By Lawrence Tomei
Every association has its revenues and expenses. For a local sports officials association, revenues are often dues and fundraisers while expenses run the gamut from banking fees to rental costs. The best run associations keep close tabs on their finances and can account to their membership for every penny that comes into and goes out of the group. One tool for ensuring an accurate accounting is a simple budget, essential to good stewardship since many groups deal with thousands of dollars every year.
Another tool is a monthly statement of revenue and expenses that tells your organization where the money came from and where it went. You may be thinking that you don’t really need that level of detail in accounting for association funds. After all, your board of directors has been doing it for more years than anyone remembers. Your bills are paid on time and you have even saved for that annual banquet that celebrates the end of the season. That’s more than most associations can say.
Still, a close examination of spending often produces additional benefits. For example, it provides a more accurate forecast of revenues and expenditures, and actually makes you more aware of your spending habits. It can help control finances and free up extra money. It underscores areas of spending that may not reflect the priorities of the organization.
Revenues. Income generally takes the form of dues, fees and miscellaneous earnings. By far, dues grease the wheels of most small associations. Sports officials are rewarded with game fees each time they set foot on the field or court — or at least most of the time. Supporting an association with prompt payment of dues is a reasonable expectation. Other typical income includes fees charged to members and non-members who participate in our professional clinics. Sponsors are solicited to help offset the cost of equipment, meeting locations, clinics and websites in return for access to membership lists to distribute advertising catalogs, for example. Most association bylaws empower the board of directors to suspend any member who is delinquent. On the other hand, excessive dues for activities that do not benefit the entire membership are sometimes the root cause of transfers and resignations. So let’s look at the various pockets of expenses in a typical association.
Expenses. The trick with expenses is to match it with revenues. Overspend and you must answer to an irate membership; under spend and you may miss opportunities. Membership-related expenses cover the cost of conducting your rules meetings and your rules interpreter’s time, renting classroom facilities and paying for training clinics and materials. Evaluators make any association better; investing a few bucks every year for professional development and evaluation is money well spent. Under the general heading of operational expenses, costs associated with printing, supplies, postage, telephone and Internet services provide for promoting your association with a focus on generating new members and more games.
As a partner in the local community, associations are expected to allot for contributions to the common good, both internally and externally. For example, one group may choose to sponsor a scholarship for a participating athlete. Another may be more comfortable contributing to an athletic-based charity (e.g., booster clubs or band associations). Still others may establish a foundation to memorialize a past official, coach, or district representative. Such examples represent suitable expenses for an officials association.
Finally, there are numerous miscellaneous costs for running any organization. Some boards receive minimal compensation to offset travel, attend special events or pay out-of-pocket expenses. Bank fees, bookkeeping charges and computer supplies are other examples of routine cost-of-doing business expenses.
Some associations supply their treasurer/bookkeeper with accounting software that provides a reliable, practical tool for tracking revenue and expenses. Most packages provide a simple suite of tools that make reporting quick and easy.
Close scrutiny of an association’s revenues and expenses is time well spent for many reasons. First, the officers and board of trustees, as elected stewards of the association’s funds, must answer to a membership that has every right to expect that funds are appropriately disbursed. Second, funds are raised and spent in support of established (i.e., voted on) association goals. In perhaps more crass terms, money drives the association toward its goals and money misspent results in missed opportunities. And third, a well-documented revenue and expense statement reduces misunderstanding; every transaction is conducted with the full knowledge and expressed consent of the members.
And it will help answer where your funds should go in the future.
Lawrence Tomei is the vice provost for academic affairs at Robert Morris University in Pittsburgh. He has been a member of the West Penn Football Officials Association since 1994 and its president since 2013.
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