Virginia Wing's "Wing Bank Solution"

[Ladyhawk]

Is anyone out there familiar with Virginia Wing's "Wing Bank Solution"?  It's a program for managing squadron funds that the NEC has decided should be implemented nationwide and it will be phased in over a 3 year period.

The May NEC meeting minutes describe it as follows:

"(h) Unqualified Audit Opinion: Based on the direction of the Board of Governors to
have an unqualified audit opinion, CAP would like to implement a system similar to what the VA Wing has to consolidate all unit funds below wing level to be managed by wing headquarters. In Virginia, the unit funds were turned over to wing for management and accountability, but the squadrons still retained control of how the money was spent. The Virginia Wing test proved successful and would be the least expensive route toward obtaining an unqualified audit opinion for Civil Air Patrol. If approved, a minimum of 15 wings will be identified as Phase I to implement this initiative nationwide.  Selection of wings or wings volunteering for phasing in this program will be approved by region commanders, but no wing on a very high financial risk level will be a part of Phase I. Recommendation: A plan to extend the "Wing Bank Solution" to other wings and establish a three year goal of obtaining an unqualified audit opinion." p. 26-27

I've recently been informed that my Wing (Georgia) will be implementing this program very soon.  There are a variety of aspects to this idea I'm uncomfortable with.  I'm also expecting the squadrons under my command to be resistant to turning over their funds to the Wing to administer. 

The fact that CAP regs haven't actually been changed to reflect this methodology doesn't make me very happy either.  However, I expect that the regulatory changes are just a matter of time.

Thanks in advance for any input on this!

[whatevah]

Delaware Wing started this in the spring... at first, we liked the idea (no more finance reports to do), but it's a pain to get money to pay for stuff or reimburse members.  We have to submit a form to Wing with signatures from the squadron finance comittee, then wing has to get 2 signatures for the check before they can give it to us.   For our money...

[arajca]

On way to help aleviate some issues would be to have a set Check Cutting day each week when the wing AA would have all the checks ready and two signers would come in and develop writer's cramp signing. The signers could rotate (I believe most wings have more than just two signers) so no one is being unduly put upon.

Not a total solution, but it would help speed things up and reduce the impression of favoritism.

[capchiro]

Does this mean that I would turn over all my squadron donations and dues to Wing and then ask for it back?  What about my bank debit card that I now have?  I guess that would be given up also?  How would one propose that I order rank, ribbons, etc., from Vanguard and/or elsewhere?  I don't think this is a good idea.  Considering the lack of financial support we have received from Wing in the last four years, and the fact that our Wing personnel are too overworked to get their current work done timely, I just don't see how this will work.  With the centralization of everything at Maxwell and everything being on computers, why don't we just give it all to National and they can give it back when they get good and ready?  I think this is just one more way of taking away from the squadron for no good reason.  Why should Wing get any interest earned while our money is setting in their account?  If our people earn this money, it should stay with us.  JMHO

[Ladyhawk]

Yes, this does mean that you would be turning over all your unit funds to Wing HQ to administer.  I don't think debit cards are going to be authorized since they want all funds to be distributed by check so that Wing can track expenditures.  Petty cash accounts, as now, will not be allowed. The question of account interest hasn't been addressed at this point as far as I know.

I also have a great many concerns about how the "logistics" of this thing are going to work.  Our wing administrator, as wonderful as I think she is, already has her hands full.  I can't imagine how she's going to handle bill paying for 40 units (# of sqdns. & flights in GAWG).  If Delaware with only a handful of units has slow response time in getting checks, can you imagine how much fun we're going to have!

It's my understanding that units will be allowed to make their own deposits, if they wish.  GAWG uses Wachovia Bank.  There are units in certain parts of the state where the CC or Finance Officer would have to drive a considerable distance to make a deposit at a Wachovia location.

Bottom line is that it doesn't appear that we're being given a choice about doing this. 

Hope you're planning to make the Commanders Call on Saturday.  This item is on the agenda!

[MAJORZ04]

Fellow Baffled CAP Members;
Here comes another edict from National HQ that will cause more problems.
If it isn't uniform changes (that we really dont need, except for or CG wanting
to wear shiny stars not sewn stars on his bus drivers uniform) now it is a way for SQRDN's to "not" handle there own money.  Our SQRDN does things to help
itself... solicit donations... have fund raisers... etc... etc.  To have our wing get
that money to give back to us, after we have to prove why we need it, is entirely unacceptable.  What about when we "help" a cadet with uniform or registration
fees, without making a big deal about it.  Some units have a scholarship fund...I'm sure they will not Wing to administer that !!!!
Our Wing CC's must be too scared to "just say no" to these ideas...What is the CG going to do..."send them to Vietnam"
It is time for the back-bone people of CAP .... the members... to get a back-bone...Contact your leadership and express your views....They are our voice...
All the reports show our membership numbers are dropping.... well "DUH"

[mikeylikey]

If you did some research you would find out that those "petty cash funds" most SQD's have are illegal.  As non-profit, the money needs to be at the Corporate level.  That level is Wing. 

