Details are coming to light about the Trent Central Student Association’s decision last spring to eliminate the executive position of Vice-President of Finance. At the union’s September 23 board meeting, the first scheduled meeting of this academic year, documents were presented by the union’s executive that detail instances of financial mismanagement and error that eventually led the board to chop the position in advance of its March 2012 elections.
At the time, little was known of the decision by the wider student body and according to TCSA President Brea Hutchinson, the union is addressing this issue now, as it wants to demonstrate openness and accountability in its decisions.
The September 23 board meeting saw Hutchinson table her Report on the 2011-2012 Operating Budget and New Financial Accountability Measures of the TCSA, which was compiled over the summer at the request of the union’s Summer Committee. It was commissioned as a result of the discovery of serious issues with the operating budget of the association during 2011-2012 term.
According to the report, the term saw frequent incidents of financial mismanagement that were part of a larger pattern of directorial incompetence and systemic failure. Instances of mismanagement ranged from the relatively minor mistakes of improperly tracking budget lines and payments to “enormous errors” such as quadruple billing the Trent International Program Office, entering “imaginary revenue” into the actuals and depositing an $807,000 Transit Levy cheque in a wrong account.
Hutchinson’s report explains that the widespread nature of these financial errors led to a misconception within the union “that [there was] an extra $32,000 in revenue” which prompted subsequent budgetary drafts to “greatly increased spending.” It was not until after the books had been closed for the year that it was discovered that the $32,000 in fact the result of errors in bookkeeping, leaving the TCSA with a $10,500 deficit.
In regards to determining responsibility for the errors, the report highlights the fact that the basic checks-and-balances of the TCSA’s financial process failed to prevent these mistakes. Those processes included the association’s Finance Committee, which was “tasked with the review of the operating budget,” the TCSA President who was “responsible for ensuring the work of the Finance Committee and VP of Finance was accurate,” and the Board of Directors, who ultimately approved the budget.
Speaking in an interview earlier this month, Hutchinson also noted that much of the blame lies at the feet of last year’s Vice-President Finance, Aladdin Hasmani, whose position was “ultimately responsible” for the financial accountability of the TCSA during the 2011-2012 term.
Mr. Hasmani has already been the subject of controversy this year, as he was forced to resign from his position as Vice-President Campus Life after an impeachment motion was brought to the Board of Directors during a September 9 emergency meeting.
Although Hutchinson confirmed that there were indeed issues with Mr. Hasmani’s conduct as Vice-President Finance, she also noted that there has been a systemic issue with the position of Vice-President Finance itself, having to do with the nature of the position as a one-year, elected position—students who occupied the position often did not receive adequate training in bookkeeping to appropriately manage the finances of a million dollar budget.
As a result of the Board’s decision to cut the position of Vice President Finance, the organization has opted to hire a certified bookkeeper to manage its day-to-day accounting. Furthermore, the remaining fiscal responsibility has been shifted to the portfolios of the Operations Manager and the President, a move the report calls “the professionalizing” of the association’s the financial accountability. “The Operations Manager [as a staff position] has the ability to be trained to a high degree on accounting software,” it argues, “[while] the President, being full time throughout the year, is better able to understand the processes of the Association.”
In addition, the TCSA has also introduced other measures it hopes will “increase [its] accountability, transparency, and financial accuracy.” Those measures include the development of training materials and resources for committee and board members, the “bi-monthly production of up-to-date actuals,” tightened regulations surrounding expenditure sign-offs, and the formalized training of the Executive on the financial aspects of the association.
For her part, Hutchinson acknowledged that the union recognizes the seriousness of last year’s issues and has moved quickly to ensure a structural change in the accounting practices so that these kinds of problems do not occur again. “We are being up front about these problems,” she said “and we are working to provide a long-term solution.”
Note: An attempt was made to contact former Vice-President Finance Aladdin Hasmani for comment. Unfortunately he did not respond by the publication deadline.