Budget Planning Boot Camp Governors Round Table 2019: Strong Roots, Strong Regions   Budget Planning Boot Camp Iesha Brown Senior Director, Membership & Leadership Development © Soroptimist International of the Americas, Inc. ®

Strategic Financial Management GOVERNANCE PEOPLE PLANNING OPERATIONS MONITORING TECHNOLOGY PROCESS

Budget Development: A 5 Step Process Assemble a budget team Create a budget calendar Prepare for budget process Build the budget Monitor the budget

Step 1: Build a Budget Team Chief Financial Officer Champions the Budget Planning Process Chief Executive Officer Human Resources Director Board of Directors Program Directors

Step 1: Build a Budget Team Region Treasurer Champions the Budget Planning Process Region Governor Region Governor-elect District Directors Program Chairs

Step 2. Create a Budget Calendar Timing is very critical Thoughtful, advanced planning is required Begin 6 months into the year (THE LATEST) Do not work in isolation

Step 3. Prepare for the Budget Process Set financial goals that will guide your decisions, key components might include: Program Goals Reserves Capital Expenses Depreciation Gather data and begin building the budget template Forecast current year results (are we going to come in over or under projected expenses)?

Step 4. Building the Budget Conduct a kick off meeting Budget expenses based on the PLANS you want to implement Identify direct expenses, shared expenses and overhead Make conservative revenue projections using scenario planning (e.g. what do we do if revenue comes in higher or lower than anticipated?) Also make cash flow projections.

Step 5. Monitoring the Budget Ongoing monitoring of the budget is important as it allows you to course correct and revisit throughout the year.

Internal Financial Controls Internal controls are policies & procedures that protect our assets. Procedures include: Handling of funds received & expended Preparation of accurate and timely financial reports Annual or bi-annual audit of financial statements

Why have Financial Internal Controls? Provide members with assurance that our money and assets are safe Help identify a loss quickly to minimize damage Prevent any chance of fraud or theft Protect our volunteers

Examples of Internal Financial Controls Procedures to keep cash and checks safe Regular financial reports Annual operating budget approved by your Board Segregation of duties Officer review Two signers on a bank account Monthly reconciliation of the bank statement Record retention policy

Essential Internal Controls Financial policies Clear role definition Internal financial controls Handling cash Bank reconciliation

Financial Best Practices Follow nonprofit best practices: Clearly written policies & procedures Transparency, accuracy & careful monitoring Board & leadership understanding of financial reports Avoid related party transactions Periodic outside review by an independent professional.

Region Financial Reporting Our Federation Board requires: Annual Financial Statement(s) to headquarters by October 31 Copy of all financial agreements $10,000 and over Procedure in your SIA procedures manual section 9

Healthy Region - Financial *Region is financially solvent. Region should assess how long financial assets/structure of the region can sustain if there is no increase in membership, or a decrease in membership. Region has made its annual financial report to SIA as required in the SIA Procedures F.9.a. Reporting. [HQ data] Region has a budget, and has sent it to headquarters as required in the SIA Procedures F.9.a. Reporting. [HQ data]

Healthy Region - Financial Region calculates profitability is positive and region’s expenses do not exceed revenue. Region calculates its unrestricted reserves can sustain the region for 6 months. Region has diverse streams of revenue and is not solely reliant on dues. Region calculates their net assets balance is strong and increasing.

Supporting Clubs in Your Regions https://www.soroptimist.org/for-clubs-and-members/for-clubs/club-administration.html Club Treasurer guidelines Club Treasurer Calendar Sample Club Budget Audit procedures 501(c)(3) Organizations: Fundraising, the IRS and State Law (US only)

iesha@Soroptimist.org