[huzaifa47]

BY HUZAIFA SAEED, SRA SOCIAL SCIENCES

So, as a part of my unusually massive election platform I promised regular notes/updates regarding what is going on in the MSU world. I haven't been able to do so because of a number of reasons, I have compiled a brief summary of the past few meetings as well as links to their draft minutes.

SRA 9H October 18th 2009:
Not much on note happened really. One of the shortest meetings of the year at less then an hour. It was just a long list of various committees & Services of the MSU presenting. QSCC,Mac Green, House Leader, EB, UA Committee, EA Committee and the President Vishal Tiwari informing us of his work with the Mac Health Forum as well as PACBIC (President's Advisory Committee on Inclusive Community). We also amended a few bylaws and Operation Policies.

SRA 9I November 1st:
This meeting isn't in the minutes yet, hence I won't be able to initiate a memory recall until they release the document. There was a usual assortment of reports by SHEC, SCSN, MarMor, PAC as well as a few bylaw changes.

The main point of note however was the release of auditors statements of the overall MSU finances by a professional accounting firm. As you might/might not know the MSU hasn't had an entirely good year as far as finances are concerned. They recorded a 400k deficit last March and on paper atleast there appears to be another 376,000 "accounting deficit".

There are a number of reasons for that, however this deficit was also in part due:

• The deduction of approx 375k from the Capital account for renovating Quarters Bar & Pub
• The Marmor, the McMaster yearbook you receive at the time of graduation had collected a back log of issues that needed to be published and sent out.
• Apparently, we had failed to pay the OMBUDS Office their regular annual fee for a few years and hence had to pay $140k this year.
• Undercovers (The MSU used book exchange service) didn't do all that well financially since it is based on a flawed and risky revenue system. As things stand the BOD has decided to scrap the service come next year.
• Underground Print & Media didn't do as well financially as it potentially can if they tap into & advertise their design department better (according to the view of a few knowledgeable SRA/MSU members)
• Quarters obviously recorded a 376k operating loss.
• The Silhouette had a negative expenditure over revenue outcome of $45,000
• MSU Shortstop didn't do all that well either. Part of it was because they somehow managed too lose $15,000 worth of stock in the backroom that was later found.
• The Dental Plan actually managed to have a recognized $45,000 deficit.
• In the list of negatives there still were a few positives like the Union Market, Compass, Day Care, Clubs, CFMU who managed to draw a positive revenue.

The Entire Draft Report Document can be found here.
The Vice President Finance's commentary can be found here.

On a random note the Vice President Education's bi annual report is here.

So what can be done?

Now given the bleak report, there must be concerns as to what can be done & why the financial situation at MSU is looking this bleak; I only wish I could analyze it better for you guys but I have a major weakness when it comes to finances/accounting.

The MSU has recently hired a comptroller (accountant) to look after our accounts and make sure there are no errors in that sector. However, there still are independent organizational issues present in a number of services as far as staffing, advertisement, service and management is concerned. It is understandable when we consider the fact that a number of these services are run by part time student managers and employ regular everyday students just like you. Yet there are still a few things that can be improved on at the micro level according to the view of a number older SRA and MSU members that I have been conversing with since the budget release.
One thing I brought up in the last meeting myself during question period was the issue of over staffing at 1280, Undercovers and Underground during off peak hours; however the SRA or the BOD have not much of an autonomy over the everyday running of these services, however I did get an assurance that they are aware of these issues and do their best to inform the Managers on a regular basis.

Similarly "budgeting" is an important aspect of any organizations financial structure; to the best of my knowledge the corporate charter of MSU requires a budget review to be completed before December. However due to unknown reasons the MSU hasn't had a budget review for the last 4-5 years. The VP Finance did promise a budget review during his election's platform and I have hence publicly inquired about that issue in the last two meetings. According to current schedule the SRA Finance Committee is supposed to complete a budget review by January.

