| |
|
Governance
| Minutes
of: |
Executive
Committee Meeting |
|
| Date
& Time: |
Thursday,
May 18, 2006, 9:10 a.m. to 3:15 p.m. |
| Location: |
NYSSCPA
Offices, 3 Park Avenue, 18th Floor, Room 1 |
| Presiding
Officers: |
Stephen
F. Langowski, President |
| Executive
Committee Members Present: |
Thomas
E. Riley, President-Elect
Susan R. Schoenfeld, Vice President
Stephen P. Valenti, Vice President
Raymond M. Nowicki, Secretary
Neville Grusd, Treasurer
Joseph M. Falbo, Jr.
|
Mark
Ellis
John J. Lauchert
David J. Moynihan
Debbie A. Cutler
C. Daniel Stubbs, Jr.
Louis Grumet, Executive Director
|
| Staff
Present: |
Joanne
S. Barry
Adam Cheung
Ernest J. Markezin
|
William
Pape
Alan Schmelkin
Paul L. Sinegal
|
M I N U T E S
| EC06
– B – 0
Call to Order
|
President
Langowski noted that a quorum was present and called the meeting
to order at 9:10 a.m. |
| EC06
– B – 1
Minutes
|
a.
Approval of Minutes of February 7, 2006, Executive Committee
meeting
Mr.
Langowski asked if there were any changes to the draft minutes
of the February 7, 2006, Executive Committee meeting. Ms.
Cutler provided typographical corrections to be incorporated
in the final draft of minutes.
Mr.
Moynihan then moved to approve the minutes as corrected
by Ms. Cutler, and Mr. Falbo seconded the motion. The motion
passed, with Ms. Schoenfeld abstaining.
b.
Minutes of April 6, 2006, Board of Directors Meeting for
Information Only
For
its information, Mr. Langowski referred the Executive Committee
to the draft minutes of the April 6, 2006, Board of Directors
meeting, which were provided in the agenda materials.
|
EC06 – B – 2
President’s Report
|
a.
AICPA Update
Mr.
Langowski referred committee members to a copy of the agenda
for the May 21-23, 2006, AICPA Spring Meeting of Council.
He said that the AICPA’s relocation from Jersey City,
New Jersey to Durham, North Carolina would be an issue of
discussion at the meeting, but observed that the agenda
was otherwise light. He reported that the AICPA was projecting
an employee retention rate of 15%, representing the percentage
of employees who were anticipated to keep their jobs and
move with the organization to North Carolina. He said that
the quality and training of the employment recruitment pool
in the Durham, North Carolina area was therefore vital to
achieving as little disruption as possible to AICPA operations.
b.
FAE Update (including COAP Fundraising Update)
Mr.
Schmelkin announced that at the April 26, 2006, meeting
of the FAE Board of Trustees, Edward Martin, Ann Burstein
Cohen and Alan Kahn were elected to join the FAE board as
of June 1, 2006 for three-year terms. He said that Gail
M. Kinsella, now FAE-President-elect, would automatically
assume the FAE Presidency as of June 1, while the remaining
2006-2007 FAE officers would be elected from among the Trustees
themselves during a meeting of the FAE Board at the Society’s
July Leadership Conference. Mr. Schmelkin reported on several
additional highlights of the April FAE Board meeting, including
the establishment of a FAE curriculum committee which would
include representation from the following Society committees:
Accounting and Auditing Oversight Committee, Tax Division
Oversight Committee, Chief Financial Officers Committee,
Small Firms Practice Management Committee, and Medium and
Large Firms Committee.
President
Langowski announced that the commemorative journal for the
Annual Board Election Meeting & Dinner had garnered
approximately $76,000 in advertising revenue, all going
towards funding of the FAE program COAP (“Career Opportunities
in the Accounting Profession”).
Mr.
Stubbs mentioned that a videographer had taken film footage
of participants in the COAP program over several years,
and that the videographer had hoped to develop the footage
into a promotional piece for use by FAE in connection with
the COAP program. He noted that the project had stalled
over contract negotiations; however, he said that the videographer
had expressed a willingness to make concessions on contractual
issues so that the project could be completed. He expressed
confidence that the issues would be resolved favorably.
Mr. Grumet noted that a full resolution of the contractual
issues was essential before finalizing any arrangement with
the videographer.
A discussion
ensued regarding COAP program venues, including challenges
experienced by the COAP Advisory Committee and staff in
planning a program in the Northeast region. Mr. Stubbs spoke
to those challenges, noting that the involvement of local
government interests in the program had created hurdles
that undermined the efforts of the program.
