February 2016

February 2016 Newsletter

 

This Issue

Making Committee Work Exciting – Do you know how?

Intern(ational) – Uni students now add to CCA’s intern line-up.

Office 365 – Extremely useful for NFPs, but hardly anyone knows what it does.

The Road to 2016 – Outputs and Outcomes: the little difference.

 

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80/82 Fitzgerald Ave, PO Box 13 625; Ph. 669 0542;

Harald: harald@commaccounting.co.nz; Rhys: rhys@commaccounting.co.nz; Yvette: yvette@commaccounting.co.nz; Nick: nick@commaccounting.co.nz

Governing with Interest

Whenever I talk to people outside of work about my work I get stories about people’s stints on committees. Any such stories are usually accompanied by lots of sighing, though. Every now and then we get people here showing some interest in helping out some community group or other with their skills, and more often than not this comes with the caveat ‘but only if I don’t have to go to meetings’. In fact, I have used this line myself in the past.

We all seem to be much happier putting in three times the hours hammering together a playground for free, manning sausage sizzles at school fairs or even slaving over the organisation’s accounts than sitting on one of those dreaded committees.

You can lessen the pain of meetings by having it well facilitated, i.e. a chairperson who keeps it snappy and within a timeframe. Still – it all feels like work and it doesn’t make for good governance if most committee members just want to get back home again as quickly as possible.

There seems to be two broad ‘types’ of committees or Boards (I use the words interchangeably here). In well- established groups such as sports clubs, PTAs, school Boards, toy libraries etc. committee work is about keeping things ticking along, and more often than not about fundraising. Committee members may be driven by a sense of social obligation and maybe see it as a way to get to know members of the local community better. Such meetings are held together best by good food and hot drinks.

Charitable groups, on the other hand, often spring from an idea which is given direction and leadership by one or two key people, often the founders. The committee is sometimes hand-picked or deliberately chosen and generally happy to do their part to enable the drivers to have a good shot at it. There is usually a little more excitement, sometimes strong views, and disagreements occasionally turn ugly. In situations like this the committee’s most useful role is that of providing checks and balances. People with good ideas, even great leaders and those with lots of charisma, still need others to provide reality checks and to keep a critical eye on money and other important stuff. In fact, a few entrepreneurial managers have been complaining to me about quite how hands-off their committee is: they certainly don’t want a committee to meddle in the day-to-day affairs, but they want to hear questions, even uncomfortable ones. On such committees, members help most not by blindly giving the key people whatever they want, but by turning their brain on and even be devil’s advocate sometimes.

Whatever your committee is like, money plays a key role. The point of any not-for-profit is to apply money to a purpose – without money there would be no need for a formal structure. Money is not the purpose, but it is the tool. The mistake often made is to leave money matters to one person such as the Treasurer or the manager. I believe everybody on a governance committee or Board needs to understand the organisation’s finances.

And there must be ways of making committee meetings less of a drag. Ideas anyone?

Harald

More Interns Than Ever

CCA has agreed to take two student interns per semester through Canterbury University’s Master of Professional Accounting programme in addition to the two to three accounting students we usually take from CPIT each semester. This adds to our capacity in terms of working hours, but also requires quite a bit of time for training, supervision and quality control. Our interns find out pretty quickly that not-for-profit accounting is not usually ‘easy’.

It is exciting to have students from the two major tertiary institutions in Christchurch and build connections with both. This helps our mission to give not-for-profit accounting a higher profile in tertiary education for accountants.

The present line-up, whose help is much appreciated, is:

Thorsten Juelich, CPIT student (Exchange programme with University of Dortmund (Germany)).

Hadyn Downes, CPIT student (Bachelor of Applied Management, accounting major).

Gabriella Finnis, BA, UC student (Master of Professional Accounting).

Alpana Bhatia, Bachelor of Technology, UC student (Master of Professional Accounting).

Re-Enrolment Time

Sometime during March we will be sending out our annual re-enrolment notice and ask you to update your details. There will be some additional questions this year for the purpose of being able to give our funders some statistics and also for our own purposes such as financial forecasts.

To re-enrol with CCA services does not cost anything, but you have to have at least the intention of using our services in the next 12 months. If we do not hear back from you we will move you off our client list, and you will also no longer receive this newsletter.

What is Office 365??????

Despite Microsoft Office 365 being completely free to Charities and some other not-for-profits we are not aware of any of our clients using it yet. This may be because most people may not actually understand what it is or does.

It has little to do with MS Office, the software package that includes Word, Excel, PowerPoint etc., although online versions of them are included in Office 365, much like Google Docs. Its key functionality is that it principally acts as a (cloud-based) server.