I only wish that I could provide a more substantive list of solutions to our problems, however the financial scenario is an intricate result of connections between the MSU full time staff, student part time managers with various levels of competence, autonomous services, arguably flawed financial structure the Board Of Directors and every single staff member. It is unfair and difficult to figure out and point the finger on one body within this structure. However, it is our union, the students are equal owners of every single item on the MSU structure. If anyone reading this has any suggestions or anecdotal evidence on what some of the issues are, feel free to contact me and I will make sure I forward them to the SRA and Board Of Directors.


SRA 9J November 15th
Another short meeting. The usual array of reports by Maroons, Bylaws, EFRT, Services and changing an operating policy. We also held elections for MSU positions on the Services and University Affairs committee. The MSU President also presented a bi annual report and was critically questioned over his platform points and some of his work so far.

SRA 9K November 29th
There was a usual array of reports by SWHAT, Operations, Mac BreadBin, Finance Committee and Vice President Administration. We officially ratified a list of clubs for January, however there was an hour long debate during this motion on the merits of Mac Investment club; A large and well run independent club created by commerce students to pool their money together and invest in the market. On paper it seems like a great idea and learning initiative however there was an issue. The Clubs Administrator and a few members of the assembly were of the belief that since there is a possibility of making a profit, it would go against the official MSU policy against "profit making" for MSU clubs. This debate was opposed by a few other members of the SRA and the individual representative from Mac Investment club. Eventually the club was not ratified and that specific policy was sent to Services Committee for review.

There was however a distinct shift in the overall atmosphere within the SRA. In the previous few meetings there was hardly any activity from most members of the assembly during question period (a period where any SRA or MSU member is free to ask questions to any member of the assembly) or during most reports. During this question period however there were well over 20 questions and a couple of SRA members(including myself) even managed to reach our allowed questions quota. The debate turned heated around the question of MSU finances and the delay in the annual budget review as well as accessibility to Financial documents for regular everyday MSU members. While in retrospect there were both Pro's and Con's to this sudden outbreak of assembly activity, it is good to see the assembly members finally beginning to actively debate (even if it goes in circles at times).

On a sidenote our Vice President Education, Chris Martin, and External Affairs Commissioner, Aaron Wade, were at OUSA Lobby Convention in Ottawa this weekend. OUSA is a collaboration of Ontario universities for lobbying purposes. They had a positive experience meeting with and getting promises and feedback from various MP's and Government Education Ministry Officials. OUSA has a few Ambitious goals(www.OUSA.ca) as a lobbying organization, however from what he gathered the VP Ed feels as if they are doable. He will be releasing a press release on the MSU Website soon so keep an eye out for it!


As for my personal platform points. I have completed the electrionic voting research report and myself and the Chief Returning Officer will be presenting it next year at the January 10th SRA meeting.

I have been conducting further research into course registration systems at other Canadian Universities. I have touched base with economic's experimental research professors and will be starting working on the 1280 consumer preference experiment design next term when they come off their research leave.


That concludes my long due report. I apologize in advance if there are any factual inaccuracies or errors in analyzing a few situations. Please feel free to point out any mistakes!

As I mentioned before, finances are my Achilles heel, but I am doing my best to overcome that by regularly asking questions and listening to various SRA/MSU members as well as attending finance committee meetings.

If you have any questions or comments please feel free to share them and I will do my best to answer them or guide you to the right resource!

In Solidarity,

Huzaifa Saeed
SRA Social Sciences.

p.s: MSU financial statements as of October 31st 2009 can be found here http://www.mediafire.com/?tjxjzfwemdw courtesy of SRA Engineering Matt Wright. They are also somewhere on the MSU Website

p.p.s: There was subsequent discussion on a few areas of this note: I would recommend you to follow up on it here.

[macsci]

"The main point of note however was the release of auditors statements of the overall MSU finances by a professional accounting firm. As you might/might not know the MSU hasn't had an entirely good year as far as finances are concerned. They recorded a 400k deficit last March and on paper atleast there appears to be another 376,000 "accounting deficit"."

[Lois]

"Part of it was because they somehow managed to lose $15,000 worth of stock in the backroom that was later found".

