Handbook on Financial Resources Management and Development

Handbook on Financial Resources Management and Development

1

Handbook on Financial Resources Management and Development

World Scout Bureau Asia-Pacific Region P.O. Box 4050, MCPO 1280 Makati City, Philippines Tel: (63 2) 817 1675/818 0984 Fax: (63 2) 819 0093 Email: asia-pacific@scout.org website: wwww.scout.org/asia-pacific

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Handbook on Financial Resources Management and Development

Handbook on Financial Resources Management and Development

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Handbook on Financial Resources Management and Development

C

World Scout Bureau

Asia-Pacific Region September 2007 ISBN 978-971-91927-7-0 www.scout.org

World Scout Bureau Asia-Pacific Region 4/F ODC International Plaza Building 219 Salcedo Street, Legaspi Village Makati City, 1229 PHILIPPINES Reproduction is authorised to national Scout associations which are members of the World Organization of the Scout Movement. Others must request permission from the publisher.

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Handbook on Financial Resources Management and Development

Contents I.

II.

Message of the Chairman

7

Foreword of the Regional Director

8

Financial Resources Management

9

• Financial Accountability • Ethics and Policy • Integrated Strategic Financial Planning • Fundamentals of Corporate Governance • Budgeting • Audit • Insurance • Investments III.

Financial Resources Development

22

• Internal Resources a. Membership Fees b. Property Development c. Scout Supplies d. Endowment/Foundation Funds e. Events f. Intellectual Property g. Business/Commercial Activities • External Resources i. Government Grants j. Donations and Sponsorship k. Special Events l. Affinity program

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Handbook on Financial Resources Management and Development

IV.

Fund Raising

40

• Principles of Fundraising • Techniques of Fundraising • Procedures of Fundraising • Examples of Fundraising V.

Partnerships

45

• Objectives of Partnerships • Principles of Partnerships • Creating a Partnership • Examples of Partnership VI.

Project Management

49

• Definition • The triple component • Features of Project Management • Project Management Activities • Elements of Project Management • Evaluation • Reporting • Challenges of Project Management • Project Manager VII.

6

Acknowledgement

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Handbook on Financial Resources Management and Development

Message Dear Readers, I am happy to present to you this much-awaited Handbook on Financial Resources Management and Development. This special gift to National Scout Organizations underscore the essential values of Scouting: resourcefulness and self-reliance.

As Scouts, we have a great responsibility to take care of our God-given resources like nature and environment in as much as we are accountable to the resources, big or small, that are bestowed on us, Our goal is to manage our financial resources efficiently and use them effectively.

I congratulate the APR Financial Resources Sub-Committee (2004-2007) who developed this booklet from its raw material to its final production, which is indeed a practical guide for National Scout Organizations. May I also commend the participants of the 1st International Resources Development Seminar held several years ago in Indonesia for conveying the idea that good practices can be learned, improved, strengthened and shared.

Using this handbook as a guide, even small steps if taken in great numbers, could yield abundant results. Sustaining our resources could be a practical way of living up to the challenge left to us by Lord Baden-Powell – to try and leave this world a little better than we found it.

Jejomar C. Binay Chairman APR Scout Committee

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Handbook on Financial Resources Management and Development

Foreword

possibilities emanating from the discussions gave birth to the idea of

This booklet is a resource for the

producing this handbook. It was also

financial management of a National

noted that a number of resource

Scout Organization (NSO). It pro-

materials have been written on this

vides principles that enable NSOs to

broad topic. However, the region’s

develop their own strategies and

Financial Resources Sub-Committee

procedures for the effective manage-

believes that a handbook customized

ment of their financial resources. It

for the unique culture of Scouting and

does not attempt to set out matters

its specific needs help NSOs in two

of policy and procedures of managing

areas:

finances within a NSO as such

• Financial Resources Management

requirements often vary from

• Financial Resources Development

country to country.

In addition to standard financial The need for a guidebook on financial

norms, emphasis is on integrated

resources has been essential based

financial planning as well as on

on feedback from Scout leaders who

financial governance. These are two

attended various workshops on

significant areas which are found

resources development. Given that

lacking in many NSO’s financial

many National Scout Organizations

management. A segment on the why

are endowed with resources, there is

and how of developing and utilizing

an apparent call to develop, enhance

financial assets is featured with

and strengthen what they own, and

examples.

consequently, bring a significant impact on the development and

The Asia Pacific Region appreciates

growth of Scouting.

the initiative of the Financial Resources Sub-Committee (term 2004-

Back in 2003, the World Scout

2007) chaired by Paulus Tjakrawan

Bureau/Asia Pacific Region together

Taningdjaja and Mr Ian Langford-

with the Central Office in Geneva

Brown for editing this handbook.

organized the 1 International st

Resources Development and Management Workshop in Indonesia.

Abdullah Rasheed

Sharing of experiences and great

Regional Director

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Handbook on Financial Resources Management and Development

I. Financial Resources Management

Scouting ( eg down to the Group level) and not just at the NSO level.

Financial Resources Management is

There must always be a clear

the development and implementation

distinction between the funds and

of a range of guidelines and objec-

assets of the NSO and those of each

tives directed towards the financial

individual associated with a particular

growth of Scouting while at the same

Scouting organisation. A simple

time ensuring that the image of

precaution is to ensure that all funds

Scouting is not put at risk. The

and other assets are kept in the

various aspects which are outlined

name of the NSO and not in the

below are designed to meet the

name of individuals.

mission of the Scouting Movement and also comply with the needs and

Financial accountability should be based

requirements of both its members

upon a series of guidelines which have

and the community.

been formally approved by, and adopted for use within each NSO. These

At the same time it provides guid-

guidelines will in turn be implemented

ance on practical steps to take which

through a range of committee structures

not only assist in carrying out the

which have also been approved by, and

financial responsibilities within an

its members appointed by the NSO.

NSO but call attention to activities that do not meet or fall within the

The content of these guidelines serve

NSO’s strategic plan.

a fundamental and basic purpose;

Financial Accountability

namely to set out in simple terms the various steps that are required to be

In Scouting we are dealing with and

undertaken in managing each NSO’s

are responsible for looking after

finances. Examples to be found in

funds and assets which belong to our

these guidelines may include:

members. Accordingly, it is important that we are able to demonstrate both

• How many signatories are required

financial accountability and financial

to operate the NSO’s bank account(s)?

transparency in all aspects of our financial management. It is also

Ideally there should be two signato-

important to appreciate that these

ries out of an approved listing of

obligations apply at all levels of

three or four.

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Handbook on Financial Resources Management and Development

• The process to be followed for the

such investments.

receipt and banking of income.

• How often should financial accounts

This should ensure that the person

be prepared and circulated to

who opens the mail, receives the

members?

money etc does not do the banking.

Audited financial accounts should be

In addition, all funds received should

prepared and distributed to members

be entered into the receipt book and

at least annually.

banked no later than 24 hours after receipt or the next working day..

In addition to establishing guidelines there is the necessity to formally

• Who is authorized to approve

appoint committees who are both

expenditure and is special approval

responsible for implementing the

required for expenditure above a

guidelines as well as providing

specified amount?

guidance and assistance as to their operation. A Finance committee

The Treasurer and other members of

should always be appointed and

the Finance Committee are usually

there are often additional committees

given authority to approve expendi-

for areas such as Investment and

ture up to an agreed amount. All

possibly Insurance.

amounts above that need to be approved by the Finance or similar

Membership of these committees

Committee.

should be comprised both of members skilled in finance as well as a

• In which type of institutions may

balanced representation from the

surplus funds of the NSO be invested

various sections of the NSO. This

and what approvals are needed to

ensures that the needs and wishes of

make such investments?

the NSO as a whole as well as those of each section are considered at all

It is common for the Finance Com-

times. In relation to committees

mittee to specify that surplus funds,

dealing with special areas such as

or funds not immediately required,

investments and insurance it is

should be invested with the NSO’s

advisable to appoint members who

bankers, in building societies, credit

have skills in those special areas.

unions etc. It is usually the role of

On the practical side, and as a first

the Finance Committee to approve

step, there is a responsibility to

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Handbook on Financial Resources Management and Development

ensure that proper books of account

NSO level extends to and embraces

are kept and regularly updated. These

its members, its Region as well as

can usually be simple in format with

WOSM. In other words the NSO has

their level of sophistication growing as

obligations both downwards to its

the level of funds and assets increase.

members and upwards to WOSM.

The keeping of books of account demonstrates accountability for the

In addition, and in special cases

receipt of all funds, the payment of all

where specific funds, trusts etc have

expenses and the acquisition and

been established, it may be neces-

ownership of assets.

sary to also account to parties who have provided funds for specific

The ultimate step is to prepare

purposes.

financial accounts, traditionally at year end, representing all financial

A simple example could be where

transactions during the year as well

someone gives the NSO a sum of

as the financial position at year end.

money to be used to send members

These accounts will not only record

to international Scouting events. In

the financial position but will also

this case it would be appropriate to

provide a record of all assets owned

give, possibly annually, a summary

by, and liabilities due by the NSO.

to that person of which international events were attended, the names of

It is also important to appoint external auditors to conduct an independent

those who went and the cost.

audit of the NSO’s financial accounts

Ethics and Policy

and for these audited accounts to be

Whenever we are dealing with other

presented to the members at the

people’s funds and assets we must

Annual General Meeting. This is a

always honour our ethical position

positive and practical example of

associated with the trust placed in us.

financial accountability as well as

This must also extend to ensuring

enabling all members to see the

that each Scouting Organisation

financial results for the year.

devotes all of its financial resources to the advancement of Scouting

Finally there is the overarching

within its jurisdiction.

requirement for the NSO to recognize that financial accountability at the

Put another way, the question should 11

Handbook on Financial Resources Management and Development

be asked of every proposed com-

traditionally conducted by Scouting

mercial activity “is it one that Scout-

organisations. It may be wise to

ing should engage in”?

check the taxation position in your respective country.

