10-39 Budgeting: Not-for-Profit (NFP) Context (contributed by Helen M. Savage) C

Question

10-39 Budgeting: Not-for-Profit (NFP) Context (contributed by Helen M. Savage) Catholic Charities Regional Agency serves several contiguous counties in Ohio. The finance committee of its board of directors monitors financial activity for the agency. This oversight includes decisions regarding the investment of excess funds and the management of endowment funds. These decisions are relevant to the annual budget preparation since the investment accounts serve as a source of needed funds and/or a use of excess funds. As a Catholic Charities agency, the regional organization must adhere to guidelines adopted by the U.S. Council of Catholic Bishops. Visit the council's website at www.usccb.org/finance/srig.htm and review its Socially Responsible Investment Guidelines, which discuss basic principles for investments and the stated investment policy of the organization. Required What is the meaning of the word stewardship? Should the religious or philosophical position of an organization affect decisions that are made as part of the budgeting process? How should a board of directors for this organization apply these principles in making investment decisions tied to the annual budget? Would you, as a board member, ignore such principles to increase investment gains? Why or why not? If the agency's monies are managed by an investment firm, should the board request information about the stocks included in individual investment funds to verify compliance with the stated investment policy of the organization?

Explanation / Answer

1)A)Stewardship was originally made up of the tasks of a domestic steward, from sti (house, hall) and weard, (ward, guard, guardian, keeper).Stewardship in the beginning referred to the household servant’s duties for bringing food and drink to the castle’s dining hall. Stewardship responsibilities were eventually expanded to include everything the domestic, service and management needs of the entire household.AS a catholic charities agency,the regional organization must adhere to gudelines adopted by the u.s council of catholic bishops.

2A)the finance committee of its board of directors monitors financial activity for the agency.this includes decisions are relevent to annual budget preparation since the investment accounts serve as a source of needed funds and are a use of excess funds.

3A)AS a catholic charities agency,the regional organization must adhere to gudelines adopted by the u.s council of catholic bishops.so the review its socially responsible investment guidelines,which discuss basic principals for investments and the stated investment policy of the organization.

4A)catholic charities agency,the regional organization must adhere to gudelines adopted by the u.s council of catholic bishops.so the review its socially responsible investment guidelines.

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