;__;

[huzaifa47]

Originally Posted by Jay

"Part of it was because they somehow managed to lose $15,000 worth of stock in the backroom that was later found".

;__;

Yeah, MSU Inc has a number of structural/organizational issues that need changing. When you hand off services to student Part time managers it is not fair to expect a perfect level of financial prudence and rule following. Another example is the Maroons carrying out most of their transactions via cash at their office instead of going through(and making people pay) through the MSU accounting office. Hence if you take a look at the accounts there is a uniform "cost" of around $4,000(when the suits for WW reps are all paid from their own pockets) and a Revenue collected(from uniforms) of only $600(meaning only 10 suits appear to be recorded in the balance sheet as payments at first sight).

It's stuff like that the current administration is trying to sort out, they have also recently hired a comptroller for the first time and I heard that is helping clear issues like these out.

At this point all I can do is ask questions regarding the discrepancies and other issues from the Vp Finance. I cannot comment on or publicly discuss the performances of or actions of student PTM's or any other employee for that matter because its an HR issue; which is something I hope anyone reading this realizes before they criticize me or the SRA in general for not taking "direct" action on these issues and firing/hiring people, also the SRA according to the view of some people isn't supposed to micromanage the way our services run.

The job talking about day to day issues is supposed to be in the hands of the Execuetive Board(Which is the BOD and 4-5 Elected SRA members); they also go into closed session every meeting so I don't have access to what is being discussed in there either. But that is just my personal take on it and doesn't neccesarily constitute the offical views of all SRA members!


That being said there has been not alot of questioning about these issues by most SRA members, my theory probably is that they probably do not understand the financial documents enough to question them during question period. A cursory look at the minutes shows that only three SRA members myself, SRA Engineering Matt Wright and SRA Humanities Matt Dillon Leitch have regularly brought these structural/financial issues up alongside MSU member Rohan Nair on borrowed speaking rights.

In the January meeting SRA Engineering Matt Wright plans to bring up during question period issues with 1280, Operating fund & MUSC occupancy agreement. If anyone has any input to that you are free to contact him @ wrighm7 at mcmaster dot ca or even myself(Since I'm currently formulating a list of questions as well)

[Tailsnake]

Originally Posted by huzaifa47

That concludes my long due report. I apologize in advance if there are any factual inaccuracies or errors in analyzing a few situations.

This is an impressive breakdown of events from the meetings, this is far more insight than I or any other student likely has had into the inner workings of the SRA in some time outside of reading the tediously detailed minutes. I'd just like to thank you for making this information easily available in a concise easily readable form, hopefully if you keep this up more people will become involved with our student government.

[huzaifa47]

Originally Posted by Tailsnake

This is an impressive breakdown of events from the meetings, this is far more insight than I or any other student likely has had into the inner workings of the SRA in some time outside of reading the tediously detailed minutes. I'd just like to thank you for making this information easily available in a concise easily readable form, hopefully if you keep this up more people will become involved with our student government.

Thank you, lol I was actually suffering from a state of low self esteem as an SRA member because I still feel as if I could have achieved more in the past few months, hopefully I'll get more of my stuff done before March!

My mood isn't helped by the fact that the assembly in general is highly inactive and debate/questions seem to center around 2-4 more active SRA members vs the BOD; while the rest either don't understand what's going on or don't care if I am correctly reading their body language.

There still are SRA members(some new some old) who still haven't uttered a single word during discussion of a motion or contributed during information or discussion period. Since most SRA members got elected claiming to "represent" your rights & opinions I would suggest anyone who plans on voting in the SRA General Elections next year to take a few minutes to read in the minutes who all has been keeping up with their campaign promises.

