CAP Audited Financial Statement FY 2010 Now Available

[RADIOMAN015]

Check it out at:  http://www.capmembers.com/media/cms/Financial_Report_2010_LowRes_C911D953E9717.pdf

Some questions/comments:
1.  Membership gains 4.4% (7.1% decade), is this "active" members or patron and other groups
2. Appears that the AF style uniforms are in the vast majority of pictures throughout the statement/narrative.  However, I did see a few golf shirts in use :clap:   I didn't see any blue utility uniforms (flight or ground)
3. Most BOG members that are "civilians" have pictures taken in civilian business attire versus CAP uniform.
4.  I like the vehicle CAP wrap art on the SUV vehicle shown.  Wonder how many SUV's we have in the inventory, and the picture shows little kids in the school program versus ES.
5.  The narrative prior to the financial statements is well organized and well presented.
6.   The Statement of Functional Expenses fails to carry the expense categories to the next page, so one would have to print out the those two pages in order to review.
7.   Noted was the "in kind" support provided by the AF as income & expense (in & out), however perhaps a footnote or table should be provided as to the total number of units support by this "in kind" support.
8.  A footnote or pie chart should be developed that adequately shows that units below the wing level are pretty much sell supporting for administration, computer access, etc.  This percentage of total revenue/expense should be noted.
9.  There still needs to be a method established on how to account for member "in kind" donations (e.g. office supplies, vehicle gas, etc) so that overall expense at the unit level is captured. (see #7 above).  Also in the foot note it mentions that significant estimates were utilized for in kind support and also allocation of expenses to various functions.   Any unit that isn't incurring "typical" expenses during the analysis phase needs to be asked why.   
10. The foot note on cash, leads to more questions rather than answers e.g. $319.4K designated for other activities (why not list those activities) versus the other two which are less dollar amounts.

This is just my initially look at the narrative, financial statements, & financial statement notes.  Perhaps others will see other positives & negatives.
RM 
   

[jimmydeanno]

3. Most BOG members that are "civilians" have pictures taken in civilian business attire versus CAP uniform.

Because the BoG members aren't necessarily CAP members, much like many of our NHQ personnel.  Just because you do work for the organization, doesn't mean that you are a dues-paying member.

10. The foot note on cash, leads to more questions rather than answers e.g. $319.4K designated for other activities (why not list those activities) versus the other two which are less dollar amounts.

It might be that there is 40 "other activities" in that amount, whereas the other 2 are single line items.  Listing 40 things is harder in a small space.
[/quote]

[Ned]

RM,

Never assume there is some sort of Deep Thinking or conspiracy involved in the creation of CAP documents when more prosaic explanations are more likely.

There was no "uniform diversity mandate" for the photographs.  Our hardworking professionals at NHQ simply chose the best photos they could find to illustrate a financial report.  A thankless and difficult task at best, no reason to make it harder by specifying that the photos must illustrate all possible CAP uniforms.  (BTW, you missed a couple of blazer uniform shots, including Gen Courter.)

For example, the BoG photographs are simply a collection of official headshots, some of which are pretty old.  There is only one BoG member currently on AD, Maj Gen Dean.  Rather than spend dues money to get a studio sitting in civies, some of the retired AF officers simply asked that we use their last official AF photos.  Others had head shots used for their business or personal use.  The rest of us were just lined up against the wall at the December BoG meeting at NHQ.  The BoG meetings are conducted in business attire, so Gens Anderson, Carr, and I happened to be in suits.


Thank you for carefully reviewing our financial report.  I hope that all  members get a chance to do so.  This is just part of the increased transparency and openness on the part of your governance.

Thank you for your service.

Ned Lee
Member at Large
BoG

[Eclipse]

I can't be the only person who is tired of this nit picky nonsense ascribed to every action by NHQ (or anyone else).

I'll argue the nuance of "shall" vs. " should" over coffee until they close the store, but not everything is a conspiracy or well-thought
out plan to take over the world.



NARF!