Furthermore, Scouting must ensure that every one of its financial actions

As part of the process of maintaining an

and transactions are conducted and

ethical focus it is necessary for all

constituted in such a way that it always

members having an involvement in the

reflects and enhances its non-commer-

financial affairs of each NSO to give

cial, and usually tax free, status.

appropriate declarations that they have

In some countries Scouting organiza-

no “Conflict of Interest” in any of their

tions come under the broad heading

personal activities with that of the NSO.

of “charitable” entities, not because

When fundraising, seeking sponsorships

they do not need to make money but

or considering partnerships with parties

as a recognition that any profits that

outside Scouting it is essential that you

are made are wholly used in the

study the profile, image and ethics of

conduct of Scouting activities. This

the prospective donors/partners so as to

description, which carries a certain

ensure that their values are not in

kudos within the broad community, is

conflict with those of Scouting.

another reason for being open and ethical in all financial activities.

It is also important that formal guidelines are also implemented

The need to carefully monitor the

setting out the requirement for

various money making activities of

keeping accurate minutes of all

each NSO is becoming more and

financial matters pertaining to each

more important as the Revenue

NSO. These minutes should record

Authorities in some countries are

decisions relating to such matters as

reviewing the commercial activities of scouting and similar bodies with a

• membership of the Finance Com-

view to levying tax thereon. The

mittee and the appointment of its

approach is not necessarily to tax all

Chairperson

of the profits but, at least, to impose

• setting the level of membership fees

tax on the profits from those activi-

• decisions to acquire or dispose of

ties that are seen by the Revenue

assets and/or investments

Authorities as being outside those

• names of the NSO’s bankers, auditor etc

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Handbook on Financial Resources Management and Development

• details of cheque signatories

Having such information to draw

• routines established for the receipt

upon will be of assistance, not only in

and banking of all funds received etc

ensuring that all traditional categories

Integrating Strategic Financial Planning

of income and expenditure are recognized in the budgetary process but that the financial needs of each

Because of the complexities and

section are considered. There should

demands of today’s world, especially

also be an outline of a process to be

in the world of finance, it is important

followed when unusual or “one off”

that each NSO develop and circulate

items are to form part of the budget.

a range of notes and instructions to assist their financial office bearers in

• A check list of the necessary steps

properly addressing the many

to be taken so as to ensure that the

functions associated with their role.

NSO has, and maintains adequate and

The following are a range of sce-

effective insurance for all its assets,

narios which should be addressed:

its office bearers, its members and members of the public who may have

• The relationship and interaction

some interaction with the NSO.

between the NSO’s Strategic Plan and its Financial Plan

In today’s litigious world there is an ever increasing need to ensure that

• A chart of accounts to be used

all of our members and office

throughout the NSO

bearers are adequately covered against any financial claims that are

This ensures that there is a consis-

made against them. It is also impor-

tent approach to the recording and

tant to ensure that all assets and

display of all financial transactions

investments are properly insured and

and those similar items of both

that their insured value is reviewed

income and expenditure are shown

regularly.

under the same headings.

In limited cases “self insurance”, • A process or method to be used in

which is a decision by an NSO not to

developing financial budgets within

insure for a certain risk or part

the NSO.

thereof (eg to cover the first $100,000 of building insurance from 13

Handbook on Financial Resources Management and Development

its own funds) may be appropriate or

• A business plan for the operation

even necessary. If this step is taken

and conduct of any commercial or

then adequate financial reserves

business activity that the NSO is, or

must be in place to meet any claims.

intends to be engaged in.

• A process and policy whereby

Given the increasing need for NSOs

adequate registers are maintained in

to fund their scouting programs from

respect of all assets and investments

a wide variety of activities and

either owned or leased by the NSO.

business ventures it is important that each NSO has in place business plans

In any organization where members

outlining both the concept and

and office bearers are often chang-

method of operation for each activity.

ing, registers such as these may be the only way of remembering or

These may be as simple as practical

knowing exactly where each asset or

guidance on how to operate a

investment is located. It also pro-

business ( such as a Scout Shop, a

vides an ideal check list to ensure

Training Camp, a Hostel etc) or more

that all assets are properly main-

detailed guidance on the acquisition

tained and insured.

of investments ( such as sources of funding, expected returns, cash flow

A similar register of all known or

forecasts etc).

potential liabilities that the NSO may be exposed to is another useful tool

One of the main benefits to be

in developing a comprehensive

derived from developing such

system of financial management

business plans is in providing guid-

within the Organisation.

ance and assistance on possible ways to derive maximum financial benefit

Yet another useful register is a record

from the utilization of business assets

of all contractual arrangements (e.g.

or the conduct of business activities.

to support sponsors etc) entered into ensure that contractual arrangements

Fundamentals of Corporate Governance

are met but they are also met on

While the concept of both Corporate

time thereby enhancing the relation-

and Financial Governance may not be

ship with sponsors.

fully developed in some countries it is

by the NSO. This register will not only

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Handbook on Financial Resources Management and Development

a concept which is being adopted

tees be established and that both the

quite quickly in many countries.

composition of its members, and their roles and duties are formally

As a result of the ever growing require-

established.

ments flowing from these areas of Governance it is important to anticipate

• It is important that an independent

their requirements and incorporate

audit of the NSO’s financial position is

aspects such as the following as part of

conducted at least annually.

each NSOs preparations for financial management.

It is highly desirable that an open tender process should be used for

A number of these aspects are also

the supply of all financial services to

addressed in other segments of this

and within the NSO (eg banking,

Handbook:

insurance, investment advice, audit

• The financial resources of each

services etc).

Scouting Organisation must be totally applied for, and directed towards the

Budgeting

advancement of Scouting in each

As mentioned above budgeting is an

jurisdiction.

integral part of successful financial

• All the financial resources and

management and the level of detail

assets of each NSO must be kept

required will depend upon the volume

completely separate from those of its

of financial activities as well as the

individual members.

complexity of the activities involved.

Moreover, it is important to appreci-

• Appropriate levels of financial

ate that some form of budgeting is

accountability and responsibility must

important at all levels of Scouting. To

be established at all levels through-

illustrate, a budget for the NSO will

out each NSO.

be far more complex that that required by a local Cub Pack or

• The division of financial duties and

Scout Troop. The NSO’s budget needs

levels of financial responsibility within

to cover all aspects of its operation

and without each NSO must be

while the local Cub Pack etc only

formally established.

needs to ensure that it has adequate funds to run their weekly activities

• It is essential that Finance Commit-

and to pay their own bills.

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Handbook on Financial Resources Management and Development

the budget period needs to be When preparing a budget the following

identified and considered as well as

is an outline of many of the compo-

expected returns from any projected

nents that need to be considered:

sales of capital items.

• To identify all categories of known

Not only are there revenue and

and potential sources of income.

expenditure considerations arising from such transactions themselves

These will range from membership

but any reductions in income arising

fees; returns from investments;

from using investments to fund these

surpluses from business activities;

transactions must be allowed for.

fund raising; sponsorships; donations;

• The budgeting process must take

grants from (government) bodies;

into account the financial aspects of

surpluses from Jamborees etc.

any strategic plans; major events such as jamborees and the initial funding

• At the same time it is necessary to

needs of special/one off projects.

identify all known and potential items of expenditure.

In events such as these funding may only be of a temporary nature (ie the

Not only will these include normal

funding may be refunded from future

running and operating expenses such

activities) but there may also be

as postage and telephone; adminis-

“unusual” expenditure which is not

trative salaries; traveling costs;

normally encountered during the

insurance; printing and stationery etc

budget process.

but it will also include costs of maintaining training facilities;

• An important component of any

business premises and meeting halls.

budget documentation is the preparation of a cash flow statement for the

• There must always be consultation

budget period.

with each section of the NSO to ensure that both their income

This document ensures that periods

expectations and their expenditure

of tight liquidity are known in ad-

needs are known and discussed

vance and appropriate arrangements

before the budget is completed.

made to cover any cash shortfalls.

