0) Call to Order

President Golden called the meeting to order at 2:00 p.m.

1) Approval of Minutes

President Golden entertained a motion to approve the minutes for the meeting held on January 14, 2003. Mr. Riley moved and Mr. Kearney seconded a motion to approve the minutes as written. The motion was unanimously approved.

2) Appointment of New FAE Trustees

Ms. Golden noted the vacancy of two trustee positions due to the expiration of the terms of Mss. Katherine K. Doran and Diane M. Wiktorowski. Ms. Golden noted that under the bylaws, vacancies were to be filled through the following procedure:

1. Appointing by the Board of a nominating committee composed of the president and two other trustees.
2. Entertaining recommendations from the nominating committee with the full Board of Trustees then to fill the vacancies from among the nominating committee’s recommendations and any other nominations made by individual trustees from the floor.

Ms. Golden proposed that Ms. Fierstein and Mr. Riley serve with her on the nominating committee. The Board approved the composition of the nominating committee without objection.

Ms. Golden indicated that she hoped the nominations ultimately would include one upstate member in industry and a person from a small firm in the Northeast Chapter. She expressed her hope that the following year’s nominating committee choose members from the Buffalo and Rockland/Westchester areas.

The Board set 10:00 a.m., July 25th, 2003, for a conference call to hear the Nominating Committee’s report, solicit any additional nominations, and conduct an election to fill the vacancies.

3) Financial Matters

a. Report for Fiscal Year Ended May 31, 2003

Ms. Golden asked Ms. Chambers, the NYSSCPA/FAE director of finance, to present a report for the fiscal year ended May 31, 2003. Ms. Chambers noted that the report was based on numbers as they existed before completion of the pending audit. She indicated that the auditors were nearing completion of their fieldwork and no adjustments were expected at that time.

Ms. Chambers reported that net results for the fiscal year ended May 31, 2003 were ($378,847), which was $1,058,633 ahead of the prior year and included a $708,932 increase in total revenue and a $349,701 decrease in total expenses. She noted that these net results also reflected an improvement over budget of $215,653.

The Trustees then discussed the financial information presented. One trustee asked about in-firm and self-study revenue. Mr. Schmelkin responded that Mr. Monte Kaplan, who recently joined the staff, was making important progress in the in-firm area and they were now poised to press on to extend this program, targeting employers of members in industry as CPE consumers.

There was also a question about the self-study revenue that had been budgeted from e-Mind. The Board entered into executive session to discuss this question. No action was taken during executive session.

Another trustee raised a question on materials expense being significantly higher than budget. Ms. Chambers noted that advertising expense had been booked as materials, causing advertising expense to be under budget a similar amount. She explained that the accounting function had improved its ability to differentiate between materials and advertising relating to FAE events, resulting in booking of these expenses that was better than when the budget had originally been prepared. By consensus, the Trustees asked that these expenditures be reclassified, provided that a determination of reasonable estimates of the correct amounts could be made with relatively little effort.

A question arose regarding the “rentals and meals” expense in May which had $0.00 budgeted and $77,119 of actual expenses. Ms. Chambers explained that this was a phenomenon of estimating a monthly breakdown of budgeted conference expenses and none were specifically associated with May 2003 events at the time the monthly allocations of budget amounts were originally prepared. She noted that the monthly spread would more closely align with the actual expenditures in the current year because it was based on Mr. Schmelkin’s event-by-event budget information.

By consensus, the Trustees directed that in the future a variance analysis similar to that prepared for the NYSSCPA Board, be distributed monthly.

b. Report of Current-Year Results

Mr. Schmelkin noted that as of Thursday, July 10, FAE’s revenue was tracking very closely with the preceding year, i.e. within $100,000, providing an early indication that the current year might continue the successes of the prior year.

c. Appointment of FAE representatives to Financial Committee and Investment committee

This matter was deferred until the August Trustees’ meeting.

d. Resolution for Signatures on FAE Bank Accounts

Ms. Fierstein made the following resolution regarding signature authority over the corporation’s bank accounts. Mr. Riley seconded.

RESOLVED, that the following persons are hereby appointed to serve as authorized signatories on all banking and investment accounts of the Foundation for Accounting Education Inc.:

Jo Ann Golden
John J. Kearney
Louis Grumet
Alan Schmelkin
Robert H. Colson
James A. Woehlke
Joanne S. Barry
Dennis M. O’Leary

RESOLVED, FURTHER, that two signatures are required on every check and any check over $10,000 requires one of the signatures to be either Ms. Golden or Mr. Kearney.

RESOLVED, FURTHER, that the officers of the Foundation for Accounting Education Inc. and the staff of the New York State Society of CPAs are hereby authorized and directed to execute and deliver any documentation required to carry out the intent of this resolution.
Following discussion, the resolution was unanimously adopted.

4) Discussion of Development of Subject Matter and Topical Curriculum for Members in Industry

Mr. Schmelkin reported on the current efforts to market in-firm training opportunities, which, with the full time involvement of Mr. Monte Kaplan, were bearing fruit. Mr. Kaplan’s efforts were being expanded to include development of a curriculum for members in industry. Former FAE President Sokolski had appointed a task force under Mr. Richard Piluso which had begun crafting a core curriculum for members in industry. Mr. Schmelkin suggested it was time to reinvigorate that task force.

Mr. Grumet noted that although two years previously only one chapter had a members-in-industry committee, now five chapters had such committees: Buffalo, Nassau, Rochester, Syracuse, and Westchester. He suggested that if the task force were reintroduced, it should contain members from these chapter committees.

Another environmental change noted by the Trustees was the broader interest in mandatory CPE for members in industry and the belief that it was more and more likely to be enacted.

Ms. Fierstein moved that the Members in Industry Task Force be re-established and populated with a current member in industry on the Board of Trustees plus a member from each chapter’s member-in-industry committee. Mr. Hoops seconded the motion. Following discussion, the board unanimously passed the resolution.

5) Discussion of Broader Based Scope of FAE Services

Ms. Golden distributed the FAE Certificate of Incorporation and read its broad statement of purpose, which in relevant part was as follows:

To engage in education and research in the field of accountancy, to develop and improve accountancy education, 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.

Ms. Golden expressed a desire to expand FAE’s activities beyond providing CPE, sponsorship of the Career Opportunities in the Accounting Profession (or COAP) program, and administration of a scholarship program. She then opened the floor to discuss additional areas to be explored. The following suggestions were made:

• Educate corporate directors about the issues they should be aware of to fulfill their fiduciary responsibility in the wake of the enactment of the Sarbanes/Oxley Act (Mr. Grumet noted that the PCAOB had money available to fill this need and suggested that perhaps grant money might be available.)
• Develop tools for members and FAE registrants to perform self-assessments
• Help train school board members to better understand financial statements and learn what to ask their auditors. (Mr. Grumet noted that during a recent meeting of NYSSCPA leadership with New York State Chancellor Bennett, the Chancellor had asked for help in this area.)

Ms. Grumet noted that while some or all of these projects were not central to the NYSSCPA mission, they fitted squarely within the purpose of the Foundation. Ms. Fierstein said that any projects outside the NYSSCPA mission would need to be done via grant money from outside the Society.

Mr. Grumet said that if he were forced to recommend only one item, it would be the PCAOB project. He added, however, that the school board educational initiative could be done at very little cost by updating materials published ten years previously by the Society and owned by the New York State School Boards Association. He believed the PCAOB project would be the most attractive to NYSSCPA members, especially if it could be done with PCAOB funds.

The consensus of the Trustees was to proceed with a PCAOB grant request, so long as this could be done at little or no cost.