[RADIOMAN015]

RM,

Never assume there is some sort of Deep Thinking or conspiracy involved in the creation of CAP documents when more prosaic explanations are more likely.

There was no "uniform diversity mandate" for the photographs.  Our hardworking professionals at NHQ simply chose the best photos they could find to illustrate a financial report.  A thankless and difficult task at best, no reason to make it harder by specifying that the photos must illustrate all possible CAP uniforms.  (BTW, you missed a couple of blazer uniform shots, including Gen Courter.)

Thank you for carefully reviewing our financial report.  I hope that all  members get a chance to do so.  This is just part of the increased transparency and openness on the part of your governance.

Thank you for your service.

Ned Lee
Member at Large
BoG

I really hope there would be no misunderstanding, which there apparently is.  I'm definitely not trying to say there's any conspiracy on anything

Interestingly locally we have a good relationship with one editor of a local newspaper, and in a visit to the squadron, as the PAO I asked for her advice on photos.  She recommends that pictures be planned/posed rather than random  shots, because it's too difficult in most instances to get the right one to publish with what you want to achieve with the written newspaper article. (Personally I do think one can get some good action shots that don't have to be posed).  That's from someone with 30 years in the newspaper/magazine business.   My only comment would be since this now replaces the annual report perhaps it might be a goal to show all our uniforms, even if it involves some last minute request for posing photos from some wings.  Remember that most of these pictures have actually either been in "CAP Volunteer" magazine OR the CAP "Volunteer Now" website.

Regarding the financial statements, a big challenge with non profits is to directly allocate expense to various programs rather than management/general category, since potential donors will look at this % as well as it's relationship to total revenue/donations.  CAP is different in the respect that the USAF has a lot to say about the operation and this would dictate staffing and expense in some areas (and that is mentioned in the footnotes).

Additionally, I wondering how difficult it would be  to mandate that squadrons prepare a report similar to this for the closed fiscal year, also be published for the members of that specific unit to have access to   (If I remember correctly the unit finance officer basically has to input everything into quick books and this matches what the wing has for the unit, except for intra organization eliminations), wouldn't that add considerably to transparency???       

Ned, I'd like to thank you for your service...

Surely there will be difference of opinions BUT that doesn't necessarily mean that individual(s) aren't dedicated to the Civil Air Patrol.             

RM

[Spaceman3750]

RM,

Never assume there is some sort of Deep Thinking or conspiracy involved in the creation of CAP documents when more prosaic explanations are more likely.

There was no "uniform diversity mandate" for the photographs.  Our hardworking professionals at NHQ simply chose the best photos they could find to illustrate a financial report.  A thankless and difficult task at best, no reason to make it harder by specifying that the photos must illustrate all possible CAP uniforms.  (BTW, you missed a couple of blazer uniform shots, including Gen Courter.)

Thank you for carefully reviewing our financial report.  I hope that all  members get a chance to do so.  This is just part of the increased transparency and openness on the part of your governance.

Thank you for your service.

Ned Lee
Member at Large
BoG

I really hope there would be no misunderstanding, which there apparently is.  I'm definitely not trying to say there's any conspiracy on anything

Interestingly locally we have a good relationship with one editor of a local newspaper, and in a visit to the squadron, as the PAO I asked for her advice on photos.  She recommends that pictures be planned/posed rather than random  shots, because it's too difficult in most instances to get the right one to publish with what you want to achieve with the written newspaper article. (Personally I do think one can get some good action shots that don't have to be posed).  That's from someone with 30 years in the newspaper/magazine business.   My only comment would be since this now replaces the annual report perhaps it might be a goal to show all our uniforms, even if it involves some last minute request for posing photos from some wings.  Remember that most of these pictures have actually either been in "CAP Volunteer" magazine OR the CAP "Volunteer Now" website.

Regarding the financial statements, a big challenge with non profits is to directly allocate expense to various programs rather than management/general category, since potential donors will look at this % as well as it's relationship to total revenue/donations.  CAP is different in the respect that the USAF has a lot to say about the operation and this would dictate staffing and expense in some areas (and that is mentioned in the footnotes).