• Likely capital expenditure during 16

Handbook on Financial Resources Management and Development

• The final step is to have the budget

audit should be conducted on a

discussed, amended where necessary

regular basis and should be conducted

and then approved by both the Finance

at all levels of financial responsibility

Committee and the NSO’s Executive

with each NSO. Not only will such

Committee. The final budget docu-

internal audit supplement the inde-

ments should then be submitted to the

pendent audit but it should also

members for their approval before the

provide an early indication of any

budget period commences.

problems that have arisen or areas

Audit

where assistance may be required

In most countries there is a

Insurance

recognised auditing profession and

In today’s world insurance has

the audit of each NSO’s finances and

become such an integral part not

their financial activities is a statutory

only of our daily lives but is also an

requirement. Even if an audit is not

essential part of financial manage-

formally required it is strongly

ment. This is not only a reflection of

recommended that a full audit is

our litigious society but also a

conducted, at least annually, by an

recognition of the increasing sophisti-

independent party.

cation which has developed and been embraced by insurance companies

It is recommended that some form of

around the world.

audit be conducted at all levels within an NSO as not only does it provide a

Therefore the first step that each NSO

level of protection for the person(s)

should take is to find an insurance

looking after the finances but it is

broker who both understands the role

also a key measure in ensuring both

and various activities of a Scouting

the proper application and transpar-

Organisation and who also has an up-

ency of all finances and assets within

to-date, working knowledge of the

the NSO.

insurance industry. It may take a while to find the right party but be

In addition it is strongly recom-

assured that it will be time well spent.

mended that each NSO implement an appropriate process of internal audit,

It is also important to remember that

i.e. a measure of review and control

as insurance is such a specialized

conducted by the NSO itself. Internal

area the appointment by the NSO of 17

Handbook on Financial Resources Management and Development

an Insurance Committee would be appropriate. The members of the

• Ensure that all members and office

committee would include people with

bearers are covered for appropriate

knowledge and skills in insurance and

risks as well as the level of insurance

may well include your insurance

cover being adequate.

broker. If the insurance broker is not appointed as a member of the

• Ensure that all assets, owned or

Insurance Committee then the broker

leased by the NSO, are properly and

should attend all meetings of that

adequately insured. In addition, it is

Committee as an advisor.

necessary to ensure that all parties who may have an insurable interest ( eg in

In partnership with your insurance

respect of equipment which has been

broker you can then proceed to

lent or leased to the NSO) are properly

undertake a review of areas such as:

recorded on the insurance policy.

• The type of risks that need to be

• If the NSO undertakes any business

insured against.

or commercial activities then ensure that full an adequate insurance cover

• Ascertain what statutory classes of

is in place including insuring the

insurance each NSO is required by

people who work there as well as

law to carry.

customers.

• Determine whether the NSO is financially able to carry any level of

• Ensure that a complete and up-to-

“self insurance” and, if so, what

date asset register is maintained

would be the appropriate areas of

thereby providing a basis of ensuring

insurance in which to “self insure”.

that all assets are insured.

Some NSOs have been able to “self

• Ensure that a regular program of

insure” some part, say the first

asset maintenance is in place as this,

$100,000, of their building insurance.

of itself, provides a measure of asset

This being possible because the NSO

protection.

has adequate financial resources to

• Ensure that all/any people who are

meet any such claim while, at the

not members of the NSO, such as

same time, having a good claims

tradespersons, business customers,

history in relation to buildings.

people hiring scouting facilities etc

18

Handbook on Financial Resources Management and Development

are covered by appropriate and

Investments

adequate insurance.

Types/Categories Today, many NSOs will have acquired

As will be apparent from the above,

assets as a means of enabling them to

insurance is a specialised business

deliver the Scout Program. The

and in order for each NSO to be

majority of assets are likely to be

adequately and comprehensively

owned, either directly by the NSO or

covered it is essential to use a skilled

by some related party. However, some

and competent insurance broker. In

may be either leased (eg for a period

addition, it is essential that regular (at

of years) or subject to some other

least annual) reviews of all insurance

form of restriction as to use or tenure.

needs are carried out and, where necessary, insurance policies updated

These assets will include some which

and the level of insurance increased.

simply provide the setting for the conduct of Scouting while others will

It should not be forgotten that

be income producing. Common

Scouting has its own, inbuilt form of

examples include:

insurance protection, namely the development and implementation of

• Land and Buildings – such as scout

proper Risk Management practices

halls; campsites; headquarters;

and procedures. Scouting has a

training centres and centres providing

proud history of managing risk

accommodation for various courses.

whether it is in planning its adventurous activities or producing check lists

• Equipment used for Scouting

for scout hall maintenance.

activities – including sailing craft; aircraft; climbing and abseiling

It is therefore important that both

towers; flying foxes and “challenge

your insurance broker and your

course” equipment.

insurance company is fully briefed on the extent of your Risk Management

• Motor vehicles and office equipment.

procedures and practices as this knowledge should be beneficial in

• Income producing investments such

terms of the amount of premiums

as stocks and shares; funds on

paid and the levels of insurance

deposit etc.

cover obtained.

• Investments in scouting business 19

Handbook on Financial Resources Management and Development

activities – including scout shops;

made at the appropriate level of

training centres; hostels etc

authority within each NSO.

• Investments in non-scouting business activities – such as collect-

Another very important criteria is to

ing aluminum cans; manufacturing

carefully consider whether or not the

honey, growing fruit and vegetables

proposed investment is one that

and investments in media.

Scouting should be involved in. This

• Investments in business partner-

has implications both as to the

ships with outside parties including –

perceived image of scouting by the

running staff development days for

general public as well as potentially

corporations; working with govern-

influencing the attitude of govern-

mental agencies on environmental

ments and corporations towards

projects; provision of refreshments

providing assistance to Scouting.

to those attending non-scouting activities eg corporate functions.

Having made the fundamental decision to invest there are a number

This is another aspect of financial

of other factors which must now be

management where its own commit-

considered before the final decision

tee, an Investment Committee may

to proceed can be made. These

be advisable. This would depend

include:

upon the level and complexity of the investments and if such a Committee

• Develop a business plan to deter-

was appointed then its membership

mine whether or not the investment

would include people with good

will be financially viable.

investment skills as well as represen-

In relation to investing in financial

tatives of the Finance Committee.

products such as cash on deposit, debentures etc the financial viability

Decisions to Invest

will be readily apparent.

The availability of financial resources couple with a commonsense approach

However if the proposed investment

to the suitability of any proposed

is a business opportunity you will

investment are always important

need to consider issues such as

criteria involved in making investment

customer needs and competition;

decisions. That is not forgetting that

sourcing and supply of materials;

all investment decisions must be

cost and availability of the required

20

Handbook on Financial Resources Management and Development

finance; location of business pre-

ance policies are in order

mises etc.

• Ensure that the Scouting In addition you need to ensure that

Organisation already has, or can

the product can be offered at a

readily obtain the necessary skills

competitive price, one that produces

and people that will be required to

a profit.

fully run and manage the investment.

• As part of the business plan you must develop cash-flow models to ensure that the proposed investment will generate an appropriate return of income to justify the investment.

• Check to ensure that the price to be paid for the investment is reasonable.

• This will involve having the investment proposal reviewed by someone with appropriate skills and experience; calling tenders to establish prices for the supply of product; comparing market values etc.

• Consider any legal aspects associated with the purchase.

It will be important to engage a lawyer to undertake various searches and enquiries to ensure that you will be able to obtain clear title to any property being acquired; that any governmental etc zoning requirements can be complied with and that all necessary permits can be obtained.

• Ensure that all appropriate insur21

Handbook on Financial Resources Management and Development

II. Financial Resources Development

source. The benefits to an NSO of having funds available are twofold.

There is a positive demonstration of

The financial strength of any organi-

the development of a resource, the

zation, in our case the NSO, depends

generation of income, as well as the

to a large extent upon the various

creation of an additional resource,

resources which it either owns or

namely cash.

which are available to it. It is from the development and utilization of

This section of the Handbook seeks

such resources that an NSO is able to

to illustrate various ways, including

generate income as well as providing

steps that can be taken, to fully

and maintaining the facilities needed

develop the various resources

for its successful and continued

available to an NSO. In so doing the

operation.

resources have been divided into two broad categories – internal and

The range of resources available to an NSO comes in many forms. Not

external.

only do they include tangible assets

Internal Resources

(such as land and buildings; invest-

A. Membership Fees

ments and similar assets) intangible

Membership fees are one of the most

assets such as Intellectual Property

readily available forms of income

but they also include its members

available to any NSO. It is traditional

and its supporters. The ability,

for anyone who is a member of an

ingenuity and willingness of these

organization, be it a sporting club, a

people to work towards enhancing

professional body, a theatre club etc

the financial strength of an NSO can

to pay membership fees. The same

often be the key to generating or

rationale applies in Scouting.

developing its required level of resources.

We should always remember that BP himself, when organizing the first

When thinking about the develop-

experimental camp for 20 boys on

ment of financial resources it should

Brownsea Island, charged a token

not be overlooked that the receipt of

fee to each boy as he believed that

income is, in its own right, the

anything free will not be appreciated

gaining or development of a re-

by the receiver.

22

Handbook on Financial Resources Management and Development

The challenge is, of course, to

Section); seeking sponsorship; using

determine the correct level of

profits from business or commercial

membership fees to apply at any

activities etc. Whatever the means

point in time. This is an important

there is always the possibility of a

part of resource development as it

benefit accruing to Scouting from

requires regular and careful monitor-

such fundraising especially if the

ing to ensure that the fees remain

relationship with the external party

affordable. However, at the same

providing the funds is strengthened,

time, it is important to keep in mind

thereby enhancing the image of

that the level of membership fees

Scouting.

should also reflect the value and benefit which membership of Scout-

B. Property Development

ing confers on each member.

