 DG Michael Moore convened a meeting of local Rotarians to discuss D9705 finances. After nearly 2 years of agitation by our own David Pyke the new Board has seen fit to reduce the balance in its Reserve A/c by reducing the Club Levy by a total $30,000 for each of the RYs 2020-21 and 2021-22. It is understood that this will be apportioned to all D9705 Clubs.
In the beginning we suggested a refund of $30,000 for D9700 to settle the matter as the two old Districts transitioned to the new D9705. The old D9700 had made a significantly greater contribution of surpluses to the Reserves. Both former Districts had also been required to make significant financial contributions to assist with the transition to the new District. There are a number of new District accounts including General and Reserve. What really matters is the total sum apart from specific project allocations. The detail is significantly more complicated, as presented by the well qualified District Treasurer Rosemary Everett.
One important question was raised at the meeting. Why does D9705 need cash reserves at all since it is largely an administrative entity which shouldn't run its own service projects? The answers were further food for thought : - potential for disasters like drought and bushfires; - potential requests for District Grants; - potential for poor business decisions by Clubs; and, - RI expect Districts to maintain a certain level of Reserves. There was acknowledgement that Districts shouldn't hold excessive Reserves. The minimum appears to be 50% of the yearly expenditure as reflected in the new District Constitution. The guiding principle for us is that any District surpluses should go back to the Clubs as a general rule since that is where most of the funding comes from. Morally surpluses shouldn't be hoarded and Budgets should be reasonably balanced. This applies to our own accounts - Club (funded by the members) and Service (funded by the community). This should be the end of the matter now. Well done David for keeping on top of things. Stay well fellows. James |
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