He noted
that, for example, in Albany local officials mandated that
all COAP program applications be administered in part through
an organization which is often associated with dysfunctional
families and abused children. Mr. Stubbs stated his opinion
that these issues undermined student interest in the program.
Mr. Grumet stated that despite these and other hurdles,
such as campus construction that prevented establishing
a residential COAP program at two Northeast college campuses,
staff would continue to work with the COAP Advisory Board
to pursue viable programs in the Northeast region.
c.
Recommendation to Confer with Officers’ Respective
Successors
Mr.
Langowski encouraged those officers whose terms were set
to expire as of May 31, 2006, to confer with their incoming
officer counterparts with regard to their positions. He
said that this would help ease incoming officers’
transitions into their new leadership roles.
d.
Update on Bylaws Process
Mr.
Langowski noted that Society governance and other issues
often required reference to and interpretation of the Society’s
bylaws in the pursuit of the organization’s mission
and business. He said that a full review of the Society’s
bylaws was therefore warranted in order to make sure that
they adequately address organizational governance, and are
sufficiently “state of the art” to deal with
issues that may come up in the future. He said that Mr.
Riley, Mr. Woehlke and he had spoken about such a bylaws
review. Mr. Langowski encouraged the additional discussion
by the Executive Committee of a bylaws review process in
the near future.
|
EC06
– B – 3
President-elect’s Report
|
a.
Quality Enhancement Policy Committee
President-elect
Riley reported that the Quality Enhancement Policy Committee
(QEPC) had moved on to reviewing the Society’s Ethics
program. With respect to Ethics, he noted that the QEPC
had developed a number of talking points and questions that
would be presented to the Society’s Ethics Committee
for response, comment and input. He announced that incoming
President-Elect, David A. Lifson, had agreed to chair the QEPC
during the 2006-2007 fiscal year.
b.
2006 Leadership Conference
Mr.
Riley announced that the overall theme of the 2006 Conference
was Professional Ethics and that the Chairman of NASBA (National
Association of State Boards of Accountancy) had agreed to
speak at the 2006 Leadership Conference, scheduled for July
9-11, 2006, at the Gideon Putnam Hotel in Saratoga Springs,
New York. In addition, former Society president Marilyn
Pendergast, as well as John Dodsworth, the President and
CEO of CAMICO Insurance Company, the Society’s exclusively-endorsed
provider of CPA professional liability insurance would also
participate in the Plenary Session Ethics panel.
c.
Preview of 2006-2007 Committee Appointments
Mr.
Riley referred committee members to the meeting agenda materials
for a list of committee appointments he had made for the
2006-2007 fiscal year. He reminded the Executive Committee
that Society Treasurer Neville Grusd serves as chair of
the finance committee pursuant to the bylaws. Mr. Riley
stated that additional appointments would be made in the
coming weeks.
|
EC06
– B – 4
Vice Presidents’ Reports
|
a.
Reports on Chapters
Vice
President Valenti presented a report on chapters. He mentioned
that in accordance with President Langowski’s recommendation
to confer with incoming officers, he had invited 2006-2007
Vice Presidents Fierstein and Piluso to participate in the
next chapter presidents’ conference call.
Vice
President Valenti then presented a request by current Finger
Lakes Chapter officers to dissolve the chapter due to the
lack of expressed interest in serving as chapter officers
in the upcoming year. He noted that the chapter had approximately
150 members, but had generally struggled to organize or
generate interest in chapter-related activities. He commended
the efforts made by the current Finger Lakes Chapter leadership
to reach out to chapter members, but said that these efforts
had been unsuccessful.
A discussion
ensued as to whether the Executive Committee should make
a recommendation to the Board supporting the Finger Lakes
Chapter dissolution. Several members stated that such a
recommendation may be premature, and suggested that the
June Executive Committee consider the request for a possible
recommendation to be presented to the full Board at its
July meeting. The Executive Committee members agreed with
this approach.
b.
Recent Society Comments
Vice
President Schoenfeld reported that there had been no new
comment letters issued since her last report to the full
Board in April; however, there was currently a comment letter
being finalized for submission to the AICPA in the coming
weeks.
|
EC06
– B – 5
Secretary’s Report
|
a. Committees
Update
Secretary Nowicki
drew the committee’s attention to a complaint by some
committees that articles developed by their respective members
were often submitted to Society publications, but never
ultimately published. He noted that the CPA Journal
in particular appeared to favor articles written by academics,
as opposed to practitioners. He suggested that some of these
unpublished articles alternatively be published on the Society’s
website or shared with the members through some other medium
such as e-mail. Mr. Ellis additionally suggested that such
e-mails could be targeted to specific groups of members
who have expressed interest in the subject matter of a particular
article. Mr. Markezin said that the articles could also
be included with current “e-mail updates”, which
were sent to committee members every two weeks. All suggestions
were well-received.
