Making Finance
Management Friendly
Why Is This Important? Members
and stakeholders should be able to easily see and understand the financial
impact of any decision – this is a simple and key governance requirement of
any organisation. It very
hard for AGM’s, committees or boards to make or approve decisions without
it. Example: Say your interclub grows by 50% how
will that impact admin costs or need for staff? How will it impact your shuttle
bill? The financials should reveal
management decisions and the impact of decisions on financial risk should
also be clear. (E.g. New tournament
should break even if we get 40 people attending so everyone can assess the
risk)
Three Key Practices
1) Split your Organisation into Separate Budgets
E.g. juniors,
interclub, tournaments, masters, prizegiving,
etc. Each section should have a profit or
loss. This may
mean
estimating how shuttle usage is divided up etc but
it is
invaluable in giving a clear picture.
2) Allocate Admin Expenses to Each Section
Know roughly how much of your administration
budget
is being used
in each area. E.g. 30% of admin time
on juniors vs
interclub etc
3) Total Transparency
Know why
decisions were made and the impact on the
financial
situation. E.g. we chose to accept a
loss here
because… or
increased efficiency led to savings here… etc