ALA FINANCE BEST PRACTICES ASSOCIATION FOR LIBRARY SERVICE TO CHILDREN BUDGET PROCESS 2011 Midwinter Meeting Friday, January 7, 2011

ALSC’s Finances Background  Simple structure- no chapters or sections  Focus on strategic budget and finance operations  Added Fiscal Officer  Budget Committee includes Fiscal Officer, Vice- President/President, Past-President  Funding decisions based on strategic plan and continuing operations  11Endowments and Long-Term Investments offset operations and provide opportunities to expand services Awards, scholarships, continuing education, leadership development

Budget Preparation  Continuous cycle  September - November  Staff review budget notes and evaluate projects  Create division budget assumptions Use past trend data Look at variances and adjust Factor in new products or services  December  Prepare budget summary and narrative for Budget Committee

Detailed Explanations

Budget Summary

Budget Narrative

Budget Preparation cont’d  Midwinter Meeting  Budget Committee meets twice Review strategic plan, operations, initiatives Review endowment performance and activity Increase funding if necessary Review requests for funding  Discuss ALA finances  Prepare and present preliminary proposed budget to the ALSC Board

Endowments  Operating Fund Reserves (Net Asset Balance)  Four or more months is acceptable  “Remarkable” organizations carry an average reserve of 90% of annual expenses.  Endowment/LTI Transfers  $300,000 earmarked for a new Board Initiatives LTI  Increase fund balances of existing LTIs through transfers Cover new expenses

Budget Preparation cont’d  Midwinter Meeting  Budget Committee meets twice  Review strategic plan, operations, initiatives  Review endowment performance and activity Increase funding if necessary Review requests for funding  Discuss ALA finances  Prepare and present preliminary proposed budget to the ALSC Board

Budget Preparation cont’d  Board will review and approve preliminary budget for presentation to BARC in spring.  February-June  Executive Director incorporates necessary adjustments as assumptions change or Board action requires  Executive Director presents budget to BARC  Executive Director prepares final preliminary budget  Budget Committee reviews and makes recommendations to Board  Board approves final budget

Budget Preparation cont’d  July-August  Executive Director prepares monthly allocations Professional membership renewals Non-serial publication production schedule Conference and event expenses  September Start of fiscal year

Monitoring  Staff monitor and track their project areas  Tracking spreadsheets developed from budget notes  Staff process accounts receivable and payable  Staff provided with ALA chart of accounts and ALSC project numbers

Chart of Accounts

ALSC’s Project Numbers

Monitoring cont’d  Staff monitor and track their project areas  Tracking spreadsheets  Staff process accounts receivable and payable  Staff provided with ALA chart of accounts and ALSC project numbers  Monthly reconciliation by Executive Director  Review FRX reports looking at variances  Look for line items that were not budgeted  Correct any miscodes or errors on monthly basis  Provide monthly summary report with analysis to ALA and Budget Chair

Mid-Year Projections  February/March  Begin to formulate mid-year projections Analyze year-to-date income and expenses against allocations Look at overall operating fund line items Drill down to project level line items  Submit projections to ALA and Budget Committee  Continue to monitor and analyze in monthly reports  This helps both the Division and ALA project where they will be at the end of the fiscal year. Allowing for expense reductions, if necessary.

Contact  Aimee Strittmatter  