fiscal policies handbook
VA. Budgeting and Expenditure
The Board approves an annual operating budget prepared by the Finance Committee for each fiscal year, authorizes expenditures as specified therein and approves amendments to the budget as they occur throughout the fiscal year. The fiscal year begins July 1 and ends the following June 30 (Handbook, II.A.5.c.3). The Board also approves requests for extraordinary disbursements. Financial matters brought to the Board’s attention are usually referred to the Finance Committee before official action is taken. No money beyond that which is budgeted is spent in the name of the Music Library Association without prior, formal approval by the Board. In consultation with the Fiscal Officer, emergency budget action/revision may be taken between Board meetings, if preceded by a unanimous vote of the President, Vice-President/Past President and Recording Secretary (Finance Committee minutes, 05/2010, replacing language that was not consistent with Handbook). Such action is ratified at the following Board meeting. IF during the course of a fiscal year the Board approves unbudgeted expenditures, it amends the budget and identifies the source of income which is to cover the expenditures. Depletion of the Association’s reserves is to be avoided. (Handbook, II.A.5.c.3)
VB. Budget Requests
At least 2 months before the spring Board meeting, the Fiscal Officer will announce a call for budget requests for the next fiscal year budget. Budget requests will be submitted by all Board members, Special Officers, Editors and Committee Chairs. Budget requests may also be submitted as needed by Roundtable Coordinators, Joint Committee Chairs and Representatives to other organizations..
VC. Budget Preparation
As chair of the Finance Committee, the Fiscal Officer assembles the budget requests for the new fiscal year and requests accounts of actual income and expenditures for the current fiscal year to date from the Administrative Officer. A budget template should be requested from the Administrative Officer approximately 6 weeks before the spring Board meeting so that budget requests coming from members may be entered.The proposed budget should include five columns for each budget line:
- Actual income and expenditures to date
- Projected income and expenditures for current fiscal year
- Projected income and expenditures for the new fiscal year
- Percentage difference between projected figures for the new and current fiscal years
- Percentage difference between the actual (corrected for twelve months) and projected income and expenditures for the current fiscal year.
The purpose of such a report is to allow the Board to understand quickly how accurate its budget and expenditures projections have been and where significant changes in income or expenditures are being recommended or anticipated by the Finance Committee. The Fiscal Officer sends this material to the Finance Committee so that it will arrive no later than two weeks before the spring Board meeting. The meeting of the Finance Committee is scheduled the day before the full Board meeting.
The Finance Committee considers the budget requests, compares them to actual income and expenditures for the fiscal year to date and prepares a projected budget for the new fiscal year. After the Finance Committee has made its decisions, the chair presents the recommendations of the Finance Committee to the Board for approval.
The Finance Committee should budget the convention, publications other than Notes, and other sources of revenue to cover costs or generate a surplus. (Handbook, II.e.12.f)
VD. Budget Approval
Following the Board meeting at which the budget for the next fiscal year is approved (normally in May or June) and before the beginning of the new fiscal year, the Fiscal Officer notifies all who have requested funding whether they have received an appropriation and if so, its amount. (Handbook, V.E.2) The Fiscal Officer is responsible for notifying the Convention Manager with the approved registration rates, exhibitor, and advertising fees within one week following the spring Board meeting (Handbook, II.E.12.f).
Typographical/editorial corrections that do not change content or dollar amounts can be quietly corrected by the AO and shared with the Business Office. Clerical errors to financial figures and totals (e.g., transcription errors, omissions, formula errors) discovered in the budget after final Board approval may be corrected in the following ways:
- The AO is authorized to correct any and all financial errors, up to a total $200 (treating both income and expenses as absolute numbers). A Board vote is not required, but the AO must notify the Board at that time, and make note in the next quarterly AO Board report. This authorization should not be construed as authorization to amend budget decisions or reallocate funds. A Board vote remains an option if adequate funding needs to be ensured for a specific line item.
- Board vote is required for cumulative corrections that exceed $200.
- In all cases, the business office and any parties impacted by specific line items must be notified by AO in a timely manner.
VE. Budget Review
The Administrative Officer alerts the Fiscal Officer when on any given expense budget line more money is being asked for or spent than was budgeted. The Fiscal Officer will bring the discussion to the Finance Committee for possible action if a discrepancy of .1% of the total budgeted operating expenses develops on any expense budget line at the level of 2 decimal points (e.g., 6.02, Assistant Administrative Officer). This policy supersedes all previous policies. (Minutes, 09/2012, 09.g; clarified 03/2016, 09.i) [In the budget, the total expenses would be the amount just below 9000, Inventory Adjustment.]
The Fiscal Officer alerts budget recipients to the possibility of budget freezes should the Association experience a shortfall of income. (Handbook, II.E.12.f.)
VF. Budget Lines Summary
4.0. Education Committee Workshops (EOP programs)
5.0. Other income (Development campaigns, interest income)
11.0. Miscellaneous (Investment advisory fees, chapter support, bank and credit card fees)
12.0. Awards issued
6.0. Management services (including Business Office, Board expenses)
7.0. Program expenses (including committees, MLA subsidies)
8.0. Other member services (Publicity, Placement, organization dues)
5.0 Investment income
S6.0 Contributions to award funds and unrestricted contributions
Notes on Budget Lines:
Unaltered reprints of existing brochures shall be charged to the administrative budget rather than to committee operating budgets. (Minutes, 02/2004, X.C)