A discussion
ensued regarding some of the reasons why articles from committee
members and other CPA practitioners were not published as
often as articles written by academics. Some noted that
overall article quality was sometimes an issue. Mr. Grumet
said that articles from committee members and other practitioners
were not submitted with the same level of frequency as those
submitted by academics, and therefore were not as prevalent
in Society publications. He said that staff would nonetheless
look at the suggestions for alternative publication venues.
|
EC06
– B – 6
Treasurer’s Report
|
a.
Financial Statement for ten Months Ending March 31, 2006
Mr.
Grusd presented the Financial Statement for the ten months
ending March 31, 2006. He noted that FAE had not made its
budget by approximately $238,000 and was requesting a contribution
from the Society over and above the $624,000 contribution
budgeted for fiscal year 2005-2006. The request was discussed
and voted on later in the meeting, under item EC06-B-11.
Mr. Grusd reported unrestricted net income to the Society
and FAE as of March 31, 2006 of $623,000, which exceeded
budget by $612,000. He attributed the favorable increase
to several items:
-
$357,000 decrease in overall overheads, including approximately
$285,000 savings in personnel costs for vacant staff positions.
-
$249,000 gross profit in membership dues.
-
$92,000 increase in Chapter activities gross profit.
He noted
that The CPA Journal had experienced a decrease
in gross profit of $127,000. He said that the unfavorable
variance was due to a decrease in display ads. Unrestricted
cash and cash equivalents and investments were reported
to have increased by approximately $1,216,000 to $2,309,000
compared to last year. Approximately $1,400,000 was spent
on leasehold improvements in fiscal year 2004-2005. Mr.
Grusd stated that the Society was therefore doing well overall.
Mr.
Grusd indicated that the Finance Committee would be considering
the development of a three-year financial plan and commented
on planning for a reserve fund, noting that the Finance
Committee was supportive of the idea and viewed it as a
prudent practice. He noted that Finance Committee discussions
would continue on how to develop a plan to achieve a reserve,
but noted that guidance was needed from the Board with respect
to strategic plan considerations. Mr. Langowski suggested
that the Finance Committee first develop some questions
as to what information it needs, and to present this to
the Executive Committee. The Executive Committee agreed
with this approach by consensus.
|
EC06
– B – 7
Executive Director’s Report
|
a.
State Board of Accountancy and Health Department Updates
Mr.
Grumet gave an update on Health Department negotiations
regarding Medicaid cost reporting issues, noting that approximately
$44 billion in funds were at stake affecting eight health
facility programs in New York. He noted that the Society’s
Health and Non-Profit Committees were working closely with
the various state agencies to resolve outstanding issues.
(See immediately below for Mr. Grumet’s update
on the State Board of Accountancy)
b.
Legislative Update
Mr.
Grumet reported about a meeting he had with Dan Dustin,
Executive Secretary of the New York State Board for Public
Accountancy, during which a detailed comparison between
the Society’s sponsored accountancy legislation and
alternative legislation supported by the State Board was
reviewed. He noted that the meeting was informative and
useful for resolving issues of disagreement.
Mr.
Grumet also reported on pending fire district legislative
proposals. He noted that the legislation committee was not
supportive of some of the language and wording in the proposals,
and therefore would be working to propose alternative language.
c.
Member Benefits Update
Mr.
Grumet referred Executive Committee members to a statistical
summary of member benefits programs provided in the agenda
materials.
d.
Additional Reports (not on agenda)
(1)
Mr. Grumet announced the following count of proxy ballots
received as of the 9:00 a.m. deadline for nominated 2006-2007
NYSSCPA Officers and Board members:
Total
proxy ballots received 2,820
Less: Invalid ballots 92
Valid ballots 2,728
In
Favor 2,674
Opposed/partially opposed 54
Regarding
item #2, there were 2,074 proxies
Regarding
item #3, there were 1,994 proxies.
Mr.
Grumet noted that the results would be officially accepted
at that evening’s Annual Election Meeting and Dinner.
