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|
Governance
| MINUTES
OF: |
Foundation
for Accounting Education Trustees |
| DATE
OF MEETING: |
Tuesday,
May 17, 2005 |
| LOCATION: |
Ernst
& Young Offices
5 Times Square, 20th Floor |
| TIME
MEETING CONVENED: |
9:15 a.m. |
| TIME
MEETING ADJOURNED: |
11:07 a.m. |
| PRESIDING
OFFICER: |
Jeffery
R, Hoops, President |
| MEMBERS
PRESENT: |
John
J. Kearney, Vice President
Stephen F. Langowski, Secretary/Treasurer*
Sharon Sabba Fierstein
Alan T. Frankel
Gail M. Kinsella*
Ilene L. Persoff*
Jeffrey M. Rosenbaum*
Franco Strangis
Louis Grumet, Executive Director
|
| STAFF
PRESENT: |
Adam
Cheung
Alan Schmelkin
Monte Kaplan
Paul L. Sinegal
|
Minutes
| 0)
Call to Order |
President
Hoops called the meeting to order at 9:15 a.m.
|
| 1)
Minutes January 12, 2005 Meeting
|
Ms.
Fierstein moved to approve the minutes of the January
12, 2005 meeting, and Mr. Kearney seconded the motion.
The motion passed unanimously.
|
|
2) Financial Statements for Eleven Months Ending
April 30, 2005 |
Mr.
Cheung reviewed the financial statements for the eleven-month
period ending April 30, 2005, noting that FAE experienced
a decrease in net assets of $78,888. Mr. Cheung stated
that FAE’s budgeted contribution from the NYSSCPA
of approximately $533,000 had been utilized only to
the extent of $315,000, which was $218,000 under budget.
The Trustees responded favorably to this report, and
President Hoops asked that the minutes reflect the Trustees’
congratulations to staff for good work in keeping FAE’s
expenses on budget.
|
| 3)
Election to Fill 2005-2006 Trustee Vacancies
|
President
Hoops noted that five FAE Trustee vacancies needed to
be filled as of June 1, 2005 due to the expiration of
Sharon Fierstein’s and Ilene Persoff’s terms,
and also as a result of recent governance changes which
created three additional vacancies from FAE’s
outgoing President, President-elect and Secretary/Treasurer.
He reminded the Trustees that FAE’s officers would
no longer be automatically appointed by virtue of their
respective NYSSCPA officer position; instead, all vacancies
would be filled by the Trustees from among a group of
persons nominated by the NYSSCPA Board. He noted that
this change required that the nominees ultimately presented
to the Trustees be at least twice the number of vacancies
pending.
In
accordance with this new governance structure, President
Hoops reported that the NYSSCPA Board had nominated
the following ten individuals from which the FAE Trustees
could fill the five immanent vacancies:
-
Warren M. Bergstein
-
Arthur Bloom
-
Christopher J. Byrne
-
Roseanne R. Farley
-
Elliot L. Hendler
-
Scott J. Jaffee
-
Mary-Jo Kranacher
-
Peter K. Maier
-
D. Edward Martin
-
Reynaldo L. Padilla
In
order to maintain even rotation of the Board, President
Hoops proposed that the five vacancies be filled by
three trustees holding three-year terms, one holding
a two-year term and one holding a one-year term. The
Board agreed with this approach without objection. Also,
the Board by consensus agreed that the three individuals
who received the most votes would be elected to three-year
terms, while the two receiving the next-most numbers
of votes would be elected to two-year and one-year terms,
respectively.
The
FAE Trustees then reviewed and discussed the relevant
background information of each nominee, which was provided
in the meeting materials. In response to a question,
Mr. Schmelkin stated that the Trustees had been provided
the same background information as the NYSSCPA Board’s
selections subcommittee and the NYSSCPA Board itself.
Due
to the meeting participation of several Trustees by
phone, President Hoops asked if any Trustee objected
to holding an open vote election. The Trustees unanimously
agreed to cast their votes openly.
Upon
a duly-held election, Arthur Bloom, Elliot L. Hendler
and Peter K. Maier were elected to the three-year terms;
Scott J. Jaffee was elected to the two-year term; and
D. Edward Martin was elected to the one-year term.
President
Hoops reminded the Trustees that FAE’s officers
would be elected at a later time from amongst the 2005-2006
Trustees during their first meeting after June 1. Mr.