Many National Scout Organizations (NSOs) own land and buildings which

Accordingly, when producing a

they may be able to use to generate

budget, there is always a logical

income. These are valuable assets

nexus between the number of

and should be properly managed so

members and the amount to be

as to maximize the amount of income

received from membership fees.

which can be generated for the benefit of the NSO. The value of the

While the focus will be on the quan-

property to the NSO, as well as how

tum of the fee this does not auto-

it can best be used to generate

matically imply that they will be

income, will often depend upon a

actually paid, in part or in full, from

range of factors such as:

the member’s own funds. The

• the location of the property;

obligation to pay remains with the

• its size (area);

member but the source of the funds

• the facilities available or the scope

becomes part of the development

of facilities to be developed; and

process associated with this re-

• any specific conditions, restrictions

source.

etc which may be embodied within, or specified in its title deeds or other

The challenge then becomes how

legal documentation relating to the

best to fund (develop) this resource.

property.

Possibilities include fundraising by the member or their local Group (or

For example, if the property is 23

Handbook on Financial Resources Management and Development

situated in an urban or a commercial

moved or modified and new docu-

area it may well be suitable for the

ments of title issued. This is impor-

construction of commercial buildings

tant not only in ensuring that the NSO

such as hostels, hotels, offices or

has the legal right to begin the

shops. If it is located in a suburban/

development but also because the

residential area it may be suitable for

title deeds will often be the key

residential housing and if it is situated

document under which finance for the

outside the township/city limits it

development will be obtained. i.e. by

would probably be suitable for a

way of mortgage, collateral etc.

Camp Site; a Training Centre or an Activities Centre.

The optimum is to have a “win/win� situation whereby the NSO achieves

The first step before proceeding to

its target of obtaining the necessary

the development stage is to under-

funds to complete the development

take a detail study/search of the

within a nominated time frame and is

documents or title deeds pertaining

also able to complete all necessary

to the land especially to ascertain

searches and reviews to ensure that

whether they contain any restrictions

all risks are minimized.

that may apply to or govern its use.

This is essential as any specific

B.1 Property Development

conditions in the title deed for the

Committee

land must be complied with or, as is

An initial part of the development

sometimes appropriate, an official

process is to create a Property

request can be made to the appropri-

Development Committee which

ate authority seeking to have these

should be established at the com-

restrictions either removed or

mencement of the development

modified. It is often the case that

project. Membership of this Commit-

with the passing of time, changes in

tee should include people skilled in

an area’s demographics etc restric-

finance, contract management,

tions made in the past may no longer

architecture and property develop-

be appropriate.

ment as well as having an appropriate mix of uniform members and

In any event it is important that no

non- uniform (lay) members. It is

development is commenced until any

critical, in the interests of good

restrictions have either been re-

governance and transparency, that

24

Handbook on Financial Resources Management and Development

none of the members of the Commit-

ity study include:

tee have a personal interest in any part of the development.

• production of site plans and architectural drawings;

Should the development be of a size

• preparation of cash flow forecasts,

that warrants it, specific sub-commit-

costing and financial modeling;

tees such as Finance and Project

• consideration of potential revenue

Management could also be estab-

projections etc

lished. as such information is needed to give In addition, it is essential that a

the Committee both an overall

reputable legal firm be engaged to

picture of the financial viability of the

attend to all the legal aspect of the

project while also assisting it to make

project. Furthermore, before the

appropriate decisions relating to the

proposed project gets underway the

project.

Committee should engage a skilled consultant to undertake, and provide

The method of financing the project,

them with a feasibility study of the

as well as the level and source of

overall project. The feasibility study

finance are all important decisions.

will, as indicated below, be a key

Aspects to consider will include

reference document as the project

whether the NSO is able to undertake

progresses.

the project on its own or whether it is necessary to seek a partner(s) to

It is important to appreciate that

participate in the project and if a

undertaking the various steps

partner is required what contribution

mentioned above are just as impor-

will be required from that partner;

tant to the development of a new

who should be approached to provide

camp site as they are to the building

the necessary finance; the term of

of (say) a hostel complex. Each step

any borrowings; what security will be

is vital in ensuring that the NSO gains

required by the lender etc.

the maximum benefit both from the

In some instances it will be appropri-

asset as well as its development.

ate for a project to be undertaken together with another party. Reasons

B.2 Feasibility Study and Finance

for such a decision could include the

The various components of a feasibil-

need to secure certain skills such as 25

Handbook on Financial Resources Management and Development

marketing; sources of supply;

will traditionally flow from:

ownership of trade marks and other

• Sale(s) of property

industrial property or access to

• Renting the property for extended

favourable funding. If a decision is

periods;

taken to join with another party then

• Renting the property for short

legal advice will be required to draw

periods (workshops, seminars, social

up an appropriate joint-venture or

and corporate functions); and

partnership e agreement, one which

• The provision of short term accom-

ensures that the rights and responsi-

modation (renting rooms in a hostel,

bilities of each party are adequately

hotel etc).

protected.

To achieve the desired outcomes It is also necessary to ensure that

from each of the above categories

when choosing a partner the party

requires the involvement of people

chosen is reputable, trustworthy; and

with both experience and specific

well regarded as we must always

expertise. It is therefore important to

protect the image and reputation of

engage professionals, be they

Scouting and ensure that our high

members of the NSO or otherwise, to

ideals are maintained.

undertake each of these activities or, if necessary, to contract them out.

Once all the preliminary issues have been addressed and a decision taken

Whatever step is taken it is important

to proceed, appropriate tender

to ensure that there is a suitably

documents will be prepared and

drawn contract between the NSO and

issued. The decision as to which

the party providing the service.

tender to accept should be made by the Committee, and this decision

Successful NSOs in Hostel Develop-

should be endorsed by the NSO.

ment and Management in the Asia-

However it is important to recognize

Pacific Region:

that, for any of a number of reasons,

• Hong Kong Scout Association

the cheapest tender may not always

• Persekutuan Pengakap Negara

be the one best suited to the NSO.

Brunei Darussalam on Office, Shop Houses and National Headquarters

B.3 Sales and/or Rental of Property

Project.

Revenue generated from property

• Bangladesh Scouts Association on

26

Handbook on Financial Resources Management and Development

Development of National Headquar-

attendance at the camp is fun and

ters Building

exciting. In some countries open fires are not permitted and accordingly, in

B.4 Scout Camps

those locations, it will also be neces-

Development and Operation

sary to provide proper kitchen

of a Scout Camp

facilities for meals and refreshments.

As an opening remark it is recommended that in relation to the initial

All activities, courses etc must be

development, or any major extension

under the guidance, and supervision,

of a Scout Camp, NSOs follow the

of qualified instructors and facilita-

various steps and procedures set out

tors. This is a requirement not only

above in relation to “Property

for insurance and safety purposes

Development�

but should be part of every NSOs Risk Management processes and

Camping is synonymous with Scout-

procedures.

ing thus every NSO has a camp site.

Differences are traditionally only in

Depending on the location, nature

terms of size or location. Never-the-

and purpose of the camp site (is it

less every Scout camp needs to be

just for camping or is it also designed

properly maintained, and upgraded

to appeal to the corporate market)

on a regular basis, so as to ensure

there may be a need to provide

that it remains a successful centre

various standards of accommodation

and one that continues to attract not

as well as conference facilities.

only Scouts but the general public.

Developing a camp site to this extent

This enables many people to enjoy

will also benefit the NSO by providing

what it has to offer as well as

a suitable training venue for leaders

providing an excellent setting in

and a location for the holding of

which to experience life in the

meetings. In addition it will also act

outdoors.

as an incentive for parties who are not members of the NSO to hire the

Scout camps must not only provide

camp thereby providing an additional

open areas for camping and outdoor

source of income for the NSO.

activities but they must also have a range of properly supervised activi-

The availability of challenging

ties and challenges to ensure that

activities within the camp site will 27

Handbook on Financial Resources Management and Development

also add to its appeal not only to the

Successful NSOs on Camp Sites in

various Scouting sections but also to

the Region:

the corporate world and the commu-

• Gerakan Pramakua

nity in general All such activities

Indonesia

Bumi Perkemahan Chibubur

provide not only fun and excitement

•The Bharat Scouts and Guides India

but they assist in team building, self

• Bangladesh Scouts

confidence and motor skills.

C. Scout Supplies An innovative and efficient Camp

Providing Scouting supplies is a

Warden, supported by good manage-

service which many NSOs offer to its

ment and maintenance teams, will

members and it embraces the

keep the camp site attractive and

production or purchase of a range of

able to offer good programs through-

merchandise which is offered for sale

out the year. Support of this nature

to its members. Traditionally this

will ensure that the camp site is

service does not run at a loss and is

popular, not only with Scouts but also

often a profit centre for the NSO.

with non-Scout users. It should be able to generate a good source of

A NSO may decide to run its scout

revenue for the NSO thereby provid-

supply service in its own right or it

ing funds to adequately reward the

may choose to provide this service

staff as well maintaining and upgrad-

through some form of commercial

ing the camp site.

arrangement, such as a franchise, or through an associated entity such as

The gross rental received by a camp

a Scout Foundation. Irrespective of

site will naturally depend on its

the method of operation the key

usage. At the same time it is usual to

decisions such as pricing, quality

offer priority bookings and lower

control etc relating to the scout

charges to members of the move-

supply service should remain with the

ment as compared to those charged

NSO. Ongoing monitoring of this

to the public. A professionally

service should be undertaken by a

produced brochure advertising the

separate committee, such as a Scout

camp and highlighting its facilities

Supplies Management Committee,

should be developed and widely

with designated powers which should

circulated.

extend to the managing of the surplus funds derived from the

28

Handbook on Financial Resources Management and Development

service.

and success and the overall business must be administered professionally.