Additionally, I wondering how difficult it would be  to mandate that squadrons prepare a report similar to this for the closed fiscal year, also be published for the members of that specific unit to have access to   (If I remember correctly the unit finance officer basically has to input everything into quick books and this matches what the wing has for the unit, except for intra organization eliminations), wouldn't that add considerably to transparency???       

Ned, I'd like to thank you for your service...

Surely there will be difference of opinions BUT that doesn't necessarily mean that individual(s) aren't dedicated to the Civil Air Patrol.             

RM

RM, you seem more focused on what we we wear than what we do.

[Eclipse]

Regarding the financial statements, a big challenge with non profits is to directly allocate expense to various programs rather than management/general category, since potential donors will look at this % as well as it's relationship to total revenue/donations.  CAP is different in the respect that the USAF has a lot to say about the operation and this would dictate staffing and expense in some areas (and that is mentioned in the footnotes).

The vast majority of CAP activities are self-funded and all money goes directly to the activity, whether that is donated or member funds, so a report like this has no bearing below the national level, where anyone with the dollars to spend at that level can simply ask the person who requests it.

Additionally, I wondering how difficult it would be  to mandate that squadrons prepare a report similar to this for the closed fiscal year, also be published for the members of that specific unit to have access to   (If I remember correctly the unit finance officer basically has to input everything into quick books and this matches what the wing has for the unit, except for intra organization eliminations), wouldn't that add considerably to transparency???

Wholly unnecessary - units operate on a shoe-string, and if you can't actually see the money around you, you're not paying attention.
This issue of "transparency" is a straw man that means nothing, but is intended to raise doubts in the membership where there is no issue.

Want to know where your unit funds are going?  Ask the Finance Manager. 

[Ned]

Additionally, I wondering how difficult it would be  to mandate that squadrons prepare a report (. . . )

Actually, I've found that it is pretty easy to mandate stuff for squadrons to do in their spare time.   It certainly is cost-effective for NHQ

Heck, some would say that is the entire basis for our Safety Program.   

[RiverAux]

Why in the world would one of our goals for the annual financial report be to showcase all our uniforms?  What purpose does that serve?

[RADIOMAN015]

Additionally, I wondering how difficult it would be  to mandate that squadrons prepare a report (. . . )

Actually, I've found that it is pretty easy to mandate stuff for squadrons to do in their spare time.   It certainly is cost-effective for NHQ

Heck, some would say that is the entire basis for our Safety Program.   

Well the unit finance officers are kept busy inputting all of that information into quick books (which personally I question why that needs to be done other than to keep track of reimbursement/payment documents that is inputted into the system at wing as a cross for expenses sent to wing and cash deposits which can be done on a spread sheet or even a simple suspense file of paper documents) so it mirrors the wing (our wing basically sends a check register for our unit back to the unit for review with the unit records).  Also the full time paid National staff personnel at wing level are also reviewing the documentation, inputting this information, cutting the checks and sending them out. Seems to me this is a very easy activity to produce an income & expense report for each unit within each wing with just the simple push of a button.


BTW the system could also have unit finance officers inputting the information remotely with a batch # for all the documents being sent, which would remain not approved until the paid wing person reviewed the documents and approved, this would cut down on the inputting needed at wing.

I think sometimes the membership locally is not aware what it is costing us for everything.  In our squadron we have about $8.4K a year in operational expenses (which excludes in and out "flying club" type activities that are paid to wing for aircraft rental).  So it isn't a "shoe string" operation as some have stated.

Ned, just reminder historically when I was a cadet in the mid 1960's (and the unit maintained it's own checking account), before any computers, every month the financial report was posted on the unit bulletin board for everyone to see (income (categories), expenses (categories) & cash balance in the bank).   So what do you think happened so that we now are 'secret squirrels" as a matter of "missing national policy" on transparency at the unit level on financial reporting to the local membership
RM   

[PA Guy]

when I was a cadet in the mid 1960's (and the unit maintained it's own checking account), before any computers, every month the financial report was posted on the unit bulletin board for everyone to see (income (categories), expenses (categories) & cash balance in the bank).   