Schmelkin noted that an orientation for the five newly-elected
Trustees would be scheduled for the following Tuesday
and include an overview of FAE operations.
|
| 4)
Amendment to Certificate of Incorporation Regarding Purpose
of FAE |
President
Hoops presented a proposal to update the FAE Certificate
of Incorporation to specifically include FAE’s activities
regarding the scholarship program and the Career Opportunities
in the Accounting Profession (COAP) program. FAE had embarked
on these projects in the good faith belief that its current
purpose was broad enough to accommodate the projects.
Upon advice of Counsel, it was believed a more explicitly
stated purpose would be more prudent.
President
Hoops noted that the proposed amendments were prepared
by in-house counsel and reviewed by David Samuels, Esq.,
who was a former Deputy Chief of the New York State
Attorney General's Charities Bureau.
Ms.
Persoff moved the adoption of the following resolution,
which was seconded by Ms. Kinsella:
Resolved
that, subject to obtaining proper approvals from the
New York Attorney General and any other relevant Federal
or State government agencies, paragraph three (3)
of the Certificate of Incorporation of the Foundation
for Accounting Education, Inc. be amended to read
as follows:
(3)
The purposes for which the corporation is to be formed
are:
(a)
To engage in education and research in the field
of accountancy, to provide scholarships for the
pursuit of higher-education degrees in accounting,
to conduct educational programs emphasizing career
opportunities in the accounting profession, to develop
and improve education in the field of accountancy
and other professional areas, and to expand knowledge
in the accounting science, including, without limitation,
retaining and employing teachers and staff for the
implementation of continuing education programs
and research projects, developing joint programs
with other institutions and disciplines, establishing
beneficial relations with educators and educational
institutions, organizing accountants’ study-groups
around specific topics in accountancy, encouraging
and publishing books and pamphlets on accountancy,
and obtaining grants and funding for educational
and research projects.
(b)
No substantial part of its activities shall be the
carrying on of propaganda, or otherwise attempting,
to influence legislation; it shall not participate
in, or intervene in (including the publishing or
distributing of statements), any political campaign
on behalf of any candidate for public office.
(c)
Notwithstanding any other provision of this certificate,
the corporation shall not conduct or carry on any
activities not permitted to be conducted or carried
on by an organization exempt under Section 501 (c)
(3) of the Internal Revenue Code and its Regulations
as they now exist or as they may hereafter be amended,
or by an organization contributions to which are
deductible under Section 170 (c) (2) of such Code
and Regulations as they now exist or as they may
hereafter be amended.
(d)
Upon the dissolution or winding up of the corporation,
after paying or adequately providing for the debts
and obligations thereof, any remaining assets shall
be distributed exclusively to charitable organizations
which would then qualify under the provisions of
Section 501 (c) (3) of the Internal Revenue Code
and its Regulations as they now exist or as they
may hereafter be amended, subject to the approval
of the Supreme Court.
(e)
Nothing herein shall authorize this corporation,
directly or indirectly, to engage in or include
among its purposes, any of the activities mentioned
in Not-For-Profit Corporation Law, Section 404 (b),
(c), (e) – (v), Executive Law, Section 747,
or Education Law Sections 224 and 7401.
(f)
The corporation shall be subject to all of the restrictions
which pertain by law to not-for-profit corporations
so far as the same shall be applicable to it. In
furtherance of its corporate purposes, the corporation
shall have all general powers enumerated in Section
202 of the Not-For-Profit Corporation Law.
Resolved,
further that the officers and the executive director
are hereby authorized and directed to execute any
documents necessary to carry out this resolution.
After
a brief discussion, the motion passed unanimously.
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| 5)
Contract Matters |
a.
NYSSCPA/FAE Affiliation Agreement
Mr.
Schmelkin introduced the topic of an intercompany affiliation
agreement between the NYSSCPA and FAE, noting that the
proposed agreement had been in development for some
time to formally document the obligations each company
owes to the other. Mr. Grumet added that such an agreement
is considered a best practice for educational foundations
and their affiliated professional Societies. He noted
that the document was prepared by in-house counsel and
reviewed by Howe & Hutton, the Society’s outside
counsel.
In
response to a question, Mr. Cheung stated that FAE uses
NYSSCPA’s staff and facilities, but maintains
separate banking and financial accounts.