As part of the initial decision making process there are a number of steps to

As part of the process of deciding

be undertaken to enable a full assess-

whether to open one or more shops

ment of the proposed service while, at

the NSO must evaluate the size of its

the same time hopefully identifying,

membership as well as undertaking a

and protecting against, any risks that

feasibility study covering the poten-

are likely to arise such as:

tial sales volume, sources of supply, the anticipated costs of operation etc.

• Undertaking an overall feasibility

This information can then be used to

study of the proposed Scout supply

develop a business case as to the

service

viability of opening a Scout shop as

• Ensuring that competent manage-

well as indicating both the number

ment is available to operate the

and location of shops that will be

service

required.

• Preparing financial models of the proposed service

NSOs may choose to establish their

• Reviewing any existing competition

shop(s) within their Headquarters as

• Determining an appropriate

both a cost reduction measure as

marketing strategy

well as being a convenient location for its members. Headquarters in

C.1 Scout Shops

other locations such as Regions or

Many NSOs provide this service

Districts can operate as agents for

through their own scout shop(s)

the Scout shop(s).

thereby offering a facility where members can purchase their uni-

C.2 Stock Control and

forms, badges, publications and a

Management

range of Scouting paraphernalia

The financial success of a Scout shop

under the one roof.

depends on a number of factors including a sound business plan, good

If it is decided to operate a Scout

governance, proper management of

shop it must be treated as a busi-

stock, transparency in their opera-

ness. Ideally it will have full time

tions as well as sound financial

staff dedicated to its management

controls.

29

Handbook on Financial Resources Management and Development

Stock control is a key element and

product range is usually categorized

before commencing operations the

into “essential” and “non-essential”

management has to source reliable

items and lower profit margins are

manufacturers who can guarantee

traditionally applied to those desig-

timely delivery of high quality

nated as essential items. Essential

products at reasonable prices. It is

items will include uniforms, badges

also advisable to establish good term

and often publications and the sale

of credit either with the manufactur-

price of these items will be set so as

ers or the NSO’s financiers. Good

to cover the cost of sales with

stock control is also essential and a

possibly a small contribution towards

minimum level of supplies must be

administrative costs.

maintained at all times. Given that there is often a large range of stock

Higher profit margins will be applied

items, often including ones of low

to the non-essential items, such as

value, the shop manager must

camping gear, wet weather gear and

ensure that stock records are

souvenirs so as to generate a surplus

maintained and regularly updated.

from the operation of the shop. Such items are often sold to people who

C.3 Products and Pricing Policy

are not members of Scouting and for

While the range of items carried will

the benefit of members it is not

vary the following are commonly sold

uncommon for such goods to be sold

in Scout shops:

at different prices, one price for members and one for non-members

• Scout uniforms

with a membership card being used

• Scouting badges, awards and

to identify members. This is normally

decorations

expressed as a percentage discount

• Scout publications

being available to members.

• Jackets, wet weather gear and camp shirts

As part of the pricing policy prices

• Camping gear including tents,

need to be reviewed regularly so as

backpacks, sleeping bags and

to reflect changes in the cost of sales

cooking gear

and the market situation generally.

• Souvenirs and handicraft items

Obsolete, slow moving and dead stock should be cleared out, possibly

In determining a pricing policy the 30

on an annual basis, by selling at

Handbook on Financial Resources Management and Development

discounted prices on occasions which

acumen, as well as people skills to

are widely publicised. New items or

both manage the business as well

product lines may be introduced to

guiding and supervising other staff

members by offering, well publicised,

members.

special promotional discounts.

C.5 The Concept of Service C.4 Staff Competence

When it is decided to commence

The competence of the staff involved

business there will always be an

plays a critical role in the success or

element of risk. One common area of

otherwise of a scout supply service

risk is competition and Scout shops

and it is vital that the Management

often have to compete with other

Committee responsible for the

shops that sell items that are not

service comprises members of the

Scouting’s propriety products, such

NSO as well as business people who

as camping/outdoor equipments and

are familiar with market situations as

accessories. Competition can often

well as operating in a retail environ-

be a matter of price and in times of

ment. While it is often difficult to find

price competition the deciding factor

staff to work in a small business

may be as simple as the service

environment, and while it is desirable

provided by the staff. A warm smile

to employ people who have retail

and a polite manner are simple yet

sales experience, members of an

very effective tools.

NSO are often willing to try and can be provided with on-the-job training

While profit is an integral part of the

so as to ensure that they are

operation there will be times when

equipped with ample product knowl-

service to both the members and the

edge and customer service skills.

NSO may be the appropriate decision

This is one area in which the mem-

to take.

bers of the Management Committee can contribute.

Successful NSOs in Scout Supplies in the Asia-Pacific Region:

The key staff member is the Shop/

• Hong Kong Scout Association

Service Manager and in addition to

•Scout Association of Japan

having a background in retail selling this person needs to have the necessary business and financial 31

Handbook on Financial Resources Management and Development

D. Endowment Funds and

special terms and conditions are to

Foundations

apply to the income derived by these

Many NSOs are fortunate in having

funds.

such a dedicated resource, or a similar source of funds, the income of

An associated step is to appoint a

which is to be used by or applied for

group of people, either as Trustees or

the benefit of the NSO. In most cases

as a Committee, to administer the

it is only the income of the fund that

Fund. If the Fund was created by way

is available to the NSO thereby

of a bequest or gift the party provid-

ensuring that the capital is main-

ing the funds should be represented

tained and continues to be available

otherwise those appointed should have a strong affinity with Scouting in

The development of such a resource

general as well as the NSO con-

should be considered at three distinct

cerned.

levels: Having established the Fund, an • The creation of the Fund;

ongoing requirement should be to

• The maintenance of its capital

maintain its capital base. A simple

base; and

way to achieve this goal is to limit the

• The growth of its capital base

distribution of income each year by

• each of which have as its primary

retaining within the Fund an amount

aim the building of a financial asset

of income calculated by reference to

which provides an income stream

the inflation rate. This increases the

dedicated to assisting the NSO in

capital base so that each year it

delivering the Scouting program.

equals the amount of the original capital adjusted to reflect all in-

The initial funding can come from a

creases in inflation since that date.

variety of sources such as a bequest; a fund raising campaign or surpluses

The optimum development technique

arising from a major event such as a

is to undertake regular fund raising

Jamboree. Whatever the source, the

exercises to increase the capital base

next steps are to ensure that the

and thereby providing a greater

funds are separately maintained

income stream for use by the NSO.

away from the general funds of the

However, careful thought should be

NSO while also ascertaining what

given, before any new funds are

32

Handbook on Financial Resources Management and Development

raised if only to ensure that the

Potential answers would include

additional income generated can be

seeing this event as:

readily and beneficially used by the

• an opportunity to raise funds, from

NSO. The point being that sometimes

the event surplus, for the future

the terms and conditions governing

benefit of the NSO; or

the use of income derived by a

• an opportunity to raise funds for

particular Fund may be unduly

the development of a specific asset

restrictive.

such as a camp site • and in these situations funds can be

If such restrictions exist, or are likely

raised, for example, by including a

to arise, then the focus of any fund

special levy in the event fee or, as an

raising should be undertaken in

ongoing practice, include a small

another, more flexible vehicle so as

“development” amount in the course

to gain maximum benefit to the

fee for every training course held by

specific needs of the NSO.

the NSO. • an ideal opportunity to develop an

E. Events

ongoing financial relationship with a

Suitable events that are either large

major sponsor

enough, or important enough, to

•an example would be to grant

warrant inclusion as part of an NSO’s

naming rights, for a specific period,

financial resource management

in respect of nominated events

program are not likely to occur every

• an ideal opportunity to enter into an

year. Never the less certain events,

ongoing partnership(s) with suitable/

such as Jamborees fall into the

logical partners

category of “major” events and these

• such as with a tent manufacturer

should come within any resource

whereby the NSO agrees to sell their

management program.

tents in their Scout shop and the

When considering the development of

manufacturer provides a number of

financial resources associated with

free tents at Jamboree time.

major events a key question to be

• a promotional opportunity to

answered is

enhance the image of Scouting

“What are the financial aspect(s)

• whereby the NSO agrees to raise

associated with this particular

funds for a charity and, in return,

resource are we interested in

receives appropriate publicity.

developing?”

33

Handbook on Financial Resources Management and Development

Having decided which areas to focus

jurisdiction. Each NSO has the ability

on enables the NSO to determine

to use these resources to improve its

what steps are required to obtain the

finances. A possible way of fund

best financial outcomes from a

raising would be to grant a license to

particular event. In so doing the NSO

an acceptable, from a Scouting

will gain assistance from other

perspective, party to pay a royalty

aspects of financial management and

for the use of a (trade)mark, training

development outlined elsewhere in

publications etc which have been

this Handbook. Topics to consider

properly registered.

would include “Fund Raising”; “Partnerships” and “Project Manage-

Further information can be found in

ment”.

the recent publication “Guidelines for the Protection of Intellectual Prop-

F. Intellectual Property

erty”.

Scouting is fortunate in that it has available to it a range of valuable

G. Business/Commercial

Intellectual Property which can be

Activities

developed to enhance the financial

Entering into business or commercial

position of many NSOs. While

activities has never been regarded as

Intellectual Property is a resource

a major part of Scouting activities.

which has not been greatly utilized

Certainly many NSOs operate Scout

within Scouting it is one that should

shops, rent out camp sites, sell

not be overlooked.

publications and possibly license Intellectual Property and these will

Common examples include:

continue to be part of traditional

• emblems (the National Scout

Scouting activities.