Maybe where you were but it was a far from universal practice.  I was in 3 different sqdns in 2 different wings in 2 different regions during that time and never saw a sqdn finance report.

[Eclipse]

Well the unit finance officers are kept busy inputting all of that information into quick books

There is no longer a requirement for unit FM's to maintain local records and NHQ no longer provides Intuit products for that purpose.  All unit FM's need to
do is insure that the WBP paperwork is prepared and forwarded properly and then review the monthly cash reports.  Rare is the unit that has so many transactions a month that the FM couldn't tell you the balance and status off the top of their head.

I think sometimes the membership locally is not aware what it is costing us for everything.

Most people have a pretty good idea what gas, pencils, and lunches cost, not to mention utilities.

In our squadron we have about $8.4K a year in operational expenses.

Sounds about average.  Most major activities churn more money.

There is no "mandate" to be a secret squirrel, stop insinuating this is anything more than a problem in your unit, which is
most likely following the regs, holding finance meetings, keeping minutes, and all expenses are audited by NHQ. 
If you have concern, ask them.

If you believe there is grounds for an FW&A complaint, have at and leave the rest of CAP, and all the unnecessary
reporting you want, out of it.  I have never encountered any echelon or individual FM who refused to simply tell me what the money
situation was, regardless of being a rank and file member or a commander, and before or after WBP.

[RADIOMAN015]

Regarding the financial statements, a big challenge with non profits is to directly allocate expense to various programs rather than management/general category, since potential donors will look at this % as well as it's relationship to total revenue/donations.  CAP is different in the respect that the USAF has a lot to say about the operation and this would dictate staffing and expense in some areas (and that is mentioned in the footnotes).

The vast majority of CAP activities are self-funded and all money goes directly to the activity, whether that is donated or member funds, so a report like this has no bearing below the national level, where anyone with the dollars to spend at that level can simply ask the person who requests it.

Additionally, I wondering how difficult it would be  to mandate that squadrons prepare a report similar to this for the closed fiscal year, also be published for the members of that specific unit to have access to   (If I remember correctly the unit finance officer basically has to input everything into quick books and this matches what the wing has for the unit, except for intra organization eliminations), wouldn't that add considerably to transparency???

Wholly unnecessary - units operate on a shoe-string, and if you can't actually see the money around you, you're not paying attention.
This issue of "transparency" is a straw man that means nothing, but is intended to raise doubts in the membership where there is no issue.

Want to know where your unit funds are going?  Ask the Finance Manager.

You've got me confused --- So are you saying that for some activities they remain off the CAP books completely and someone just collects money & pays for the CAP sanctioned activity

IF you are talking about someone donating such things as office supplies, don't you think that the donation should be booked as "Donations In Kind by Members" and than shown as the appropriate expense "office supplies" with appropriate allocation to the squadron's program(s) via a general journal entry??? (They are doing that for USAF contributed in kind facilities).   Would be interesting to see how those percentages change in the consolidated statements.   What's the percentage "off books" right now, is it over 10%

I would think it would be important to know what a unit actually spends in certain categories of expenses whether via donation or via the wing banker program.  Remember that the donor somewhere down the line may not be a donor anymore; also there's leadership changes, etc., so it's good to have the complete financial picture.   

Frankly these income & expense reports are just a matter of pressing a button at the unit level or at the wing level (for the individual unit) and emailing them out at the end of the fiscal year.  I would imagine that squadron, group, wing or region commanders could establish there own policy on unit specific financial information to respective members.    Again, at least in the unit I belonged to long ago, apparently it was a squadron, group, or wing policy to post financial information for that appropriate level for the membership.  I'm still puzzled as to why the leadership just wouldn't issue a policy on this for a yearly "unit local financial report" to the unit membership.   Hey even the church I'm a member of gives us an annual report of revenue & expense -- cause it's the right thing to do.   
RM             

[arajca]

At the unit I work with, finance committee meetings are typically held quarterly during a Character Development session. All the seniors who are at the meeting generally attend the Finance meeting, except for the Chaplain of course. In October, we go over the previous FY's finances.