Two
Executive Committee members from Syracuse expressed concern
that their voting ballots had not been received in a timely
fashion. Ms. Barry noted that the ballots had been mailed
out by first class mail via a third-party mailing house
well in advance of the response deadline. After some discussion,
it was suggested that staff look into changing its mailing
company. Mr. Langowski asked staff to look into this suggestion.
(2)
Mr. Grumet announced that 11.4% of 2006-2007 membership
dues had been paid to date, which was on track.
|
EC06
– B – 8
Peer Review Committee Chair Letter of February 6,
2006
|
President
Langowski referred members to an analysis of the February
6, 2006, letter to the Executive Committee from then-chair
of the Peer Review Committee, Paul Salmin regarding concerns
over the Society’s handling of peer review administration
in New York. The text of Mr. Salmin’s letter was also
included in the agenda materials.
|
EC06
– B – 9
Peer Review Site Visit
|
Mr.
Langowski announced that he had recently appointed the Peer
Review committee’s Vice Chair David Moynihan to the
position of Chair. Mr. Moynihan then reported on the results
of a peer review oversight visit conducted by the AICPA
Peer Review Board. A copy of the AICPA report had been e-mailed
separately to Executive Committee members.
Mr.
Grumet advised the Executive Committee that he felt good
about the results of the oversight, having been first in
the nation to undergo a review under the new more stringent
standards. He indicated that the items in the oversight
report provided a helpful roadmap. He also indicated that
this oversight seemed more accurate than the previous oversight
report, and that he believed that the higher rating from
the prior oversight was very superficial and did not give
an accurate picture of the Society’s performance in
its peer review program. Mr. Grumet said that he had indicated
this view concerning the prior oversight report to the AICPA
oversight review team at the opening conference, and had
asked for a more thoroughgoing report.
Mr.
Moynihan stated that he was committed to putting the Peer
Review Committee and program in good stead as chair. He
acknowledged that the findings of the oversight board during
its visit were generally poor, and said that he would be
working closely with staff and the Peer Review Committee
to respond to the report point-by-point in the coming weeks.
Mr.
Nowicki provided some history on the peer review oversight
process, noting that the Society had previously received
a poor report for a similar finding on timeliness but had
worked to improve the deficiencies in program administration
and subsequently received a good report from the AICPA approximately
fourteen months ago. He noted, however, that since that
time the administration of the program had faltered. He
said that this had been communicated to the Executive Committee
and Board in the minutes of meetings from September and
December, 2005, and again with the Peer Review Chairman’s
letter of February 2006. Mr. Nowicki advised that the Society
must be more professional and proactive in administration
of its existing peer review program in conjunction with
the Society’s desire and goals to raise the bar for
the profession as a whole. Mr. Nowicki felt that we have
failed our members by obtaining a modified report on administrative
matters from the AICPA, but that the AICPA inspections have
always acknowledged our Society’s capability in properly
concluding on peer reviews in New York from the standpoint
of technical standards.
He further
suggested to the Executive Committee that all levels of
governance, from the most senior level officers to all staff
must be responsible for improving in the future. Another
committee member, acknowledging Mr. Nowicki's assessment,
noted that the AICPA's constructive criticism was offered
to both the staff and the committee. He remarked that the
members could not help but be positively affected by a constructive
response to the AICPA's suggestions by both.
Mr.
Moynihan mentioned that staff turnover before the busiest
season of the year for peer reviews in the fall, plus the
training of new technical review staff coincided to create
a number of administrative issues and a backlog. He also
reiterated that despite a poor report, New York’s
program was the first in the country to be reviewed under
the AICPA’s more stringent standards.
Mr.
Grumet added that outside technical reviewers had been engaged
to assist with the backlog and that several others were
being carefully considered to assist with training staff
on technical reviews. He also provided a brief summary of
the site visit, saying that he welcomed the frankness of
the report. He noted that the Ethics and Peer Review Committees
had traditionally viewed themselves as reporting directly
to the AICPA in the administration of these programs in
New York, not to the Society Board. He noted, however, that
after the auditing scandals earlier in the decade and the
more recent New York school district auditing scandals,
staff began to look more carefully at the program and discovered
a number of problems with peer review which staff had been
working to fix.
Mr.
Langowski asked Mr. Moynihan to briefly outline the process
of responding to the AICPA report. Mr. Moynihan said that
he would be working with staff to present an initial draft
response to the Peer Review Committee, which was set to
meet on May 30, 2006, and that he was committed to have
a completed draft available for the Executive Committee’s
review at its June 15, 2006, meeting. Mr. Nowicki suggested
that the AICPA’s report, and Mr. Moynihan’s
response be published on the Society’s website to
encourage transparency of the process. Mr. Grumet welcomed
the suggestion, saying that an article in The Trusted
Professional would also help to promote transparency
and inform members.