But then again I have very liberal view points on discussion & the need for every single SRA member voting to be in a state of "perfect information" and if I had a choice I would make it compulsory for each SRA member to contribute and for SRA meetings to be 6 hours at a minimum
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*Forgot this one:

December 6th: This was a short & extra meeting called primarily to ratify the changes to the MSU constitution. The MSU constitution is the most important document for the MSU and even more important the bylaws. It hadn't been updated for a while and due to effective work by the Bylaws & Procedures committee we had a list of changes to it at this meeting. Most of the changes were stylistic and semantic but there was discussion here and there on the changes to BOD recall procedures. The most Important change from this meeting was the fact that the position of Vice President Administration is now open to all MSU members and you don't need to be elected to the SRA to run for VP Admin. Come next March anyone with experience in managing businesses or services and employees is highly recommended to run!

The other important issue was the passing of a motion that referred to the Space Audit committee the need for a Shared Prayer space on campus. The motion was passed despite a few concerns like: -The VP Admin who was formerly on Space Audit stated that there is no actual space on campus for shared prayer space and the possible venue of retail space currently occupied by Undercovers(which is most likely to close down next year) isn't appropriate for a prayer space. A concern I for example had was that we should consult and take into account the views of different religious clubs before we try and find a space like this, being a member of MSA I have a good feeling that a number of Muslim people will not be comfortable praying in a room where there are pictures/idols from other faiths and that given their large turnout at prayers they are actually looking for a bigger space then their current office at Wentworth Hall.

Neverthelessthe motion passed and the space audit committee will be looking into it next year, if anyone from any religious background has any concerns I'll be happy to take them to Space Audit.

[Infinity]

nice stuff....


how come your like the only SRA on macinsiders? should get some more people to help you out.

[Ian Finlay]

If you read the statements right, they have a HUGE surplus. Also they did not record a $400k deficit, they recorded a $40,000 one last year, and another $356,000 one this year, which does not even equal to 1 mil in the past two years combined.

[Marlowe]

For some reason I can't say Thanks to this post... but know that I tried several times 100% agreed with Tailsnake, this is a great way to get people involved.

Has anyone suggested not using student part time managers in the future? And when you say "it is not fair to expect a perfect level of financial prudence and rule following", what is it you mean?

What is the MUSC occupancy agreement?

When services like EFRT, SWHAT, etc present, what is it that they say (in general)?

Sorry for even more questions, when I already questioned a lot of this on facebook, lol.

[Alvand]

Originally Posted by A.Marlowe

What is the MUSC occupancy agreement?

When services like EFRT, SWHAT, etc present, what is it that they say (in general)?

I can answer these two.

The MUSC occupancy agreement details what the University, the MSU, third-parties (ex. tim hortons), and table vendors pay to rent space from MUSC, how the space is allocated, and who is responsible for damage on their property, among other things that I do not remember. Matt Wright sits on the Board of Management so he can answer more precisely.

When services present at SRA meetings, it's their time to give the student representatives an update of what is going on with their service. This includes information on past and future events, finances, how current operations are going, how their execs and volunteers are doing, and how the managers are running the service in general. Then, the floor is open to questions and comments from the SRA. They report to the assembly on average twice a semester, if I am correct.

For past reports from services to the assembly, check out the documents section on the MSU website here. Not all the services who have presented have documents up on the website, as these only represent the hard copies of their presentation that they have decided to write up.

Hope this helps

[deadpool]

Uhh. Let me correct a lot of incorrect information here.

Huzaifa, the Quarters expenditure was done in this fiscal year, so it's not on the statements from last year. Plus, any of the leasehold improvements made to Quarters are amortized, and so the cost is spread over ten years. In next year's audit we will see 1/10th of the amortization cost in the Twelve Eighty account, plus we will see a payment made to the construction company for labour.

As for the MSU's financial stability:

While the MSU is in no immediate danger of becoming insolvent (there is still $3.5 million dollars sitting in invested reserves and a $360,000 loss is an isolated event in the history of the MSU) the MSU is not moving towards cutting student fees.

Next year's financials won't be spectacular either due to the amount of money that would have been spent on capital resources as the MSU's technology infrastructure was repurchased due to the equipment reaching the end of its deprecation. However, there won't be giant unforseen payments like Ombuds and the Marmor.

