficiaries should not contribute funds to receive assistance. Club must keep accurate, detailed records of donations. Reciprocal relationships should not be formed. When we speak about stewardship, we refer not only to the proper use of grant funds, but also responsibility in raising those funds. In the realm of fundraising, there are a number of expectations that TRF maintains for Rotarians: Service Above Self Self should not come before service. Beneficiaries should not contribute funds to receive assistance. Club must keep accurate, detailed records of donations. Donations of other individuals should not be appropriated for personal gain of recognition without the express consent of the donor. Reciprocal relationships should not be formed This means that all relationships should be transparent. No relationship should be formed with hidden benefit.

Appropriate Fundraising Expectations (continued): Funds should be used for intended purpose. Paul Harris Fellow recognition should be obtained only by: contributing US$1,000 to TRF receiving the voluntary recognition of another entity’s US$1,000 contribution Any time a deviation takes place from the approved project and/or budget, the project sponsors must receive permission from TRF. PHF recognition should only be received by either: Contributing US$1,000 Or by accepting the contribution wishes of another entity’s US$1,000 contribution. Contributions may not be taken from individuals and appropriated for personal recognition.

Spending TRF Funds

Appropriate Use of TRF Funds Humanitarian projects Rotarian participation in projects Development of Rotary networks Spend consistently with TRF guidelines and approved application Vigilant oversight In keeping with the standards established by the Trustees, the appropriate use of TRF funds should include the following: Funds must be used to support humanitarian projects that benefit a community in need Rotarians must actively participate in projects The grant funds contribute to the development of Rotary networks Funds must be spent consistently with TRF guidelines and the approved application Vigilant oversight of grant funds by the Rotarians sponsoring the grant

Eligibility Guidelines Grant funds must not be used for: Construction/renovation Purchase of land or buildings Salaries Cooperating organization expenses Post-secondary education International travel (except Volunteer Service and 3-H Grants) Grant funds may not be used for any of the following items: Construction or renovation of any structure in which individuals live, work, or engage in any gainful activity such as buildings, containers, and mobile homes or structure where individuals carry out any type of activity including manufacturing, processing, maintenance or storage, including provision of new services or upgrade of facilities (i.e., electrical and plumbing). Purchase of land or buildings Salaries, stipends, or honorariums for individuals working for a cooperating organization or beneficiary Operating or administrative expenses of another organization Post-secondary education activities, research, or personal or professional development. International travel (except for Volunteer Service and 3-H Grants)

Eligibility Guidelines Grant funds must not be used for: Establishment of foundation or trust Personal benefit Duplication of TRF or Rotary program Reimbursement of existing project Excessive support of beneficiary Inauguration parties or meetings Grant funds may not be used for the additional following items: Establishment of a foundation, permanent trust, or interest-bearing account Personal benefit of a Rotarian or family member of a Rotarian Projects that duplicate a TRF or RI program Projects already undertaken and in progress, an existing project, activities primarily sponsored by a non-Rotary organization, or projects that are already completed Excessive support of any one beneficiary Inauguration parties or meetings

Accounting

Financial Records Demonstrates that funds were used effectively and efficiently Meets the conditions of the grant award Meets all legal requirements Embodies trust and opens the door for future projects In addition to spending funds appropriately, another key component of stewardship is maintaining proper financial records. What is the purpose of maintaining flawless financial records? Demonstrates that funds were used effectively and efficiently Meets the conditions of the grant award Meets all legal requirements Embodies trust and opens the door for future projects

Accounts Separate accounts should be established for each grant Payment should be made to a bank account opened specifically for the project Project account name should be such that it is easily identifiable with the club and project When opening project accounts, the following guidelines should be followed: Where feasible, separate accounts should be established for each grant. This helps to keep the funds for each project separated from other funds. Grant payment should be made to a bank account opened specifically for the project. The name of the project account should be such that it is easily identifiable with the club and the project.

Payments Checks No payments in cash Payment made by check helps facilitate necessary documentation. How should payment for grant items be made? All payments should be made with cheques. No payments should be made in cash. Payment made by cheque helps facilitate necessary documentation.

Reporting

Reporting Celebrates successes Communicates accomplishments to TRF Demonstrates good use of funds Provides transparency Meets government requirements Offers lessons learned We have discussed the importance of appropriate fundraising, proper use of grant funds and the importance of maintaining proper financial records. What does reporting accomplish? Celebrates the successes of the project Communicates project accomplishments to TRF Demonstrates to donors the good use of TRF funds Achieves transparency and judicious use of grant funds Fulfills government requirements Demonstrates lessons learned

When TRF Reports Are Due Progress reports are due at least every twelve months for the life of the project Final report is due within two months of the project’s completion Please note that the first report is due twelve months after the paid date of the grant. Subsequent reports are due at least every twelve months from the date when the previous report was received at TRF. The final report is due within two months of the project’s completion.

Report Content Project accomplishments Rotarian involvement Information on the beneficiary Statement of income and expenses Bank statement All reports must include the following information: A detailed description of the project accomplishments A full description of Rotarian oversight, management, and involvement in the project A narrative statement about the beneficiary A statement of income and expense, providing an itemized list of expenditures A bank statement which correlates to the statement of income and expenses

District Leadership

Role of District Leadership Facilitate and encourage Rotarians to fulfill: Stewardship responsibilities Reporting responsibilities Partnership obligations Legal obligations to TRF and local Government District leaders have a very important role to play in the implementation of grant projects. They are expected to assist and encourage Rotarians to fulfill the following obligations: Stewardship responsibilities Reporting responsibilities Partnership obligations Legal obligations to TRF and local governments

Role of District Leadership Report misuse and suspected misuse of funds to TRF Prevent inappropriate use of funds through: Training Positive leadership In addition, it is expected that district leaders will report any misuse or suspected misuse of funds to TRF. Most importantly, district leaders are expected to help prevent the inappropriate use of funds through training on stewardship and by providing positive leadership.

Stewardship As stewards of The Rotary Foundation, the trustees are responsible to the donors to demonstrate that donations were used appropriately. As stewards of The Rotary Foundation, the trustees are responsible to the donors to demonstrate that donations were used appropriately. You are the donors to your foundation. As such, it would seem only natural that you would want to ensure that your money is used as you intended for it to be used.

Stewardship A donor who understands that funds were used in an appropriate and responsible manner is more likely to give to the Foundation again to support projects. In addition to respecting the wishes of the donor, another key point in stewardship is that a donor who understands that funds were used in an appropriate and responsible manner is more likely to give to the Foundation again to support projects. We all want for the wonderful programs of The Rotary Foundation to be able to continue. However, they can only continue if they are supported by generous donations. Therefore, it is up to all of us to ensure that we maintain the highest levels of stewardship, ensuring the continued success of our Foundation.

Questions?