So what does a server do? The most useful aspect of it is that all your documents are in one place that is accessible from anywhere with an internet connection, and you can give individual users individual access to individual files. At CCA, for example, we use it to give our interns access only to those files relating to the client they are working on. Board members have access to certain files that staff cannot see, etc. Also known as ‘SharePoint’ within Office 365 this can be organised in various different ways.

Each new user automatically gets their own email address and personal document storage space. Computers running Windows 10 can use the Office 365 login for new users, meaning you do not have to set up each new user on each computer you have – one login will automatically work on all computers.

On a day-to-day basis it works very much like ‘Dropbox’. You have a folder on your computer called ‘SharePoint’, which contains all the files you have access to. You open them from there and work on them. When closing they are automatically uploaded to the server.  If one person has a file open, another cannot open it at the same time, although several people can work on the same file simultaneously if it is opened through the Online versions of Word, Excel or PowerPoint.

Since Microsoft has acquired Skype some time last year, Office 365 has in-built teleconferencing facilities with video, audio and remote presentations – great for groups with staff or Board members spread over different parts of the country. In theory you can also host your web site the Office 365, but in practice it is a poor tool for anything other than an internal or members-only web facility.

We had enough tech-savvy people here at CCA to set it up ourselves, but most groups would probably need someone else to do it for them and provide some training. Some training is available through TechSoup (www.techsoup.net.nz) generally free of charge. To get Office 365 you need a TechSoup validation token, which is free to all registered TechSoup users.

You can find more info here: https://www.microsoft.com/about/philanthropies/product-donations/products/office365nonprofit/

The Road to 2016

Monthly feature to prepare for the new Financial Reporting Standards for Charities.

Of Outputs and Outcomes

New to the world of Tier 3 and 4 Charities is the ‘Statement of Service Performance’. At CCA we will use the title ‘Statement of Service Activity’ to get away from the connotations inherent in the word ‘performance’ – unless you instruct us otherwise for the work we do for your organisation, of course. Regardless of semantics, what Charities are asked to report on are ‘Outcomes’ and ‘Outputs’ that have been achieved during the reporting period.

An ‘output’ generally refers to something numerical: the number of workshops held, number of clients seen, number of members participating in events etc. An ‘outcome’ is a more qualitative measure of the consequences of your work. To report an ‘outcome’ you usually take into account what you wanted to achieve in the first place, i.e. your organisation’s purpose or mission. The XRB standard (para A41 in Tier 3, para A32 in Tier 4) describes outcomes like this:

“The outcomes are likely to be closely related to the mission/purpose [..]. The main difference is that the mission/purpose is usually stated in broad or general terms and applies over the life of the entity. By contrast, the description of the outcomes […] should be more specific and focused on what the entity is seeking to achieve over the short or medium term.”

Not all Charities have high and lofty goals about changing the world, and for many the outputs actually are more or less identical to their outcomes. For example, finding a job for a jobless person can be both considered an output and an outcome.

The Standard does not prescribe what kind of outputs and outcomes have to be reported on but seems to suggest that organisations should not go to any extra lengths to find this information: use what you already have!

There are three key considerations when deciding what and how much to report here:

  1. Who is using this information? If you are producing an annual report or chairperson’s report anyway then there is no point in duplicating all of this information here, where it is likely to largely escape any attention as an attachment to your Charities annual report. Many funders may ask for a bit more of a story, too, although the information may be useful to those who don’t.
  2. These are publicly available reports and you need to be aware of any privacy implications of what you report here.

If your Statements are audited, and your auditor abides by International Auditing Standards (like CCA does), this information must be included in this audit as well. This means that whatever you report here must be well documented and be backed up by evidence in this case.

 

Workshop: GST – The NFP Version

NFPs have many transactions that are rare in the business world: donations, grants, government remittances, on-behalf transactions etc. Software cannot help you make the decision whether a particular item carries GST or not – you have to know how it works. More info and registration here.

Tuesday, 1 March 2016, 10 am – 12 pm

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Workshop: Wise Tier Choices

Charities now have to follow financial reporting rules, and their choice of Tier can have significant implications on their compliance costs: day-to-day admin as well as accounting and audit. Make sure you make the right choice.

Run in association with Canterbury Community Law Centre. To register email susan.wallace@canlaw.org.nz or phone 0508 CANLAW.

Tuesday, 8 March 2016, 1 – 12.30 pm

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Workshop: Consolidating Two or More Entities

A workshop specifically for those Charities which will now be required to produce a consolidated set of financial statements incorporating another self-managed entity or group under their control.

To find out if this applies to you check out the definition of ‘control’ on the Charities web site: https://charities.govt.nz/new-reporting-standards/financial-reporting-and-control-relationships/

For info about the workshop and to register see here.

Tuesday, 29 March 2016 10 am – 12 pm