DIRECTOR OF FINANCE WORK BLOG – 24th Post

From my WORK BLOG…

Agendas & Minutes…
New Agendas & Minutes – Posted online. Last week, I was informed that the KSA had not updated its online postings of minutes & agendas in awhile. Today, Chairperson and Director of External Affairs Laura Anderson took steps towards remedying that and you’ll find some new stuff there to read.

Cafe Cleanup & Painting…
On the weekend, Robert Kovacic was contracted to touch up and paint parts of the Cafe-Lounge. I assisted in helping to prep and clean-up, and I took the clean-up four or five steps further by doing a spring clean up of sorts. I was a little sad to see the place not as clean as it could have been (but nowhere near as bad as it was in January). The place looks absolutely great now though, as can be seen by pictures I took. I hope if the Canucks continue into May winning games and moving deeper into the playoffs, we can actually have the cafe open during some of the games as a place where people can come and watch them and enjoy some good eats.

Cafe Finances…
On another note, today I have taken some baby steps toward gaining a better understanding of our KSA Cafe finances. I’d like to see us start reporting on the state of the cafe on a semesterly basis – and our first period of examination will cover January 1 – April 30, 2007. I’ve decided on semesterly for our cafe because [although quarterly (and eventually perhaps monthly) statements and updates would be ideal], each semester is unique and from year to year the fall, spring and summer semesters share similar traits in terms of enrolment and other environmental factors.

By the second meeting of the KSA’s Board of Directors in May, I hope we will be able to present a set of financial statements covering the January – April time period. For me the most important statement will be the Income statement, as well as the cash flows statement.

In terms of the Income statement, we will be able to get a picture of both revenues and expenses, such as:

REVENUES…
– Operating Revenue / Sales (till sales, catering);
– Non-operating Revenue (gain on disposal of capital assets such as the big oven we had that we sold and anything else we may have sold, etc.);
– Any other Revenue or funding sources we may have had (the KSA essentially gives money to assist in the operations, which is something Council wanted broken down more precisely – how much is the Cafe allocated exactly in terms of various funds used to cover wages and other expenses);

EXPENSES…
– Cost of Goods Sold (Inventory @ January 1 is essentially $0; we have not done an inventory as at April 30, but perhaps we need to implement a system where we do an inventory on a quarterly basis to help track this – or on a semesterly basis. The in-between time when there are no classes would be an ideal time to do this – i.e. right now it’s dead. In late August it will be dead. In late December it will be dead.);
– Wages / Salary Expense (the cafe staff, Catherine’s Manager salary expense, Lisa Coan’s graphic design work / contracting expenses for the painter);
– Office Supplies Expense;
– Cafe Equipment Supplies Expense (if any – soup pot, some of the stuff I got in January);
– Business Operating Expenses (business licence);
– Insurance Expense (if any of the current insurance of the KSA covers cafe stuff – we should pro-rate it or if our current insurance plan breaks things down that won’t be a huge problem);
– Repairs and Maintenance (painting, cleaning)
– Discounts (Members Discount / Staff Discount / Discount Coffee Card – these have a cost. What has been “spent” or “expensed” in these areas with the various discounts we have going? These should be broken down so that we have an amount of how much each discount cost);
– Spoiled Goods (have we been keeping track of anything we throw out? If not, we need to start tracking this asap – McDonalds and other cafes track their inventory very closely and I’ve even heard they make you count out all the chicken nuggets thrown away during the day);
– Give-Away goods (have we been tracking what we give away in terms of samples? If not, then we need to start tracking this asap)
– Advertising – print advertising (we have done this in house, but do we have a rough estimate of how much we’ve printed off so far? We know how much it costs to print one sheet of colour printing – so should be estimatable. If we are not tracking this, then we should)

I’m also hoping to know more about any other equipment that may have simply been disposed of because it was old or unusable. Our regulations require a report to Council on any disposal of assets.

I’ve also asked if we can start working on developing a system for projecting revenues and expenses over a one year period. A budget, if you will. Do we have an estimate of the cost of our various discounts and marketing efforts? Do we have an estimate on our return on investments? The KSA Cafe is currently being operated in a similar manner as it was from 2003 – early 2005 and we have a fairly good record of things from that period. So looking at that data, with some of the changes we have made to date, should allow us to do projections for the next year.

Finally, I’m hoping we can have amendments to our budget that will clearly break out how much will be spent on say equipment and other expense areas. As such, the cafe will have it’s own expense section in the KSA’s main budget. This is something that the KSA Council asked for back in January when the overall society budget was adopted. Further to all of this, the KSA started its own separate bank account which was going to be used for all Cafe related revenues and expenditures. So I would like to see us begin using that. That way, we can more easily isolate the expenses and revenues related to that operation of the KSA.

In the weeks to come, similar reviews will be done of all our other revenue sources – from the fitness centre, to our ticket sales, etc. A lot of information will come to the Finance Committee, who has a mandate to review these things, and reports will be going to Council. In the spirit of openess and transparency, as much of this information will be made public as possible.

If you have any questions, feel free to contact me anytime!

– Steve

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