Jo Ann Golden, President-Elect
G. William Hatfield, Vice President*
Kevin J. McCoy, Vice President
Frank J. Aquilino, Treasurer
Sharon Sabba Fierstein, Secretary*

Arthur Bloom
Ian M. Nelson
Stephen F. Langowski
Carol C. Lapidus
Louis Grumet, Executive Director

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02 – D – 01

The minutes of the last three Executive Committee meetings were discussed.

Ms. Newman-Limata asked if there were changes to the January 29, 2002 conference call minutes, which had been distributed with the March 5 Agenda. There being none, she declared them approved as written.

Ms. Newman-Limata asked if there were any changes to the February 12, 2002 minutes. Mr. Woehlke noted that senior staff suggested that in the President’s Report, section "b", the estimated amount the Society spent on the World Trade Center Recovery Program should be changed from $20,000 to $24,000. Ms. Newman-Limata asked that the minutes be further amended to reflect the fact that Society staff estimated this figure, not herself.

In the Executive Director’s Report, Section "a", the number of chapters desiring to publish their newsletter in The Trusted Professional was corrected from 12 to 13, to reflect the inclusion of the Rochester Chapter.

In the Report of the Finance Committee, sections "a" and "b", the applicable dates of both FAE’s and NYSSCPA’s Financial Statements should be January 31, 2002, not December 31, 2001, and all references to a seven-month period should be changed to an eight-month period. Also, in section "a", the words "from FAE" should be changed to "in the Foundation."

Ms. Newman-Limata asked if there were any objections to these suggested changes. There being none, she declared the minutes approved with the revisions.

Ms. Newman-Limata asked if there were any proposed changes to the minutes of the February 22, 2002 conference call. There being none, she declared the minutes approved as written.

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02 – D – 03

Ms. Newman-Limata asked Ms. Chambers to present the report of the Finance Committee.

Ms. Newman-Limata reminded the committee of the Board’s directive to underwrite a loss from FAE up to the extent of $300,000 and noted that the current budget reflected a deficit from FAE of $594,500.

Mr. Schmelkin noted that the Finance Committee thoroughly considered the Executive Committee’s direction in good faith before arriving at $594,500, which was significantly lower than the deficit previously discussed with the Executive Committee. He noted that the FAE Trustees felt that the ramifications of Enron’s bankruptcy, in conjunction with more targeted marketing of FAE’s conferences and seminars, strongly suggests a higher anticipated attendance rate, thus increasing anticipated revenue by 10 percent. Mr. Schmelkin added that two committees, the Government Accounting and Financial Accounting Standards Committees, would run a conference specifically tied to the issues raised by the Enron matter.

Mr. Schmelkin further stated that under the contract the Society and FAE have with E-Mind (formerly Yipinet) for online CPE, FAE is guaranteed a payment of approximately $150,000 in October 2002, the end of the current contract term. He noted that this amount has been included in FAE’s budget.

Mr. Schmelkin also said that the FAE Trustees reinstated a registration fee for attendance at committee-sponsored Evening Technical Sessions, the anticipated revenue of which was calculated to be $30,000. FAE also instituted a $25 surcharge for course walk-ins and a $25 fee for cancellations within two weeks of a course. Mr. Schmelkin indicated that these new policies are being well publicized in media, including the Society’s website and print publications.

Mr. Schmelkin noted that when taking these factors into consideration, anticipated FAE revenue is significantly more favorable than initially reported to the Executive Committee. He referred members to the newly amended budget report for a full accounting of the current projections.

A committee member asked whether FAE could realistically recapture 10 percent of the revenue as anticipated in the current budget. Ms. Chambers noted that staff had been even more optimistic regarding this figure, but the FAE Trustees were more conservative and thus held the estimate firm at 10 percent.

Mr. Schmelkin reviewed some of the trends in course attendance and revenue from prior years, pointing out that although there is not a linear progression, the FAE Trustees looked carefully at those programs that attracted the most people and revenue.

Ms. Chambers drew Executive Committee attention to several items such as staff timesheets and a savings of $25,000 on committee breakfasts, which will no longer be provided. Mr. Grumet noted that the response from committee chairs to the change in the provision of food to committees has been very positive. He indicated that several chairs volunteered to buy their committee’s refreshments out of their own pockets.

Mr. Schmelkin reported that the Society is in the process of negotiating a contract with Quality Inn Hotel, located on 46^th Street between 5^th and 6^th Avenues. The contract would provide accommodations for Society and FAE guests and leadership at a standard rate of $109 per night. Mr. Schmelkin noted that the hotel provides standard amenities, clean rooms, a safe and well-trafficked neighborhood, and is conveniently located near the Society’s offices. Mr. Grumet added that the proposed budget assumes that once the contract is finalized, lodging in the Quality Inn Hotel would be required for both Society and FAE, except on certain contracted "black-out" dates.

Ms. Chambers said that $85,000 in savings was identified in the budget when several chapters opted to produce their newsletters electronically and in The Trusted Professional, thus saving postage and printing costs.

A committee member asked how the additional staff cuts anticipated by the budget would affect the quality of services and staff morale. Mr. Grumet said that eleven positions, or roughly 10 percent of the staff, have already been eliminated this fiscal year. He advised the committee that the proposed budget assumes two additional cutbacks. He said that staff overall is working very hard and will be held more accountable as a result of the cuts. He added that a time clock would be installed to monitor staff time, overtime will require executive director pre-approval, and requests for temporary help will be largely curtailed. A brief discussion ensued with respect to staff issues; however, several members cautioned their colleagues against micro-managing.

A discussion then ensued with respect to meeting costs, with a member suggesting the increased use of "virtual meetings" as a way to save costs. Mr. Grumet added that the Society would also look at eliminating off-site meeting expenses, including costs associated with off-site board meetings.

A committee member expressed the view that the budget appears to represent an even-handed, fair and deliberative process, but added that accountability should be strictly enforced and measured.

02 – D – 04

It was noted that the Society has entered into an agreement with a non-Society-related business for office space at the Society’s headquarters. Mr. Schmelkin noted that the group consists of retired lawyers. Under the agreement, the group has limited access to Society copy machines, faxes and a phone line.

Several members expressed concern over the idea of renting space to non-Society-related entities due to confidentiality and security issues, and potential conflicts with the Society’s mission and purpose. Some members reminded the group that other entities already rent Society classrooms on a regular basis. Others noted, however, that the classrooms are physically separate from Society staff offices. After a brief discussion, the committee reached the consensus that all renting of office space should cease until a discrete policy can be developed by the Executive Committee regarding the issue.

A discussion then ensued regarding what to do about the current agreement. Mr. Schmelkin noted that the current agreement runs on a month-to-month basis and could be terminated with one month’s notice. After a brief discussion regarding whether and when to terminate the agreement, the committee consented to allow the current agreement to continue, for a period of six months.

Mr. Grumet noted that the Society’s current office lease will end in 2004, and the Real Estate Task Force is reviewing options for a new location. He noted that space has been identified on Madison Avenue and 38^th Street; however, the task force recommended that a broker be hired to assist in locating additional options. Ms. Newman-Limata expressed the need to have an Executive Committee member participate in that process. By consensus, the Executive Committee approved the issuance of the RFP to identify a broker.

02 – D – 05