This plan will make everything money related flow more smoothly!  Just think, Wing will automatically pay your rent each month along with any other recurring bills you have.  If you need to buy junk from vanguard, get a credit card, buy the crap early in the month, and wait for reimbursement from Wing to pay the card off. 
There will need to be some planning involved with how to spend squadron money now.  We will get rid of the spur of the moment "lets buy a new radio, because we may use it sometime". 

I just don't see the problems with this plan.  As soon as a larger wing, say PAWG begins in October with hundreds of thousands of dollars, then we will see that it is a good plan.  This will be no different than commercial business operations.  Take a retail franchise, look at how the individual store operates and you will see no difference. 

In the end, this is what the FEDS want anyway, so lets make them happy!

[capchiro]

It would appear that you are not in the management, ie, command structure of a squadron.  I take affront to the mere implication that I am not trustworthy enough to handle squadron funds, which I have managed to raise at a squadron level.  I can guarantee you that there will not be near as much fund raising at the squadron level if we have to go begging and substantiating a reason to get our money back.  I also will have second doubts about ordering $500.00 worth of rank, ribbons, etc., from Vanguard on my personal credit card and waiting for Wing to re-imburse when they get around to it.  As a squadron commander, I have to make monetary decisions in a timely manner.  I have had cadets that couldn't afford to go to encampment unless the squadron "sponsored" or "scholarshipped" them.   I don't have time to wait for Wing to take a month to two months to review the request, think about and finally yeah or neah it.  If I can be trusted to run a squadron with 40-50 members, I think I should be able to handle any finances we have.  I don't go to Wing asking for money, why should they?  I consider this an insult to all command positions and finance positions.  I have been handling all finances for the past 4 years, every since I began this squadron (without Wing help, I might add), so why am I all of a sudden incapable?

[BlackKnight]

...

[capchiro]

Phil's right about this.  Our best grant donator requests that we ask for the grant in writing stating what we will use the money for, who is managing the money in the local community and that the money must be used in the local community to help the cadets in our squadron.  There are too many local needs for our community to be supporting Wing.  JMHO

[mawr]

This is coming and I don't think we can stop it. 

My theory is that NHQ is very pleased with the book keeping by Wings using the Quick Books Pro via the online server.  NHQ can look at each Wing's books anytime they wish without having to travel to that Wing.

I believe that NHQ wishes to expand this to the Squadrons but I imagine the license fee multiplied times the number of squadrons would be a very high dollar amount indeed.

By requiring each Wing to be responsible for it's squadron's finances would lead to the need for only the 53 (52 wings and NHQ) licenses which is already being funded.

Though I am very much in favor of unit autonomy, I do see advantages, some of which are mentioned above.  In the end, any unit assets belongs to the Wing and ultimately Corporate CAP anyway so the feeling that "Hey, that's our money" is misplaced.  If you are keeping clean books then you should not be afraid of the oversight, right?

But I agree, there will be red tape and delays and this will ultimately lead to a reduction of fund raising activities.  I also believe that this too, will be another brick in the wall being built up between units and Wing's.

We have enough problems with retention as it is.

[lordmonar]

90% of the funding for my squadron comes from taxpayer dollars given by the local county government for services rendered (mostly ES and cadet program related). The remaining funding consists of grants ($500 or more each) from private organizations who support youth and community services.  We request these grants annually in writing, explaining specifically what we intend to do with this funding and who's responsible for managing it.  We simply don't have the legal authority to transfer control of these taxpayer funds to a 3rd party (the wing bank) to be managed by an entity who isn't part of the original grant contract. People go to jail for pulling stunts like that with taxpayer dollars.  We'd have to go back to our benefactors and revise the grant contract. Once the county commissioners and our local supporters get wind of this deal, 100% of our funding will dry up- instantly.  Most folks around here already have a big sore spot from having to send all their state tax money to Atlanta for little in return. They're not going to risk hard-earned grant money and local taxpayer dollars on a similar charade.

Well first....if you look at CAP regs....squadron money is national's money.  If your unit folds the money does not get divided among the survivors but is sent up the chain of command.  In theory.....national/region/wing could order your unit to disband and take those monies.

  Second...from what I understand...it is still your money....it is just in the wing's bank account.  This issue seems to have come up because there is no way for wing and national to account and audit all the sub account that they are required to do by federal law.