Mr.
Nowicki moved that once the response is drafted and accepted
in final by the AICPA, that staff post the review and response
on the website subject to AICPA approval. Ms. Cutler seconded
the motion.
In the
ensuing discussion, several agreed that transparency was
important but cautioned that other considerations including
the acceptance of the AICPA and the disclosure of employees’s
identities needed to be more carefully considered before
publishing the report and response. In addition, the AICPA’s
permission to publish the report would be sought. Mr. Moynihan
then moved to postpone the motion until the June 15, 2006,
Executive Committee meeting in order to more carefully address
these issues. Mr. Falbo seconded the motion. The motion
to postpone passed unanimously.
|
EC06
– B – 10
Peer Review Governance Issues
|
See
above items relating to Peer Review
|
EC06
– B – 11
Budget Amendment Relating to FAE
2005/06 Operations
|
Mr.
Grusd presented a request from the FAE Board of Trustees for
an additional $238,000 contribution from the Society to FAE.
He noted that the Society’s 2005-2006 budget had originally
allocated a contribution of $624,000 to FAE; however, a number
of unanticipated issues made it necessary for FAE to request
$238,000 over and above the originally budgeted amount. He
said that staff time, direct expenses and other FAE overheads
during the 2005-2006 year accounted for approximately $142,000
of the additional request. He explained that staff time was
not a static expense category, but could change depending
on timesheet data inputs by staff. In addition, Mr. Grusd
noted that staff had advised FAE’s office space allocation
had been overestimated in the prior year’s budget, and
that the Society was actually using some of FAE’s allocated
space for Society business and meetings. He noted that these
space allocations were revised in the coming year’s
budget and thus would have a positive impact on FAE’s
future needed contribution. Mr. Grusd additionally noted that
FAE’s projected gross profit for the fiscal year was
approximately $96,000 under budget, which was attributed to
lost revenue on a number of poorly attended or cancelled industry
courses, increased costs at outside facilities for meals and
rentals and audio-visual charges, and the financial support
for a number of upstate seminars for the benefit of Society
members in those locations. Mr. Grusd concluded by noting
that the Society’s strong cash position would allow
it to honor FAE’s request.
In the ensuing discussion, Mr. Grusd asked why FAE had
recently rented space at the Princeton Club for the Chief
Financial Officers (CFO) Conference. Mr. Schmelkin responded
that the CFO committee had requested approval of the venue
only after obtaining corporate sponsorships for the conference.
He said that the request was ultimately approved when it
was demonstrated that the corporate sponsorships would offset
the expense of the Princeton Club. Mr. Ellis, a member of
the CFO Committee, also provided several additional considerations
which went into the CFO committee’s request to hold
its conference at the Princeton Club.
In response to a question, Mr. Grumet noted that initial
projections as of early April had indicated FAE would need
$190,000 in additional contributions from the Society, which
was announced at the April 6, 2006, NYSSCPA Board meeting;
however, after a review of several May conferences’
attendance and registration figures, staff was now projecting
that FAE would require $48,000 more, for a total of $238,000.
Mr. Grumet explained that originally budgeted revenues for
FAE’s May 2006 conferences were based in large part
on budget attendance for those events during May 2005. He
said, however, that a number of these conferences had drawn,
or were currently indicating smaller registrations than
prior years, thus decreasing anticipated May revenue. He
said that these conferences included the Business Valuation,
Employee Benefits, Estate Administration, and Anti-fraud
conferences. He noted that systems were in place to allow
staff to monitor the anticipated performance of conferences
in more of a “real time” fashion than had existed
previously, but that the information nonetheless was not
ripe for analysis as of the early April Board meeting.
Some committee members stated that they were surprised
to learn at the last minutes of the need for a Society budget
amendment to address FAE’s budget shortfall, and asked
staff to address what FAE would be doing in the future to
prevent additional requests. Mr. Grumet noted the FAE Board
asked staff to communicate FAE’s understanding that
future cutbacks may be needed to address FAE’s budget
issues going forward. Mr. Grumet then summarized several
areas discussed by the FAE board in April as potential cutbacks.