Emblem and the National Scout Badge)

However it is a significant step, and

• registered (trade) marks

one only to be taken after careful

• designs

consideration of the many potential

• training programs

risks that may be encountered, for

• publications

any Scouting organization to under-

and provided that each item of

take, or enter into any form of major

Intellectual Property is properly

business or commercial activity.

registered and protected in its 34

Handbook on Financial Resources Management and Development

There are certainly a range of

External Resources

successful activities being conducted

This section focuses on specific areas

by NSOs such as raising cattle,

of developing financial resources and

collecting and bottling honey, building

should be read together with other

hostels and shopping complexes and

sections such as Fund Raising and

collecting and crushing aluminum

Partnerships.

cans. No doubt other possibilities will present themselves to many NSOs.

Government Grants The obtaining of grants from Govern-

In other sections of this Handbook we

ment will be easier for some NSOs

have provided some guidance in

than others. Furthermore, it may be

areas such as financial accountability,

easier to obtain grants from some

ethics, strategic financial planning

levels of Government, or some

and corporate governance and each

Governmental Departments than

of these must be carefully considered

others. There may be many reasons

before deciding to participate in any

for this such as:

business or commercial activity. • The relationship between a NSO Once a decision has been taken to

and a particular Government;

enter into an appropriate activity the

• Whether the Government has grant

next step should be to undertake

funds available; or

feasibility studies and due diligence

• The use to which available grants

reviews. These steps should be part

can be applied.

of the overall process to enable you to be satisfied, as best you can, that

The number of levels of Government

the proposed activity will provide a

can vary between countries as in

safe financial return to the NSO.

some countries there will be up to three levels while in others there

Another important step, before a final

may only be one or two. When there

decision to proceed can be taken is

are different levels of Government

to obtain approval from your NSO to

there are usually specific areas of

proceed, especially as both the

responsibility assumed at each level

image of Scouting as well as the

(eg one level may be responsible for

financial security of the NSO is at

education and training while another

stake.

may be responsible for sport and 35

Handbook on Financial Resources Management and Development

youth, recreation or small grants to

NSO.

business).

Therefore an important step is to

It should also be recognized that

ascertain details of all grants that are

when grants are received appropri-

available, which areas of Govern-

ate, public recognition must be given

ment provides the various grants as

to the Government making the grant.

well as the relevant criteria under

Also, in certain instances the best

which grants may be made.

interests of both the Government and the NSO may be served by working

Having ascertained this information

together to achieve the desired

the NSO should determine which

outcomes from obtaining the grant.

grants they will apply for and commence to prepare the necessary

The following examples illustrate a

application(s). At the same time

range of grants that have been

enquiries should be made as to any

received by various NSOs:

personal contacts that may be available to the NSO to assist in

• A grant for the long term develop-

receiving a favourable response to

ment of Scouting (youth develop-

the various grant applications.

ment).

At a practical level, grants are more

• A grant to enable each Scout Hall in

likely to be received if they are

a NSO to install water tanks, thereby

made, or followed up at a personal

assisting to preserve water.

level. This will assist the NSO in the following ways:

• A grant to work with indigenous people, in remote areas, to introduce

• It will enable the NSO to receive

the Scouting program to those

guidance on how to frame the grant

people.

application and who the application should be forwarded to; and

• A grant to meet the annual costs of both activities for youth members

• It will be the person responsible for

and Leader development courses.

approving grant applications to have a greater awareness of the needs of,

• A grant to cover annual operating

and areas of expertise within the

expenses.

36

Handbook on Financial Resources Management and Development

• A grant to assist in celebrating the

deductible which is of considerable

Centenary of Scouting.

assistance when NSOs are seeking financial support.

• A grant to assist in developing international relationships and

NSOs may seek donations in different

friendship.

ways. One approach may be to have

• A range of small grants to enable

a major campaign at periodic

Scout Groups to acquire computers

intervals – say every three years -

or other small items of equipment.

directed towards both the corporate world as well as high wealth individu-

Applying for grants, and developing a

als which are conducted at periodic

good working relationship, including

intervals – say every three years.

developing partnerships, with all

These campaigns are often focused

levels of Government is a positive

around specific needs (e.g. to

way of developing financial re-

develop a new camp site) or to

sources.

provide a major source of funding for

Donations and Sponsorship

particular activities (e.g. to provide

Both donations and sponsorship are

Leader training).

important sources of funding for NSOs and are areas where time and

Another approach is to establish an

resources can be usefully deployed.

ongoing donor program whereby people become members of a

It is recommended that efforts in

specially created fund and the

these areas be coordinated under

members commit to making regular

specially created committees whose

donations, usually on an annual

members have skills and expertise in

basis, of varying amounts. The net

these forms of fund raising. It is also

income of this fund is distributed in

recommended that these activities be

accordance with pre-determined

coordinated at the NSO level so as to

guidelines.

maximize effort and to minimise duplication in approaching potential

Every NSO has a need for increasing

donors and sponsors.

its financial resources and accord-

In some countries donations and

ingly is important that all NSOs have

sponsorship contributions to organi-

in place a strategy and a focus

zations such as Scouting are tax

directed towards seeking donations.

37

Handbook on Financial Resources Management and Development

It is an activity that should be

strong, ongoing relationships, be they

ongoing and undertaken at all levels

“partnerships” or other arrange-

within an NSO.

ments. It must also be appreciated that, in today’s financial climate,

Sponsorship may well be associated

business will only sponsor organiza-

with major Scouting events such as

tions such as Scouting if they see

jamborees which provide ideal

that they are receiving something in

opportunities to develop ongoing

return. This will be a matter of

relationships. These relationships can

negotiation in each individual case.

be established for the supply of a wide range of products and services

Special Events

from food and soft drink, paint and

As the name implies “special” events

maintenance items, use of motor

do not occur regularly and should

vehicles and computer equipment to

only be conducted in conjunction with

providing a fully equipped and staffed

a significant fund raising event. It is

hospital.

important to appreciate that it is easy to annoy potential donors, especially

However sponsorship is certainly not

major donors, by continually ap-

limited to major events and can be of

proaching them for funds.

considerable benefit through all levels of Scouting. For example, at

A recent example of a special fund

the Group level a local business may

raising event was one organized to

provide camp shirts while at a higher

raise funds to rebuild a large camp

formation the ongoing use of a motor

site which was completely destroyed

vehicle(s) may be negotiated.

in a bush fire. Being in aid of a very good cause, permission was obtained

When developing relationships with

to hold the main fund raising event in

sponsors it is essential that the NSO

a prestigious location and the event

fully understands what form the

was successful. The function con-

sponsorship will take as well as

sisted of a formal dinner, with a

understanding the level and form of

significant attendance fee, and

acknowledgement that the sponsor is

considerable funds were raised by

seeking.

auctioning a range of donated items at the end of the dinner.

The key to success is to develop 38

Handbook on Financial Resources Management and Development

To ensure the success of the occasion

which provide benefits in respect of

particular care and attention was

the purchase of nominated goods and

given to its organisation including

services.

producing high quality invitations and dinner menus, the caliber of the

Another area is where fees are paid

speakers and the location.

to NSOs when their members take out housing and other loans with a

Affinity Programs

particular bank.

This is an area of financial resource development which is relatively new to Scouting. It also has many similarities to, and can be considered as an extension of, sponsorship.

Also the World Organization of the Scout Movement in 1996 entered into an agreement with Visa International and Seoul Bank for the issuance of Visa Cards to Socut members through World Scout Affinity Program.

The Scout Association of Hong Kong has entered into with a local Bank for the issue of a Scout Visa cards to its members.

Other examples include telephone companies issuing specially designed cards for members of NSOs, including ones which are issued to younger members to provide them with the facility to call their parents should the need arise, and discount and membership cards issued by some NSOs 39

Handbook on Financial Resources Management and Development

IV. Fund Raising

use their donations not only to assist Scouting but also to enhance their

Fund raising is a valuable part of

prestige and honour in their commu-

strengthening Scouting as cash and

nity. It is therefore important to

non-cash contributions and resources

acknowledge all donations and praise

are needed to carry out our desired

the donors for their loyalty to the

and planned activities. The obtaining

community and for their much

of resources is therefore a desired

needed and appreciated support. The

and honourable task and fund raisers

two most important words in raising

are to be acknowledged and praised.

funds, and thereby running a suc-

The image of Scouting as well as its

cessful NSO, are “Thank You!�.

contribution to the community, coupled with the significant contribu-

Accountability

tion that fund raising makes in

Donors want to know what has been

achieving them, must be consistently

achieved with their donation and

conveyed to the public.

whether we reached, or partially

Principles of Fund Raising

reached the objectives we outlined when we asked for a donation. A

Integrity

very effective way of keeping them

Integrity is the key to fund raising. It

informed is to send donors a

is most important that those raising

progress report.

the funds as well as those providing the funds are convinced as to the

Transparency

integrity and worth of Scouting. In

Transparency goes together with

addition, everyone associated with

accountability. All accounting records

and responsible for the fund raising

must be open and available and they

must believe in the benefits and

include Published Accounts, Annual

value of the activity, or project that

Reports and similar documents. It

the funds are being raised for. The

must be remembered that these

level of commitment is a most

records should also be open and

important attribute.

available to the public.

