Financial Management
Financial Management is an important part of waka ama and generating income helps sustain the sport. The following information provides some key information on financial management and funding.
Financial Management
Financial management is managing money received or spent. Doing it well is essential to any Waka Ama Club. Financial management has three basic parts:
- Planning (on how to raise and spend money)
- Record keeping (tracking money in and out)
- Reporting
Good financial management does not rest solely on the treasurer of the club. The committee members must also have input into the financial running of the club. To make the treasurers job easier and ensure the smooth running of the club all paddlers and affiliated members must do their part and keep up to date with membership payments.
The following information will cover basic financial management areas, but it is recommended that your club talk to an accountant or someone with finance experience to get your head around the key concepts. For more info check out Community Net & Sport NZ Financial Management information on their websites:
Community Net
Sport NZ
The treasurer is a key person in the club's management. They are represented on the club's board or committee, and take overall responsibility for its financial management. It is important that the treasurer doesn’t work in isolation, all members of the committee should have input. At the very least the management committee should be involved in the developing and approving budgets, keeping to date with the financial position of the club and asking questions about the finances
A treasurer with financial experience is ideal but not essential. The treasurer will require a job description - this sets out what they're supposed to do and provides standards for their performance.
The role of the Treasurer is broad. It includes day-to-day clerical tasks, the preparation of budgets, regular reports to the management committee and annual financial statements, and the making of recommendations to the management committee on the most effective use of the Waka Ama club’s funds.
In managing your organisation's finances, you should set policies and procedures that must be followed. This will make it easier to keep track of the money that comes into the organisation and how it is spent.
Some areas to cover in your policies and procedures include:
Cash receipting:
- writing receipts for cash received such as donations, membership fees, etc.
- banking all money received (i.e. don't use it to pay for costs)
- banking cash as soon as possible after it is received.
Making payments:
- pay for all purchases and expenses (except for small, petty cash items) by cheque, directcredit, or Internet banking so there is a record of the transaction
- have a system for approving payments
- only pay a bill when an invoice has been received
- have designated cheque signatories and two signatures on every cheque (or two authorisingcodes for internet banking)
- have a system for filing invoices
- have a petty cash system for small payments with procedures to balance and reimburse it.
This is basic information you need to manage your club's finances, remember that the size of your club determines the financial management processes that need to be put in place.
Usually a computerised accounting system is the easiest and simplest way to keep track of the club's accounts. There are several simple programmes or software packages available such as Xero. If the club is small enough a manual system may be sufficient. Here's what your accounting programme should be able to do:
- calculate GST and allow you to allocate it by individual transactions
- follow spending
- produce comprehensive financial accounts (profit, loss and balance)
- allow you to make necessary adjustments easily
- provide you with the information required in an easy-to-understand report form
- provide information in a clear format that everyone using it can understand clearly.
The club will require an annual budget. This is the responsibility of the treasurer and is agreed on by the club’s committee. Once the budget is approved, it is added into your accounting system so that it can be compared to the club's actual income and expenses. You can use either an Excel spreadsheet or a manual cashbook for the club's budget.
To prepare a budget:
- start with actual income and expenditure from the previous year - if the club is new you will have to base this on realistic estimates
- add what you know about the coming year
- adjust and modify until you have a realistic and reasonable budget
- get the budget approved by your management committee or governing body
The club's financial records will be audited from time to time. During an audit, a person independent of the club (such as an accountant) checks that the financial statements are a correct record of the financial position of the club at the time of the audit. Auditing can be a lengthy process and it is a good idea to allow six to eight weeks for an audit to be completed. Your club's auditor will need:
- the club's cashbooks, written up and balanced for the year, and journals or ledgers that theclub uses for records
- bank statements for the whole year
- copies of deposit slips
- receipt books with duplicate and original copies, plus any unused receipt books
- vouchers for payments made by the club, arranged in numerical order
- receipts
- copies of minutes from your management meetings that show how financial decisions were made and agreed
- copies of any previous audit statements
- all financial statements for the year being audited
- any other relevant financial documents
Funding
Sponsorship
Sponsorship is when businesses and companies provide funds, resources, or services to a club, in return for rights and/or associations with the club. These rights or associations help the business commercially. This may take the form of a logo on a Waka, signs at an event, or free advertising in a newsletter.
Grants
Grants are funds received from statutory, voluntary, or philanthropic agencies established with the primary purpose of giving grants. They give grants to meet their own objectives and strategies, such as government policy, community development, or supporting the local community.
Fundraising
Fundraising is the process that your club undertakes to secure additional funds. Fundraising should fund special activities such as new Waka, paddles or lifejackets, special events, overseas Waka Ama trips, and new programmes or projects.
Funding Management
1. Organisation and preparation
- Nominate someone on the executive committee to be in charge of finances and funding with the support of the committee.
- Keep a finances folder within your club with all financial information (meeting minutes, letters of support, event flyers/ads, previous funding applications)
- Remember you may not always be the person applying for your clubs funding - the more organised are your records, the easier it will be for the next person to take up the task!
2. Funding requirements
- Identify suitable funders
- List the items/projects you need funding for
- Make a calendar of all closing dates
- Contact your Regional Sports Trust (RST) or local council for advice on the local funding agencies in your region
- List your resources available
- Fundraise
Many funding agencies expect you to contribute a portion of the cost towards your project. This means raising money in others ways within your group to meet this criteria, not just seeking funder contributions.
3. Application requirements
- Affiliated to the National Sports Organisation - Waka Ama NZ can provide you with a letter of affiliation on request
- Evidence of non-profit status i.e. Deed of Trust, Charities Commission or Incorporated Society Certificate
- A bank account/printed bank deposit slip in the name of your club/organisation
- A resolution/copy of the minutes stating your committee’s agreement to apply for funding, signed and certified by your executive committee
- Profile or summary of your organisation: your purpose/activity/services, your history and how long you have been established, your membership numbers, your trustees names, your future plans or goals.
- Financial documents such as:
- Bank statement
- Income and expenditure statement for the last 12 months
- Reviewed or audited Annual Accounts
- What the grant is specifically required for and the amount requested including:
- Cost breakdown (proposed budget) of your project/expenses
- Two or three competitive quotes, or written explanation if several are not available.
- Sources of other funding for this project, and what funding is already raised.
- Where do you intend to get further funding for the project (if required).
- Other supporting material such as news clippings of your intent to raise funds, letters of support from recognised groups/people, can be useful.
4. Completing your application
Each funding agency will have its own criteria and eligibility requirements so it pays to look closely at the application form before going ahead to make sure you comply. Check the closing dates for funding applications, some are monthly some are twice a year. You need to allow yourself enough time for it to be processed before your intended event/programme. Most funding is not granted for retrospective costs.
Resources
Sport NZ: Fundraising & SponsorshipCheck out the Aktive Finance & Insurance Toolkit