The squadron's balance is presented at staff meetings and any time any member needs to know, the FM can provide the info within about $20 off the top of his head, or to the penny if you give him 5 minutes with outstanding bills, deposits, and reimbursements.

Another thing that I think all seniors do is absorb some simple operating costs. For example, we use generic certificate paper for some local recognition. Usually costs $5 per pack. I found it on clearance for $1 per pack. I got 5 packs, dropped them off and didn't bother with reimbursement. How do you figure that into you reports? How many pens/pencils have you contributed to the unit or cadets that you didn't bother to track?

[Ned]

I was also a cadet in the '60s. 

And then a senior at various squadrons for 30 years.

And  given the number seniors in my units, it was pretty hard to avoid being stuck on the Finance Committee, and knowing exactly what the finance situation was.  I have spent more than my fair share of time filling out various columns on a CAPF 173 and cross-checking others with a 10-key adder.

I guess my point is that for most seniors, intimate familiarity with the unit's finance is the norm, not the exception.  And as others have pointed out, what with Wing Banker and all, reports are just a keystroke away.

I commend your former unit commanders for providing transparency of the unit's accounts.  And I certainly don't mean to discourage any current unit commander from doing something similar.

But as an At Large BoG guy, one of my jobs is to talk to regular members about what we can do to improve systemically.  And you may be the first guy to ever tell me that "units need to start doing more reports."  It is a mild understatement to say that the feedback has been universal that units have far too much paperwork to do.  Particularly what members consider to be useless CYA paperwork, to tell higher headquarters things they should already know just by looking at information they already have in other formats.

And that is kinda what your suggestion feels like.  A new mandatory report to tell folks what they already know.  That kind of mandate is never going to be popular amongst commanders and staffers actually tasked with doing it.

Bottom line - if you want to take a look at your unit's finances, just ask.  Heck, if you show enough interest, I bet there is a place on the Unit Finance Committee just waiting for you.   

[peter rabbit]

I guess my point is that for most seniors, intimate familiarity with the unit's finance is the norm, not the exception.  And as others have pointed out, what with Wing Banker and all, reports are just a keystroke away.

My experience is the opposite - many senior members have no clue what their local unit or wing is taking in and spending. That information should be made available, just as units should make sure members know what they need to progress in PD and ES. It just doesn't always get done. Should we REQUIRE financial disclosure? Why not try adding a 'should' to CAPR 173-1 and see if accountability and transparency become more uniform? Thoughts, everyone? If you aren't on a finance committee, when is the last time you saw a wing and/or unit financial report and do you see an annual report for them?

[Eclipse]

If you're interested.

Just.

Ask.

[AirDX]

If you're interested.

Just.

Ask.

+1.  The last thing we need is more paper that's not ever read.

The even last-er thing would be to make me keep track of my "in kind donations".  THAT would be a way to make me quit without delay. 

[FW]

The whole purpose of the WBP is to ease the audit trail for CAP; from the squadron to NHQ. Everything trackable is done; even reported "in kind" donations.

The only reason any "in kind" donation would be tracked, in the first place, is when the donor requests a receipt for tax purposes.  If it isn't asked for, it isn't tracked.   I've learned from our Auditors, these type of donations are "insignificant" when, compared to the totality of our assets accross the nation (now over $113,000,000).

I think the appropriate statement here is: "Don't sweat the small stuff"!

[peter rabbit]

I think the appropriate statement here is: "Don't sweat the small stuff"!

I agree. Now, back to my re-worded questions:

When is the last time you saw a wing and/or unit financial report and do you normally see an annual report for them?
Are you on the finance committee for your unit?  your wing?