601: NMLA Fiscal Policies
All units of NMLA are responsible for achieving the association’s financial goals. The Association shall follow generally accepted accounting principles in formulating and managing the association budget. Officers/unit heads must understand the principles under which budget management operates. All unit heads are accountable for ensuring that the financial and other resources within their control are effectively utilized and managed, and are committed only for Board approved purposes and in Board approved amounts.
1.1 The NMLA budget and any subsequent adjustments must be approved by a majority of the voting members of the Board.
1 .2 Any contract that obligates the NMLA association in any manner must be reviewed for both legal and financial impact prior to being presented to the Board for approval.
1 .3 The NMLA Board shall be given timely financial information in a format that will facilitate Board decision making on budget matters.
Unit budget proposals shall be tied to the strategic plan. Units with multiple objectives and projects should prioritize them in their budget proposals. NMLA units will receive annual budgets based upon NMLA’s anticipated income, financial goals, unit budget submissions, and the relationship of unit proposals to core NMLA activity.
3. Balanced budget:
NMLA shall run a balanced budget each fiscal year. Expenditures will not exceed income. Reserve funds are not routinely available to enhance income.
4. Budget adjustments:
The Board may change the budget during the year, including the reduction of authorized but unspent funds in a line-item. Amounts encumbered (already legally owed) shall not be reduced. Units anticipating increased income together with increased costs shall have a Budget Adjustment Request approved by the Board prior to incurring the increased costs.
All NMLA units and members are encouraged to raise funds for the enhancement of NMLA goals and strategic plans. Income received by NMLA shall go into the general NMLA funds, unless specifically earmarked by donation, grant or contract. Only in special circumstances approved by the Board, will NMLA units retain income generated by their activities. However, the Board will consider proposed income as a factor in determining the budget for an individual unit.
5.1 Membership dues will be reevaluated on a regular basis to ensure that membership dues are aligned with the Associations’ goals, and financial needs.
6. Conference income:
The Annual Conference shall be organized and planned in such a way as to be an excellent program and to generate enough revenue to meet the association’s financial goals. Unnecessary costs shall be contained as much as possible.
6.1 The mini conference shall be organized and planned in such a way as to be an excellent program and to generate enough revenue for the association to cover the cost of the conference. Unnecessary costs shall be contained as much as possible.
7. Cash flow:
The association shall manage the budget in such a way as to ensure sufficient cash reserves are readily available to pay monthly expenses. If reserves are used to maintain timely payments, then those reserves shall be reimbursed within the same fiscal year as income is generated.
7.1 Reserves shall be invested in a conservative manner as approved by the Executive Board, after consultation with the Finance Committee.
8. “In Trust” and Restricted income or funds:
When NMLA undertakes to receive monies dedicated to a specific purpose, whether by donation, grant or otherwise, then NMLA shall spend those monies first, prior to spending any general NMLA funds for that purpose.
8.1 NMLA units are encouraged to raise funds for the achievement of specific NMLA goals.
8.2 All such “in trust” or restricted funds shall be separately accounted for in the budget, and not considered part of the general NMLA income, funds or reserves.
8.3 The expenditures of in-trust funds are restricted to the purpose of those funds. Appropriate documentation of expenditures will be required.
8.4 NMLA General funds shall not be appropriated to “match” or enhance the purpose of the restricted fund without a separate action by the voting members of the Board, which is recorded in the minutes.
8.5 Restricted funds shall be maintained or invested in a conservative manner in keeping with the purpose of the specific fund.
9. Overspending by an NMLA unit:
If a unit of NMLA spends more than the authorized budget for that unit, and seeks reimbursement therefore, or has legally committed NMLA to such expense, NMLA may be justified in charging such excess amounts to the individual who authorized them without additional Board approval, unless subsequent Board approval is obtained.
10. Unspent annual budgets:
If a unit of NMLA fails to spend, or encumber, the full amount of its budget allocation, then any unspent and unencumbered amounts at the end of the fiscal year shall revert to NMLA, and there shall be no budget carry-forwards.
11. Multiple year budget exceptions:
The NMLA Board may budget funds in a current year’s budget for spending over a multi-year period. Such funds shall go into a special fund for the specified purpose and shall revert to the NMLA general
fund at the end of the specified period.
12. End of the year liabilities:
If a NMLA unit has outstanding liabilities at the end of the fiscal year, and those liabilities are less than the unspent budget for that unit for that year, then those amounts shall remain liabilities against that former budget, not the new one.
13. All other budget and financial policies/procedures in the association hand book would still apply in addition to these policies.