He noted that, for one, FAE’s current subsidy of an
industry CPE curriculum needed to be carefully reassessed
and possibly reconsidered, due to the substantial revenue
losses in that area. He said that he also wished to switch
the current FAE industry in-firm position to service the
Society’s industry committees, which would help to
enhance the Society’s outreach efforts to industry
members and assist FAE in identifying issues regarding its
underperforming industry programs. In addition, he said
that the acquisition of additional space on the 19th floor
of the society’s offices would allow FAE to run larger
conferences in-house, instead of at more expensive Manhattan
hotels. He noted that FAE could additionally reconsider
whether to subsidize certain upstate programs; however,
he pointed out that upstate members had fewer CPE alternatives
and the discontinuance of upstate sessions could have an
adverse impact on upstate members. He said that staff would
be working with FAE Board of Trustees to identify additional
areas of potential cutbacks, and he would communicate these
to the Executive Committee at a future meeting. Mr. Ellis
suggested that the FAE Board and the Society’s Executive
Committee hold a joint meeting to review these issues. The
suggestion was well-received.
Mr.
Nowicki moved to amend the Society’s 2005-2006, fiscal
year budget to provide for an additional $238,000 contribution
from the Society to FAE for FAE operational expenses and
to move the current FAE in-firm CPE manager position to
be an industry outreach person for the Society. Mr. Moynihan
seconded the motion. The motion passed. Mr. Valenti abstained.
Mr.
Nowicki then moved to request a meeting between the NYSSCPA
Executive Committee and the FAE Board of Trustees during
the next fiscal year to examine FAE market share, course
revenues and to develop a plan to ultimately place FAE in
a better financial position going forward. Mr. Grusd seconded
the motion. The motion passed. Mr. Valenti abstained.
|
EC06
– B – 12
Membership Report
|
Mr.
Pape presented the Membership Report as of May 18, 2006,
which included 117 new members (including 73 new associate
members), 22 reinstatements, 12 deaths, 4 resignations,
and 1 ethics termination. These changes reflected a total
membership of 29,326 as compared with 30,070 at that time
the previous year. Mr. Grusd noted a large decrease in the
number of students and industry members. He suggested that
this be monitored and discussed by the Executive Committee
at a later time.
Ms.
Schoenfeld moved to approve the Membership Report and Mr.
Riley seconded the motion. The motion passed unanimously.
Mr.
Pape additionally reported that beginning in June, 2006
staff would be reviewing the membership status of FAE seminar
attendees and soliciting potential memberships from those
non-member attendees who qualify for Society membership.
He noted that staff would also be pursuing increased opportunities
for in-firm presentations regarding Society membership.
|
EC06
– B – 13
Office Sharing Arrangement Proposed by the National
Asian-American Society of Accountants
|
Mr. Grumet withdrew the proposal
and no action was taken by the Executive Committee.
|
EC06
– B – 14
Release of Terminated Member Information to AICPA
|
Mr.
Grumet withdrew the request and no action was taken by the
Executive Committee.
|
EC06
– B – 15
Renewal of Line of Credit
|
Treasurer Grusd gave a brief
summary of the documents required to renew the organization’s
$500,000 line of credit with the Bank of America, noting that
the line was being offered at a prime rate. He said that a
number of issues in the documents were still being scrutinized
by legal counsel; however, he projected no immediate or near-future
need to draw from the line of credit. He said that, among
other things, the Bank of America was amenable to changing
the line maturity date from May 31 to a later date in July.
He said this change would allow for the election in July of
FAE’s 2006-2007 officers, who would be required to sign
documentation on behalf of FAE relating to its guarantee of
collateral.
A brief discussion ensued with respect to the Society’s
negotiation power of the requirements imposed by the bank
to enter into the letter of credit. The committee also discussed
the amount of money currently on deposit at the Bank of
America, and the effect that the current $100,000 FDIC insurance
limits may have on the society’s accounts.
Mr. Langowski noted that there were a number
of additional covenants contained in the documentation that
needed to be particularly scrutinized in terms of their
potential impact on society business. He asked that if any
Executive Committee members had any questions or feedback
regarding the documentation, to please contact counsel James
Woehlke. He suggested that the issue be brought back to
the Executive Committee or Board for a vote at a later time,
after staff concludes its due diligence efforts. The Executive
Committee agreed with this suggested approach by consensus.
|
EC06
– B – 16
Executive Session
|
The Executive Committee went
into Executive Session. No resolutions resulted.
|
EC06
– B – 17
Adjournment
|
There being no further business,
the meeting concluded after the executive session at 3:15
p.m. |
Respectfully
submitted,
Raymond
M. Nowicki
Secretary
|
|
