Summary of Finance Committee Meeting of 6 March 2007

Present:

            Finance Committee:  Phyllis Benaman, John Frisch, Sanya Ham, Don Horan, John Lynch, Jean Strub

            Board of Directors (BoD):  Mal Malo, Toni Brown, Chuck Heath

Contracts:  The BoD recently signed a contract with East Coast Fire Protection, Inc. (ECFP) to conduct quarterly and annual inspections of the fire warning and fire fighting equipment in the Community Center.  A proposal sent by ECFP last fall would have resulted in a contract excessively favorable to ECFP and highly disadvantageous to FRCA, and the Finance Committee recommended that the proposal not be accepted.  However, the recently signed contract is very fair to both ECFP and FRCA.  When asked the cause of this vast improvement, Mal said that it was due to the efforts of the contracting team at Armstrong Management Services.

Monitor Community Center Account:  Quickbooks Pro has been received and installed on the Activity Director’s computer.  Data for events in 2006 and earlier has been left in Quicken.  Data for events held or to be held in 2007 has been moved to Quickbooks Pro.  The plan is to let all of the pre-2007 events run their course to find out how much money is left when all of the costs of these events have been paid.  If the amount of money left is more than is needed to cover early deposits for bus rentals, hotels, etc., the excess funds will be removed and placed in the FRCA general account.

John Frisch periodically backs up the data in Quicken.  He will start backing up the data in Quickbooks Pro.  The data storage device used for this back up is not kept in the Community Center.

Monitor FRCA Account:  The interaction with Armstrong Management is still going well.  Jean Strub has been working with Sylva Southwell, Armstrong’s on-site manager, by reviewing the coding of invoices.  Jean will check with Sylva to make sure that all of the invoice coding is reviewed.  This is to be a temporary activity which will ultimately be scaled back to an occasional review of selected invoices.  Since there have been few errors in the coding of invoices, the scaling back would occur soon.  However, Armstrong Management very recently made significant modifications to the numbering of the chart of accounts prepared by the Finance Committee.  This is acceptable to us because the chart of accounts was prepared to be compatible with Koger Management’s numbering system, but the recent modifications to the chart of accounts will probably extend the period of oversight to make sure the Armstrong chart of accounts fits our needs.

Final reconciliation of the canceled Visa debit card account will await the completion of the 2006 audit.

Delivery of the 2005 audit by Goldklang, et al. is imminent.  The 2006 audit by Goldklang, et al. is underway.

Armstrong Management delivered the January 2007 financial reports on 5 March.  There was not enough time to review them thoroughly before this meeting, but a cursory review was encouraging.  The January financials only deal with activity conducted since 1 January by Armstrong Management.  There will be no tie to or comparison with 2006 figures until a good set of financial information for December 2006 is obtained from Koger Management or by the 2006 audit.  A significant number of January payments were for 2006 services and they will ultimately be charged against the 2006 budget instead of the 2007 budget.

Along with their January financial analysis, Armstrong Management's Financial Team noted that the January 2007 contribution to the Replacement Reserve was not funded.  They asked to be informed in which account these contributions should be deposited.  After discussion, the Finance Committee decided to recommend to the BoD that a new account be established to receive the Replacement Reserve funds.  This new account would have to provide easy, continuous access to our funds, pay interest at a good rate, and be covered by the FDIC.  The account should not be with CAB or Firstrust because our other accounts and CDs at these banks use up all of FDIC's $100,000 insurance coverage.  Therefore, the Finance Committee makes the following recommendation to the BoD:  The Board of Directors should direct Armstrong Management Services to open an account providing easy, continuous access and a good rate of interest in a FDIC insured bank other than CAB or Firstrust.  This account should be designated as and used solely for Replacement Reserve funds and each month's contribution to the Replacement Reserve should be routinely deposited in this account.

A copy of a bank statement for our account at Firstrust was not included with the January financial reports.  A copy will be requested from Armstrong Management.  Routine inclusion of all bank statements with the monthly financial reports will also be requested.