We continually receive calls from Treasurers and members of a Finance, Audit or similar Committees concerning; “What” reports should the Board receive and “How” should the information be presented.  Our response is two fold, namely:

• provide meaningful data to the Board that is concise, complete and timely. 

• maintain the integrity of the reporting system to provide a complete and comprehensive analysis for the management and officers of the Club. 

Meaningful Board Data

-General Manager-

-Executive Summary-

        This report is designed using an Excel Worksheet to provide the General Manager with a tool to present the highlights to the Board of Directors for the current reporting period.  The report is divided into results of operations, statistics and trends, expenditures on capital improvements and cash flow results.  The use of an Excel file allows the General Manager to modify quickly the information based on data that might need to be reported this month and yet may be dropped in later months as new information is recorded.

Executive Summary

 -What Cash was Received and How We Spent the Cash- 

        We suggest you condense and reformat the conventional three-tiered Cash Flow Report that identifies cash from operations, from investments, and from financing to highlight the cash provided or used by the Operating and Capital Program. The board only needs to see for the Operating Program the result of non-cash charges from such items as depreciation and the change in the current accounts to arrive at the increase or decrease in cash from operations. The Capital Program section should show the source of cash (the initiation fees, capital assessments, certificate or bond activity and loans or capital leases) and the uses of such cash (the expenditures on improvements or asset purchases) to arrive at the increase or decrease in cash from capital programs. Coupled with the club’s capital improvement plan, rarely seen at most clubs, this section of the report allows the club to properly fund critical projects and evaluate the future needs based on the cash available. There should be a comparison to budget, a column to identify the activity for the current period, and segments specifying responsibility by committee. 

Cash Flow Exhibit I

-How We Operate and What funds are Available for Capital Items- 

        A summary Statement of Activities can be presented in five reporting levels of responsibility. The top or first level should deal with those direct operations (food and beverage, golf shop) that the club’s management controls and the contribution of these activities to overall club operations. The second level identifies the major sources of revenue controlled through Board action including dues, fees, program revenue and investment income. The third level lists each major committees functional expenses (rather than by natural account classification). These initial three reporting levels when combined provide for the results of operations before and after depreciation.  The fourth level presents the source of capital items such as initiation fees, capital assessments. The fifth level highlights operations through the use of key item statistics that are helpful in evaluating the operations. There should be a comparison to budget, a column to identify the activity for the current period, and segments specifying responsibility by committee. 

Statement of Activities Exhibit II

-What We Own, What We Owe and What is Our Net Worth-  

The financial position of the club is expressed as the assets and liabilities. In layman’s terms, it is a snapshot, taken on a given day, of what the club owns, what it owes, and what is it’s net worth. This statement should be condensed and highlight those accounts that vary significantly for the same period in the prior year and the end of last years. This is particularly helpful. in providing the Board with a bench mark of the amount currently compared to the ending balance of the previous year. 

Statement of Financial Position Exhibit V

Maintain Integrity 

You can guide the Board in developing a policy or in following a plan by periodically illustrating key indicators or trends. For example, this could deal with the calculation of balance sheet ratios such as the current ratio, ratio of property and equipment to debt and the portion of current liabilities to annual dues. This latter ratio identifies the amount per dollar of dues required to cover current liabilities if there was a financial crises at the club. Other indicators may be membership trends by category, regular and overtime hours worked, number of meals served, no rounds of golf. Again, care should be taken to limit this phase of the reporting process to one concise page.  

            The actual issuance of complete and detailed financial statements by department, cost center and area of responsibility must not be overlooked. The Controller/Business Manger should daily, weekly and monthly provide management with substantial detailed reports as tools for monitoring the operations and maintaining control over revenues received and cost incurred. 

See Exhibits in Excel 

Note: Further reference to board reporting contact National Club Association, Washington, D.C.