Again....it is your money....if you put in $10,000 from local fundraising....you will get to take out that same money....it will not be going to some other squadron, up to regional or national or be used for some wing event.  It will just be held for you in a single depository.

My problem is....it will slow down the process needed to run your squadron.  Waiting for wing to cut you a check to reimburse a member, or pay for some gas, or buy supplies when it used to take just a few minutes will be frustrating.

Secondly...again from what I read of the regulations Debit Cards are not allowed anyway because they don't have the two signature requirements.

An easy fix would be to remove the two signature requirement....this was supposed to protect us against a single CAP member embezzling the funds....now that they are all controlled at the wing level.  It would be better controlled and audited.

[mikeylikey]

90% of the funding for my squadron comes from taxpayer dollars given by the local county government for services rendered (mostly ES and cadet program related). The remaining funding consists of grants ($500 or more each) from private organizations who support youth and community services.  We request these grants annually in writing, explaining specifically what we intend to do with this funding and who's responsible for managing it.  We simply don't have the legal authority to transfer control of these taxpayer funds to a 3rd party (the wing bank) to be managed by an entity who isn't part of the original grant contract. People go to jail for pulling stunts like that with taxpayer dollars.  We'd have to go back to our benefactors and revise the grant contract. Once the county commissioners and our local supporters get wind of this deal, 100% of our funding will dry up- instantly.  Most folks around here already have a big sore spot from having to send all their state tax money to Atlanta for little in return. They're not going to risk hard-earned grant money and local taxpayer dollars on a similar charade.

Well first....if you look at CAP regs....squadron money is nationals money.  If your unit folds the money does not get divided among the survivors but is sent up the chain of command.  In theory.....national/region/wing could order your unit to disband and take those monies.

  Second...from what I understand...it is still your money....it is just in the wing's bank account.  This issue seems to have come up because there is no way for wing and national to account and audit all the sub account that they are required to do by federal law.

Again....it is your money....if you put in $10,000 from local fundraising....you will get to take out that same money....it will not be going to some other squadron, up to regional or national or be used for some wing event.  It will just be held for you in a single depository.

My problem is....it will slow down the process needed to run your squadron.  Waiting for wing to cut you a check to reimburse a member, or pay for some gas, or buy supplies when it used to take just a few minutes will be frustrating.

Secondly...again from what I read of the regulations Debit Cards are not allowed anyway because they don't have the two signature requirements.

An easy fix would be to remove the two signature requirement....this was supposed to protect us against a single CAP member embezzling the funds....now that they are all controlled at the wing level.  It would be better controlled and audited.

Agree one-hundred percent! 
Perhaps this move is being made because there are some squadrons out there who can't even follow the simple guidelines we have now!  Seriously, the turn around for a check Can be 1 or 2 days if it had to be.  What could possibly be so time critical that you would need to buy something immediately. 

My biggest problem are SQD Commanders who forget that ALL purchases have to be discussed by the SQD Finance commite and voted on.  I routinely observe many Sqd Commanders purchase CRAP on the spur-of the moment basis.  Now if you truly want something equipment based, it better be authorized as an approved item or guess what, Wing says NO.  Also, since the money is going to Wing to pay for a cadets Encampment costs, whats the big deal?  You say "Wing, cadet "so and so" is going to Encampment, please transfer the money appropriately.

Most of the excuses that have been and will be presented as opposition to the "plan" are ridiculous!

[capchiro]

It is my understanding that this is all coming about because an Air Force audit revealed that $7,000,000.00 was unaccountable.  It is also my understanding that individual squadrons were not audited, only Wings.  Therefore if the Wings can lose $7,000,000.00, why not punish the functional squadrons and give the Wings more money to lose?  Is this typical of government/military thinking?  And seriously, turn around on a check can be 1-2 days..get real.  Wing can and does routinely lose everything from promotions to Unit Citations requests.  Now all of a sudden they are going to be Mr. Efficiency.  This is about as good an idea as Vanguard was/is.  This is going to increase the bookkeeping and paperwork at both Wing and squadron levels by an immense amount.  Each squadron already has between 80-90 annual reports to Wing and National.  Please, do we have the time and personnel for this?  JMHO

[lordmonar]

It is my understanding that this is all coming about because an Air Force audit revealed that $7,000,000.00 was unaccountable.  It is also my understanding that individual squadrons were not audited, only Wings.  Therefore if the Wings can lose $7,000,000.00, why not punish the functional squadrons and give the Wings more money to lose?  Is this typical of government/military thinking?  And seriously, turn around on a check can be 1-2 days..get real.  Wing can and does routinely lose everything from promotions to Unit Citations requests.  Now all of a sudden they are going to be Mr. Efficiency.  This is about as good an idea as Vanguard was/is.  This is going to increase the bookkeeping and paperwork at both Wing and squadron levels by an immense amount.  Each squadron already has between 80-90 annual reports to Wing and National.  Please, do we have the time and personnel for this?  JMHO

No...the wing should have been auditing the squadrons all along...but it is very difficult to do so given the distances involved and simply the number of squadrons.  NHQ as a corporation has a legal requirement to audit all of its functions all the way down to the squadron level.