A
discussion ensued with respect to the agreement’s
requirement that FAE not amend its bylaws regarding
filling its Trustee vacancies without the express written
consent of the NYSSCPA. By way of background, President
Hoops reminded the Trustees that FAE changed its governance
structure to remove direct NYSSCPA officer control of
FAE, which previously resulted from the automatic assumption
of FAE officer positions by virtue of NYSSCPA’s
officer positions. Under the new structure, FAE would
be permitted to select its own officers from among the
existing Trustees. President Hoops stated that in exchange
for this governance change, FAE had agreed to limit
its selection of individuals to fill board vacancies
to a list to be provided by the Society, so long as
the NYSSCPA presented twice as many recommendations
as there were Trustee vacancies. President Hoops stated
that the NYSSCPA’s continued financial and administrative
support of FAE was contingent upon FAE’s assurances
that this new governance structure would remain in place,
unless otherwise agreed to by the NYSSCPA.
Ms.
Fierstein moved that the Affiliation Agreement between
NYSSCPA and FAE be approved, and that the FAE officers
and directors be authorized and directed to execute
the agreement on behalf of FAE. Mr. Strangis seconded
the motion. Following discussion, the motion passed
unanimously.
b.
Focus Audio Visual Services Contract
Mr. Schmelkin summarized the contract with Focus Audio
Visual Services and comparative bids received for similar
services. He noted that as compared to hotel audio-visual
services, the Focus contract provided the most cost
effective and reliable services and also guaranteed
its pricing for a period of three years. He noted that
FAE had been utilizing Focus on an event-by-event basis
for some time and had been satisfied with its services
to date. In response to a question, Mr. Schmelkin stated
that the contract was non-exclusive, thus allowing FAE
to utilize onsite hotel services or other external vendors
if doing so would provide better costs and services.
Mr. Schmelkin added that full FAE Trustee approval was
needed under FAE’s contract approval policy because
the expenditures under the contract during a 12-month
period were expected to exceed $100,000.
Ms.
Fierstein moved to approve the Focus Audio Visual contract,
and Ms. Kinsella seconded the motion. Following discussion,
the motion passed unanimously.
|
| 6)
FAE Program Items |
a.
Continuing Professional Education
Mr.
Schmelkin gave an overview of FAE conference highlights.
He noted that the month of May had several successful
events including the Business Valuation Conference,
which had over 160 attendees, and the Broker Dealer
Conference which had received 212 registrations to date.
In addition, Mr. Schmelkin stated that the Estate Administration
Conference was on budget and that enrollment in the
Entertainment & Sports Conference was strong.
b.
Scholarship Program
i.
Appointment of Scholarship Committee
Mr.
Grumet reminded the Trustees that per its actions
at a November 15, 2004 meeting, the implementation
of a new FAE scholarship program structure would take
effect as of the 2006 school year, with the existing
structure remaining in force throughout the 2005 school
year. He noted that the 2005-2006 FAE Trustees would
be responsible for planning towards a 2006 implementation
date, including appointing a scholarship program oversight
committee.
c.
Career Opportunities in the Accounting Profession (COAP)
Program
i.
Fundraising Efforts
Mr.
Grumet announced that the commemorative journal for
the annual NYSSCPA Board dinner raised approximately
$85,000 in advertising revenue, all going toward funding
of the COAP Program.
ii.
Plans for Summer 2005 Programs
Mr.
Schmelkin stated that plans for FAE’s summer
2005 program schedule were proceeding well.
|
| 7)
Potential Dates for Next Meeting; Temporary Check Signing/Contract
Approval Authority |
President
Hoops stated that the first FAE meeting of each fiscal
year typically took place in July at the NYSSCPA leadership
conference; however, a meeting may be needed prior to
that time in order to elect FAE’s officers. Mr.
Grumet reminded the committee that FAE check signing and
contract approvals up to specified amounts are typically
carried out by FAE’s officers, and suggested that
such authority be delegated to two Trustees until such
time as FAE’s officers are elected.
Ms.
Fierstein moved to authorize Trustees Arthur Bloom and
Alan Frankel to sign FAE checks and approve FAE contracts
under FAE’s contract approval policy until such
time as FAE officers are elected for the 2005-2006 fiscal
year. Mr. Hoops seconded the motion. The motion passed
unanimously. Messrs. Frankel and Langowski did not participate
in the vote.
The
Trustees by consensus agreed to set the date for the
next meeting at a later time.
|
| 8)
Executive Session |
No
executive session was held. |
| 9)
Adjournment |
There
being no further business, Mr. Kearney moved to adjourn
the meeting, and Ms. Persoff seconded the motion. The
meeting adjourned at 11:07 a.m. |
Respectfully submitted,
Stephen F. Langowski, Secretary |
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