Thursday, 22 April 2010

Does your committee understand your reports?

One of the hardest things about being a treasurer is that you feel like you are totally responsible for the finances of your agency.  Could it be the way people run for cover when they see you and your reports coming that makes you feel that way?  Perhaps it is the way the collective eyes of your committee members glaze over the moment your report is introduced?

The role of treasurer is yours but the financial decisions are made by the committee, not by you alone. That means that all committee members are equally responsible and need to understand the reports that you are presenting. 

At one regional Community Health Service it became quite obvious to the treasurer that Board members didn't understand the reports they were getting.  Some members were not even familiar with accounting terminology so discussing liquidity and profit ratios sent them off into a vacant mental space.  You can't afford to let that happen.  In this case, the treasurer decided to make a special presentation to the Board which explained in simple terms how the finances worked across the agency.  Each Board member was given a booklet which explained the terms used in a treasurer's report along with a simple explanation of the budget process.  The examples in the report were specific to the agency so they were quite real to the readers. While this didn't turn them into financial experts it did give them enough information that they could read and question the treasurer's reports. 

You might not have to go this far with the members of your committee but I think part of your role will always have to include teaching people to understand simple financial reports.  It shifts the load from your shoulders and puts it back where it should have been - spread fairly across the shoulders of every committee member.

At your next meeting watch the faces of your committee members.  Do they look as though they understand what you are saying?  If they don't you need to take some action.

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