Yes this may have happened because CAP lost $7M, but that investigation only showed that wings were not/could not audit all of its subordinate units.   

Evidently VAWG came up with a method to do that....they would keep the books.

You have to remember deep down in the bottom of the regulations...every penny raised by any squadron belongs to the corporation and not the individual units.

[ZigZag911]

 

My biggest problem are SQD Commanders who forget that ALL purchases have to be discussed by the SQD Finance commite and voted on. 

[/quote]

Actually, group and squadron commanders can authorize expenditures up to $200 without finance committee approval.

[SarDragon]

Both the units I have belonged to here in CAWG have been audited every year. It's done by the folks in Group, so it's not a huge burden WRT to the driving.

[NIN]

Keep in mind, too, that the supposed reason behind this is so that Civil Air Patrol can obtain an "unqualified" audit opinion each year.   A "qualified" audit means that there is either uncertainty or disagreement in the overall audit process.  My guess is that CAP's audit is qualified since unit level funds are usually not fully accounted for by the time the annual audit comes around.  (late finance reports, anybody?)

Now, regions & wings are under tighter control yet we still have a qualified audit opinion since the 700+ squadrons (did I just say 700+ squadrons?) hold "corporate funds that are not accounted for under the audit."  Ever read a non-profit audit? Ever read our audit? It doesn't include squadron funds at all.

So now, unit funds would be tracked and maintained by wing.  So now units will no longer hold "unaccounted for funds" and our audit opinion would include those funds and no longer be "qualified."

(I KNEW that Finance for Managers class would come in handy. I can even spell GAAP...)

BTW, Colonel, I think that under CAPR 173-1, a debit card is probably a no-no. IIRC, a few years back a squadron in FL wing got burned for that (following a SWAT team demo that apparently didn't sit well with some folks. The IG then dug around and found something they could make stick).  My bet is that it violates both the intent and spirit of the "two signature" rule.

EDIT: I just went back in and examined 173-1 (it has been almost 2 years since I last commanded a squadron. My memory is really good, but I wanted to be sure), and it specifically states "All unit expenditures will be by check" in two places.  A debit card is a definite no-no. 

[arajca]

According to the COWG/cc, they're planning to have two check runs weekly in CO, so that should handle that protest. The plan, at least for now, is to have one account for the wing and each squadron has a portion of that account based on how much they had at the start and have raised since, which would be that smae amount they would have if they were still maintaining their own bank account. By pooling the money, the account can generate more interest which will be divided amoung the units according the percentage of the pool they 'own'. Each unit will have deposit slips so they can deposit money in their local branch without having to send it to wing.

One benefit to the wing is those units who owe wing money will have it taken straight out of their account. Currently, in CO, some units owe wing a substancial amount of money and have refused to pay it.

[Eclipse]

One benefit to the wing is those units who owe wing money will have it taken straight out of their account. Currently, in CO, some units owe wing a substantial amount of money and have refused to pay it.

Negative, and exactly what we are all concerned about - the only people authorized to dispense unit funds, are the unit commander and HIS designees.  Wing would / should not have god-like authority to simply decide a unit owes it money.

That wing staff believes it should be anything but a transparent banker is precisely the problem with this entire plan.

And to the issue of interest - its probably a better idea to simply forgo the idea of any kind of division of the money and let Wing keep it.

Just how, exactly, are you going to figure out who gets what?

In ILWG, the three major encampments are responsible for more money than the entire Wing budget, but it is "bursty" money, meaning it is in fast and spent fast - so in terms of pure percentage, those events would get ALL the interest.

Banks have entire departments devoted to calculating interest, do you think one overworked FM is going to be able to make everyone happy?

And how, precisely, do we intend to KEEP the Wing FM’s?  Or even the unit FM’s?
Finance is a huge PITA right now, and that’s without an additional layer of burecracy at the Wing level.

One of the factors that was noted in the retention issues was that “people don’t want to do their day jobs in CAP…”. So going after accountant-types isn’t going to work.

And don’t look to the Wing Administrators to do this work, as many wings seem to think, including ILWG.  The wing admins are simply administrative >assistants< to the Wing Commander and staff.  They have ZEE-RO authority, and in most cases aren’t even members.  They can’t write checks, dispense funds, or approve ANYTHING.  All they can do is type the forms and put them on someone’s desk.

We’re doing that today and still can’t get things done.