In short, the MSU should be very close to even in terms of balance of expenditure and revenues. It will be stable in the longrun.

Where can the MSU go from here:

The obvious long-term goal of the MSU has always been to support their services with their revenue generators. The short-term goal should be to see profitability from the revenue generators so that the MSU can balance revenues and expenditures with a small student levy.

This means that Underground and Short Stop need to perform well, and bring in lots of profit. It also means that TwelvEighty needs to be much more financial stable that Quarters ever was, and it means that other money holes like Undercovers need to be eliminated.

---

To note:
Andrew, part-time student managers are in charge of services. Services are not designed to generate any revenue, and are designed to run on the operating fund in order to benefit students. Huzaifa is completely incorrect with what he said.

MSU services are, and always have been very good with spending according the budgets. Year to year statements will see minute differences in how much a PTM spends compared to their predecessors or successors.

There is no problem with student managers. Especially more so considering that they are not allowed to approve their own spending. A full-time MSU employee: the VP Finance, is the budget manager for the Services, and as such had discretion over the approval of expenditure requests from Service managers.

Full-time management is found in all the revenue generators: TwelvEighty, Underground, ShortStop, and Union Market. In addition, full time managers are also in charge of Compass, Day Care and the Silhouette.

The last thing to remember about the MSU is that every service or business has turnover atleast once a year. This means that student management changes, and there is a continuity problem within the MSU. This contributes a lot to the under-performance of some businesses where management have to spend more time training staff than working on more efficient ways to run the business. Truly efficient business are those which have full-time, experienced staff who understand the particular situation of each business.

[james2255]

Originally Posted by huzaifa47

Yeah, MSU Inc has a number of structural/organizational issues that need changing. When you hand off services to student Part time managers it is not fair to expect a perfect level of financial prudence and rule following. Another example is the Maroons carrying out most of their transactions via cash at their office instead of going through(and making people pay) through the MSU accounting office. Hence if you take a look at the accounts there is a uniform "cost" of around $4,000(when the suits for WW reps are all paid from their own pockets) and a Revenue collected(from uniforms) of only $600 (meaning only 10 suits appear to be recorded in the balance sheet as payments at first sight).

This violates the economic entity principle and is usually a first sign of poor financial/accounting controls. It is acctualy a big deal which I highlighted at the meeting when the SRA approved the statements. If you look at the auditors letter it highlights this in paragraph 3. It makes the quality of earnings / financial statements of MSU inc not fairly representative and in my opinion is indicative of more possibly more material problems.

Although I know you have said in the past that reading financial information is not your strongest point, your Maroons transaction example would be reflective in the Income statement (P&L) - not balance sheet.

It would probally be effective for the VP Finance and Comptroller to train/have a course on reading financial statements and spotting key issues for the SRA. The SRA ultimately approves the statements - but if it can't understand them, and their meaning, then there's no real oversight.

[deadpool]

No it's cool Steels. One day in the future we'll get online PO system and it'll be equivalent to the second coming and save the MSU from all peril.

I do need to add that for student managers to not be harmful to the MSU, the VP Finance needs to be on top of his game.. as

Unfortunately that doesn't seem quite the case in 2009/2010 fiscal year...

[huzaifa47]

Originally Posted by james2255

It would probally be effective for the VP Finance and Comptroller to train/have a course on reading financial statements and spotting key issues for the SRA. The SRA ultimately approves the statements - but if it can't understand them, and their meaning, then there's no real oversight.

Hmm yeah I suppose it seems like a good idea, because I still can't differentiate between income statements and balance sheets and how/where I can find for example the Maroon's Repsuit fees that appears to be a "cost" on the Balance sheet but if I infer your post correctly it should appear somewhere else as a positive on the "Income Sheet". Because from my understanding a Balance sheet is a mix of Revenues & Expenditures so it should be the final penultimate financial document(?) :S

I would definitely be willing to spend some time learning these accounts with the comptroller in January. Right now I have to harass people like Rohan with questions!

p.s: The Income statements; I'm assuming they aren't published online?