Acknowledgement

Persistence

Acknowledgement is not only a

Not everybody is a donor. You must

courtesy – it is a must. Many donors

recognise that not being able to

40

Handbook on Financial Resources Management and Development

obtain a donation from one source

through Leaders, members of Scout

does not imply failure. Do not give

Committees, government officials

up. You may experience eight

and senior members of your local

rejections but the ninth and tenth

community.

request may bring the needed donations.

Know how to get it: A simple, yet professional letter of introduction,

Recording Project Inputs

clearly setting out who you are and

It is important to create and maintain

what you are seeking, including the

accurate records of all funds and

purpose for which the donation will

resources donated to a particular

be used, is important. Make it simple

project. Too often certain donations

and easy to read and always ensure

(especially communal labour and

that it is politely and correctly

gifts in kind) are overlooked and not

addressed. Being able to add a

recorded and therefore the true

personal touch to a letter is always

worth of the project is undervalued.

an advantage. If you take the time to

Techniques of Fund Raising

learn a little about the person you are writing to, it will help your

There is no magic formula for

request by adding a personal touch

successful fund raising. Basically,

to your letter. It is also helpful if you

there are only four simple steps:

are able to request a well known and respectable person to sign the letter.

Know where the money is: Identifying donors for a particular

Go out and get it: A common

fund raising project is an important

reason for not giving is not being

step. This is not always easy as

asked. In addition, do not assume

decisions have to be made as to

that the potential donor fully under-

specific segments of the business

stands the request simply by receiv-

world or the community to be

ing a letter. Ask clearly and directly

approached while, at the same time

for exactly what is being sought and

avoiding undesirable sponsors such

repeat the message. Ask more than

as liquor and tobacco companies and

once, especially if a large donation is

other unethical or otherwise unac-

being sought, and make it as easy as

ceptable parties. Potential donors

possible for the donor to respond and

may be identified, and sought

contribute. The person presenting to 41

Handbook on Financial Resources Management and Development

the prospective donor must be

guidelines and regulations relating to

knowledgeable and well briefed

fund raising in the relevant jurisdic-

before hand. Preparation of a

tion, and as decreed by the NSO, to

proposal setting out how much

ensure that you will be able to

funding is required, how the donation

comply with these requirements.

will be utilized and how many people will benefit will be helpful..

•

Obtain approval from your NSO and

then obtain the necessary approvals Thank you: Saying “thank you” is a

and licenses from the various

simple and polite way of reassuring

authorities to undertake the fund

the donor that the

raising activities.

donation has made, or will make an important contribution to Scouting

• Set the goals of the fund raising

and that the donor is reassured that

campaign, including preparing a

the right decision has been made.

detailed budget. It is important to ensure that the amount raised can be

It is always a nice gesture to publicly

tallied with the donations, effort and

recognize the donor at an appropri-

resources put into the campaign.

ate event such as at a prize giving ceremony, the Annual General

•

Meeting, at the camp site where the

raising campaign including the

donation was used. In addition,

appointment of a Planning Committee

sending a photo of how the donation

and key officers of the campaign

was used will always be a positive

including the Fund Campaign Direc-

way of saying “thank you”. Long-

tor/Manager.

Prepare an overall plan for the fund

term recognition such as a name plaque etc. should be arranged for

•

those who make significant dona-

fund raising activity(ies) including

tions.

consideration to any limitations that

Procedures of Fund Raising

Determine the actual format of the

are likely to arise or should be imposed.

The procedures and steps associated with a fund raising campaign include:

•

Ensure that all relevant insurance

issues are considered, and cover

•

Review the various laws, policies,

42

obtained, to protect both the NSO as

Handbook on Financial Resources Management and Development

well as all people participating in any

Examples of Fund Raising

fund raising activities.

Funds may be raised through the

•

Develop an appropriate publicity

following formats:

and public relations campaign to promote both the fund raising activity

•

as well as the image of Scouting.

and/or sponsorship

•

•

Seek the support of outside parties

in identifying potential donors and

Direct solicitation for donations

Developing various fund raising or

expense reduction partnerships

soliciting sponsorship.

•

• Establish and maintain appropriate

Approaching retired Leaders,

retired members of Committees etc.

accounting and financial records and

and establish a regular “donor

arrange for an audit at the comple-

program” for such people. Obtaining

tion of the fund raising activity.

tax deductions for donations will be a positive incentive

• At the end of the campaign, hold an appreciation ceremony to recognize all

•

those who were involved, especially

uniforms, equipment etc

Operating Scout shops selling scout

donors, sponsors and volunteers.

• Renting camp sites to outside Make an evaluation of the campaign

parties

and prepare a report for future reference (this would include docu-

• Writing, publishing and selling

menting the whole process, its

Scouting publications

financial outcome, the programs and activities undertaken, a list of

•

achievements and lessons learned).

social activities

Holding Banquets, balls and similar

The report should be presented to the NSO and any regulatory body

•

requiring such a report.

plays, movies etc

•

Sponsoring Gala premieres of

Producing variety shows, plays and

musical performances 43

Handbook on Financial Resources Management and Development

•

Conducting raffles, lucky draw

competitions, trivia nights etc

•

Arrange a fund raising soccer

match and charge admission

•

Organise a Charity walk

• Holding a Flag day •

Selling souvenirs and other items of

interest

•

Performing a service (job week, car

washing, shoe-polishing, painting, cleaning up areas etc)

•

Obtaining paid advertising in

Scouting magazines

Conclusion Fund raising is a job to which all should contribute and for which all should be responsible. Do it with enthusiasm, integrity and confidence.

44

Handbook on Financial Resources Management and Development

V. Partnerships

Committee Members as well as

A Partnership exists when two or

increasing the recognition and

more parties (be they individuals,

awareness of Scouting both in the

corporations, organizations etc),

community, with governments and in

having a mutual interest, agree to

the business world.

seek a common outcome or achieve common goals by implementing an

Provided that partners are chosen

agreed plan of action, a program or

carefully, and that the rationale

project while adopting common

behind a particular partnership is

strategies and actions.

soundly based, there will be a reasonable expectation that the

In many countries “partnerships”

partnership will continue and will

have legal status or recognition and

provide mutual benefits over many

therefore it is necessary to ensure

years.

that each partnership is created, and operated in accordance with the laws

Objectives of a Partnership

and regulations that apply in each

Each partnership will have its own

respective jurisdiction.

aims and objectives. However, it is essential that when considering the

To assist your understanding of

formation of any partnership all

partnerships in the Scouting context

prospective partners initially spend

it is important that you also read

time identifying and agreeing a

“The Marrakech Charter – Bangalore

common set of objectives which will

Revised Edition” on ‘Partnerships in

govern that partnership.

Scouting” produced by the World Scout Bureau.

While many objectives will be based on sound business practice, as well

Today, many NSOs are recognizing

as the Intended outcomes that each

the range of benefits and opportuni-

partner desires, there are various

ties which flow from entering into

fundamentals which should always

strategic partnerships, albeit with

apply. These will include a genuine

partners whose stature and ideals

commitment to the partnership; high

match those of Scouting. Benefits can

levels of service and performance;

be of a financial nature; lead to the

the achievement of specified out-

recruitment of additional Leaders and

comes; the protection of the interests 45

Handbook on Financial Resources Management and Development

of each partner and being open and

Creating a Partnership

trusting in partnership dealings.

Principles of a Partnership

The creation and operation of a partnership usually comprises a

Complying with all relevant laws and

number of phases which follow one

regulations relating to partnerships

from the other and may include:

as well as abiding by the following ated with financial cooperation, will

• •

reinforce the agreed partnership

phase;

objectives as well as creating a

• •

generally accepted principles associ-

positive atmosphere between the

A planning phase; An implementation (or launching) A development stage; and The productive stage.

partners: Before entering into a partnership it

• Determining jointly the aim of the

is most important that the Scouting

activity or project(s) to be funded;

partner obtains approval from its

•

NSO to do so. In addition, and

Agreeing on the criteria and rules

governing the injection of funds and

throughout each stage it is essential

the provision of services;

for the Scouting member of the

•

partnership to comply with the

Ensuring transparency in financial

management;

various policies, rules and guidelines

•

established by its NSO.

Exchanging information on adminis-

trative and financial procedures; and

•

Evaluating jointly.

The partners must work closely together so as to ensure not only the

Within every successful partnership

success of the partnership but also

there should be mutual trust as well

the development of a relationship

as benefit and reward for all part-

that will readily accommodate

ners. This may well require change to

changes and refinements to its

previously agreed objectives and

objectives, vision and direction. The

outcomes as well as the possible

design of the partnership structure;

introduction of additional or varied

its processes and the roles and

resources. All partners must there-

responsibilities of its staff should

fore be flexible in their approach to

always be aligned to the objectives

their partnership.

and strategies of the partnership.

46

Handbook on Financial Resources Management and Development

Progress of the partnership should be reviewed at least annually.

• Business entities both public and private

•

Public, semi-public and private

The practical, operating aspects of a

agencies

partnership will include:

•

Industry bodies such as Chambers

of Commerce and Industry

•

Developing budgets and ensuring

that adequate finance is available

•

•

Other charitable, community and

voluntary bodies

Designing and installing appropriate

accounting procedures

and within each of these groups of

•

potential partners there will be many

Maintaining appropriate accounting

records

opportunities and avenues of poten-

•

tial benefit to pursue.

