EWI News Story

From: Corporate Board of Directors

In our ongoing efforts to streamline operations, the Corporate Board has investigated aligning the financial/operational year of the Corporation and Chapters with the current term of office for the respective Boards. Our investigation included counseling with EWI Corporate Attorney Dennis Astill, Corporate Accountant Scott Czaja, Parliamentarian Carrie Dickson and has yielded the following:

• Currently EWI's Chapter and Corporate financial/operational year is on a calendar year basis, i.e. January 1 – December 31.
• Currently, EWI's Corporate and Chapter Boards terms are October 1 – September 30.
• The financial/operational year term as it is now, causes problems for the Chapters because one financial year is operated by two boards and good business practices indicate that all should be on the same term.
• There are no provisions in the Bylaws or Articles of Incorporation which require that the corporation report on a calendar year basis, or do its budget on a calendar year basis; the Board has the authority to make this change on its own.
• A review of Article VI Corporate Board of Directors, Section 9. Powers and Duties of the Board, gives the Corporate Board general management and control of the affairs, funds, and property of the Corporation. The Corporate Bylaws have nothing specific with regard to the fiscal or operating year, only the date per capita assessments are due to Corporate.
• The Chapter Bylaws have nothing specific with regard to the fiscal or operating year.
• The Procedure Manual is revised by the Corporate Board and through practice and custom has set forth the details of Chapter year-end filings, deadlines and dates of required reporting periods. Under the Procedure Manual, power is given to Corporate in several places:
• Section 5: Corporate Accounting, "The Corporate President, subject to the control of the Corporate Board of Directors, is responsible for all transactions and the financial condition of the Corporation."
• Section 1: Corporate Operations, Chapter 9: Corporate Office, "Requesting Chapter’s financial reports." This demonstrates that Chapters report directly back to Corporate and answer to Corporate with regard to financial issues.
• Section 2: Chapter Operations, Chapter 2: Chapter Board of Directors, 2.0 President, F Chapter Year. This section goes into great detail for the entire calendar year, including filings required and deadlines.
• Section 2: Chapter Operations, Chapter 2: Chapter Board of Directions, 4.0 Treasurer. This section goes into great detail for the entire calendar year of the duties of the treasurer and the means by which they are to be carried out.

Based on the above information, the Corporate Board of Directors made the decision to change the Chapter and Corporate financial/operational year to match the Board terms. We feel it is in the best interest of EWI to make this change. Therefore, we will be implementing this change with an effective date of January 1, 2011.

Supportive Rationale

• Chapters have dealt with the change in their Board term year to coincide with the Corporate Board term year efficiently and effectively in 2003.
• Chapters have voiced their concerns regarding the current structure as being cumbersome and they feel that alignment of all terms is appropriate.
• Elected Corporate and Chapter Officers and Directors will have sole fiduciary responsibility for the funds during their term of office, not a shared responsibility with the previous and following administrations.
• It will make for efficiency, commonality, and simplicity in the operation of the entire organization.
• It is a common accounting practice that a business (for profit or non for profit) will choose a fiscal year end which coincides with the completion of the busiest time of the business year. With EWI the Annual meeting would be a fitting time to cut off the fiscal year end. Some non for profits will cut off their fiscal year ends to accommodate the election and installation of officers.

Changes anticipated:

• IRS approval to change the term – once changed it must remain for 10 years.
• EWI can make an automatic change to its fiscal year under IRS Rev Proc 85-58. This would require a short period return for the period starting January 1, 2011 and ending September 30, 2011.
• Amend Corporate Bylaw Article IV, Revenue, which states "…….Per capita assessments shall be due on February 15 of each year."
• Delete this sentence.
• Or amend it to accommodate the change in term, i.e. "………Per capita assessments shall be payable within 45 days of the billing date." Bylaws should not have procedural items included in them.
• Amend Chapter Bylaw Article V, Revenue, which states "……..Corporate per capita assessments are due to the Corporation on February 15 each year."
• Delete this sentence.
• Or amend it to accommodate the change in term, i.e. "……Per capita assessments shall be payable within 45 days of the billing date." Bylaws should not have procedural items included in them.
• Budget for 2011 that is voted on at the 2010 Annual Meeting, will be a 9-month budget.
• Budget for 2012 (October 1, 2011 – September 30, 2012) would be prepared in summer of 2011 and voted on as usual at 2011 annual meeting, but would take effect October 1, 2011 instead of January 1, 2012.
• Billing for 2011 dues would be for 9 months (January 1 – September 30, 2011).
• Billing for 2011-2012 dues would be in October or November, 2011 (October 1, 2011 – September 30, 2012).

Over course of the upcoming weeks, we will be providing all Chapters with additional detailed information on the change. This will also be a topic of discussion on the President’s Chat conference call June 29, 2010, and again on our Open Forum call of August 10, 2010. In the interim, if you have questions or concerns about this change, we invite you to email Corporate President Louise Anderson – landerson@mauricehjoseph.com.