Financial Surplus – Action Plan Moving Forward

Over the course of routine financial due diligence by the Finance portfolio, it was discovered that there had been variances in budget projections for several years. These variances saw the Commerce Undergraduate Society (CUS) ending the 2017/18 year with a $74,573 operating surplus, and surplus cash of $191,955. This functionally provides the CUS this year the resources to effectively invest in more of our services’ short and long-term strategies, and grants us the financial freedom to consider areas of added impact that we can establish for our student body.

These surpluses are believed to be the result of underprojected student fee revenues from the CUS 2017/18 year, and the safety buffer that had previously been included in the budget. In greater detail:

1. Student Fee Revenues: This had been projected to be $910,000 in the CUS 2017/18 Budget, where the actual revenues collected were $959,999, resulting in a surplus of $50,000.  

2. Safety Buffer: Some variance can be traced to the fact that the buffer had traditionally been treated as a recurring annual expense rather than as a contingent liability. The Society had therefore been automatically budgeting for an artificial expense that was never realized nor reversed, resulting in $40,000 in funds typically being overlooked at the end of each fiscal year.

The CUS acknowledges the impact that this budgetary oversight has had on our operations and therefore on our student body. As an Undergraduate Society, we take to heart our responsibilities to efficiently allocate student resources, and to provide the most impact possible to the Sauder student community. We work hard throughout the year to ensure that our processes are as accountable and transparent as possible, and that the many operations and services we fund all abide by CUS values, work efficiently, and meet the needs of our student body. This year will be no exception.

To that end, we are, and will be, addressing the surplus in the following ways:

1. Corrective Measures: Changes have already been integrated into the CUS 2018/19 Budget, such as the elimination of the buffer and the creation of an operational reserve instead, and a revised student fee revenue projection model. Any further questions on the nature of these changes can be directed to the Vice-President, Finance of the CUS, Ajit Joseph, at ajit.joseph@cus.ca

a. Student Fee Revenue Projection Model: Student fee revenue is now projected based on anticipated enrolment numbers received from the UBC Sauder Undergraduate Office. With the understanding that enrolment numbers may fluctuate, student fee revenue projections will be re-calculated based on updated numbers that we receive in October from the UGO, for added accuracy.

2. A More Rigorous Budgeting Process: There are now additional rounds of budget submissions to optimize service and internal spending, and projection. This should result in fewer and smaller differences from the budgeted figures. Furthermore, to ensure projected expenses are as accurate and updated as possible, we plan to implement a stringent threshold for allowable deviations, thus increasing the number of line items that the Finance Portfolio will double-check with market data.

3. A More Detailed Budget Report: We are working on releasing a more detailed report by the end of August 2018. The aim of this budget report is to provide our student body with greater detail on our spending, such that our constituents can better understand and thoughtfully analyze the services and operations funded by the CUS.

4. Collaboration with Service Chairs: We will be looking to work with students and the CUS Service Council to identify relevant and efficient ways to utilize the surplus cash. Particular emphasis will be placed on identifying sustainable, long-term spending strategies and avenues.

The CUS is in a constant cycle of evaluating its processes and making them as efficient, valuable, and accountable as possible. We always seek to improve upon previous iterations, and to grow sustainably with our community. This surplus in particular gives the Sauder student body and student leaders an opportunity to contribute opinions as to where value can be most added to the community. We therefore invite you all to please direct your comments, questions, and suggestions through this form to continue the dialogue.

 

Sincerely,

 

Evan Zhou

President of the Commerce Undergraduate Society

 

Priscilla Chan

Chairperson of the Board of Directors and Commerce Student Senator