Ensuring that adequate insurance

cover has been obtained

• Agreeing how the profits (and

In recent years some of the partner-

losses, if any) are to be shared

ships that Scouting has entered into

•

have a specific financial focus, such

Agreeing on the provision of

resources as between partners

as receiving funding from Govern-

•

ment to work with indigenous people

Preparing and signing a partnership

agreement

or to provide funds for advertising to

Examples of Partnerships Within Scouting

enhance the image of Scouting; to reduce the cost of communications and to provide support for major

Today, Scouting is entering into

events such as reduced cost of goods

partnership with a diverse range of

for major events.

partners while, at the same time, ensuring that the goals of each

However some partnerships have

partnership remain directed towards

been created specifically to provide

attaining and enhancing the goals of

other benefits both to Scouting and

Scouting.

the community. These have included partnerships with community organi-

The following illustrate the range of

zations to provide a source of new

potential partners for Scouting;

Leaders; working with volunteer

• Governments

groups to provide computer training;

and Government

Departments at all levels of government

providing education on AIDS and 47

Handbook on Financial Resources Management and Development

environmental support such as planting trees.

In these later partnerships the financial reward will often flow from a heightened level of awareness of Scouting in the community.

48

Handbook on Financial Resources Management and Development

VI. Project Management Definition

While it is not a technique that suits itself to everyday tasks it certainly has a place in larger activities such

Everything we do, not only in Scout-

as planning and running a jamboree,

ing, requires managing at one level

building a new camp site or establish-

or another. However in the context

ing a scout shop.

of this section of the Handbook, “management” is the utilization of

A Project is a one-time job that has

(financial) resources to achieve the

defined starting and ending dates, a

aims of the enterprise in a controlled

clearly specified objective or scope of

and structured manner.

work to be performed, a pre-defined budget and usually a temporary

It is an essential organizing and

organization that is dismantled once

managerial discipline that requires

the project is completed.

execution skills in getting things done. It is a set of well-defined

Scouting has long been a leader in

methods and techniques for manag-

the field of Risk Management, which

ing a team of people to continuously

certainly has a role in Project

monitor the progress and finally

Management, and accordingly this is

accomplish a series of work tasks,

an area where experience and skill

within a well-defined schedule and

will be available.

budget. While it directs to everyday tasks it certainly has a place in a

The Triple Components

larger activities such as planning and

There are three important compo-

running a jamboree, building a new

nents of project management which

campsite or establishing a scout

guide each project:

shop.

• Scope – a project must meet the customer requirements – where the

Project Management is the discipline

customer is often the NSO

of organising and managing re-

• Time – a project must be com-

sources in such a way that these

pleted on time

resources deliver all that is required

•

to complete a project within its

its budget

Cost – a project must not exceed

defined scope, time and cost constraints.

49

Handbook on Financial Resources Management and Development

The scope defines what must be done

keep track of the various project

to produce the project’s end result;

tasks.

the time component refers to the

•

amount of time available to complete

requires resources on an unplanned,

a project while cost refers to the

ad-hoc basis.

budgeted amount available for the

•

project. These three aspects often

reduce risk and increase the chances

compete against each other as an

of success.

Project management frequently

Project management is designed to

increase in the scope typically means increased time and increased cost, a

and these are factors which often

tight time line could result in in-

distinguish a project using project

creased costs and reduced scope

management from those engaged in

while a tight budget could mean

more conventional and ongoing

increased time and reduced scope.

activities.

Project management can therefore be described as providing the tools

Project Management Activities

and techniques that enable a project

The constraints and controls embod-

team to so organise their work so

ied within a project management

that they are able to work within

exercise embrace a host of different,

each of these components.

yet never-the-less related activities

Features of Project Management The main features of project man-

and functions. This attention to control and organization is the trademark of project management.

•

Planning the work and agreeing the

agement include:

overall objective

•

•

Project management can be

Reviewing the various components

complex and accordingly is not

of the project as a whole and deter-

appropriate for small tasks.

mining the individual objectives which have to be met to completion

•

Project management has both a

•

Assessing and mitigating the

definite beginning and an end; it is

various risks which are likely to arise

not an open ended process.

during the project

•

• Estimating the total level of re-

Project management uses a range

of management tools to measure

sources and allocating them across

what has been accomplished and to

the project

50

Handbook on Financial Resources Management and Development

•

Arranging the overall work plan,

conclusion of the project at the time

acquiring the necessary human and

of the post-implementation review.

material resources and assigning

The actual controls to be used will be

them to individual tasks

determined on a project by project

•

basis involving every step in the

Directing and controlling project

execution and tracking, measuring

process as too much control is time

and reporting progress

consuming and too little control can

•

be costly. Control systems are often

Analysing the results and defining

the outcomes achieved

used in areas relating to costs, risk,

• Forecasting future trends in the

quality, communications, time

project

requirements, change, procurement

• Ensuring that there is “Quality

and human resources.

Management” (including Risk Management) and“Issues Management”

Initiation

throughout the life of the project

The initiation stage, its conception, is

Elements of Project Management

critical in determining the nature and scope of the overall project. There are significant risks to the project as

Project management is often conve-

a whole if this part of the process is

niently divided into two distinct

not undertaken with due care and

segments; the first comprises its

attention to detail as a lack of

control systems and the second is

planning may result in the project not

comprised of the following four

meeting its desired needs, objectives

stages:

and expectations. The major require-

• initiation; • planning and design; • production or execution; and • closing and maintenance.

ment at this stage is to have a full

Control Systems

and complete understanding of both the business and commercial environment in which the project will be undertaken.

Project control is that segment of a

Planning and Design

project that keeps it on-track, on-

Once the concept has been devel-

time and within budget. It begins with

oped, the planning and design takes

the initial planning to determine what

place. Occasionally a small prototype

systems are required and ends at the

of the final product is built and 51

Handbook on Financial Resources Management and Development

tested. The outcome of the design

Closing and Maintenance

stage should result in a concept and

Closing marks the formal completion

a design that:

of the project and the formal handing over to the customer. The project is

• satisfies the end user (the NSO)

all but completed. Certain adminis-

and meets all business requirements

trative activities, include the

associated with the project

archiving of files, plans, manuals etc

• should function as intended.

• will meet all quality standards.

• can be completed within time and

and the preparation of a formal report on the project, may remain but these will be quickly completed.

budget constraints

•

meets all necessary requirements

and regulations

Production or Execution

Maintenance is ongoing throughout the project and will include:

• Providing continuing support to the customer/end user.

The production or execution stage is

•

when the design or plan is converted

equipment or product etc as required

into a fully operational project. All

and, if appropriate, rectifying the

systems are “go” and the various

fault under warranty.

segments of the project come on

•

stream. If computer software

versions become available ( if

systems are employed, this will be

required within the terms of the

Replacing and/or repairing plant,

Updating software systems as new

the appropriate time that any

project)

necessary conversions, production of

•

documentation and training are

maintenance tasks provided for

carried out. Training is important

within the terms of the project.

because it ensures that the project

Undertaking any servicing or

of the project’s work and the incur-

Challenges of Project Management

ring of all expenditure, capital and

There are many potential challenges

revenue, occurs during this phase.

and pitfalls which may be encoun-

software is used correctly. The bulk

tered when undertaking project management. While the following is by no means an exhaustive list it does provide an indicative outline: 52

Handbook on Financial Resources Management and Development

•

Failure to properly define goals;

planning based on inaccurate information; poor communication; inadequate lines of responsibility; project estimates based on incomplete data; teamwork; people being continually reassigned; ballpark estimates; personality conflicts; poor management to name just a few.

Project Manager The role of the project manager carries great responsibility. It is the project manager’s job to direct, supervise and control the project from beginning to end and to do this the project manager should not be directly involved in the project itself but be able to devote their time to manage the project.

A project manager must have, and use, a range of skills:

• • •

Strong leadership People management The ability to communicate (verbal

and written)

• • •

Be a good negotiator Understand planning A sound knowledge of contract

management

• • •

Problem solving Creative thinking Good IT skills 53

Handbook on Financial Resources Management and Development

VII. Acknowledgement The production of this handbook is a

• Ian Langford-Brown for providing

collective effort of many individuals

his time and expertise in strength-

who saw the need to put together the

ening the write-up and putting

principles and concepts of managing

together the chapters.

and developing financial resources.

This is also a product of years of

• S Prassanna Shrivastava for his

experience of NSOs which, as non-

own contribution, coordinating the

profit organizations, have survived

Sub-committee work and the rest

and thrived for many decades.

of the regional staff for editing, design and production

On behalf of the Asia-Pacific Region, we acknowledge the work and

• Mr Luc Panissod of World Scout

contributions of the following:

Bureau for reviewing the text

• Members of the Asia Pacific

Finally, we thank the participants of

Financial Resources Sub-Committee

the 1st International Workshop on

(2004-2007) for writing and editing

Resources Development and

the manuscript:

Management who inspired the idea that a handbook of this nature,

Paulus Tjakrawan, Chairman

designed for the specific need of

Sutham Phanthusak, Vice-Chairman

NSOs, is indeed possible.

Ian Langford-Brown Kazumasa Maehara Hj Radzwan Hussain Paul WC Ho Zainuddin Jaafar Sang Ho Shim Sung-Yuan Hsu Shantha Madurawe Sanjay Mohan Eko Adrianto John C Y Hui (Adviser)

54

Handbook on Financial Resources Management and Development

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Handbook on Financial Resources Management and Development

56