INTERNAL CONTROL ISSUE--CONTINUED
In addition to financial control discussed yesterday, other aspects listed below need to be addressed also:
--- Various Roles in the NWCS
There should be written job descriptions for BOD, present, staffs and volunteers. The work of NWCS will be more easily accomplished and problems will be avoided if all involved understand what is expected of them and the limits of their authority.
A comprehensive description of the president’s job should make clear his or her responsibilities in the day-to-day activities of the school and set forth exactly what information is expected by the board and when it must be communicated. For example, if the board expects monthly or quarterly financial reports and programmatic reports, making those expectations clear from the beginning will avoid ambiguity and will clarify the responsibility for accountability to the board.
Similarly, teachers and staffs should have written job descriptions and be advised of what is expected of them. PTA and its volunteers are no exception. The role of PTA need to be clearly defined and its volunteer members should be given job descriptions that clearly describe what is expected of them. Volunteers are indispensable part of NWCS’s function and their hard works are really appreciated. However, if any of them do not understand his or her responsibilities or do not act professionally, the school could be at risk too.
--- Personnel Policies and Training
Personnel policies for teachers and admin staffs, including benefits, evaluations, ordinary and bonus compensation, conflicts of interest and code of ethics, and grievance procedures (including protections for “whistle blowers”) should be in writing and given to all employees prior to hiring, with changes in policies communicated on a regular basis. (My uderstanding is that NWCS already have employee handbook, I would assume it already covered what is discussed above.) As Appropriate training should be arranged for all involved. New directors, officers, employees and volunteers should be trained by those who are familiar with the school operations. For all involved, familiarity with the school’s internal controls is essential.
--- Conflicts of Interest Policies and Code of Ethics
BOD, Presidents and other key personnel should not have any personal or business interest that may conflict with their responsibilities to NWCS. To avoid such conflicts, it is wise to have a “conflicts of interest policy” that clearly states the procedures to be followed if a board member’s personal or financial interests may be advanced by an action of the board. The conflicts of interest policy should require an individual to fully disclose any interest the individual and/or the individual’s family has in any entity that does business with the NWCS and that any change in the information concerning potential conflicts should be provided to the BOD immediately. The policy may be set forth in NWCS’s by-laws. The policy must require that such individual may not participate in any decision to approve doing business with the individual or any entity in which the individual has an interest, and such decision must be made by a disinterested majority of BOD. NWCS should also have a code of ethics addressing issues such as transparency, disclosure in fundraising solicitations, and integrity in governance. The BOD may need to consult with professional such as attorneys and auditors prior to adoption of such policies.
All board members, employees, volunteers and others should be given copies of both policies and sign a statement acknowledging that they have read them.
In sum, we DO have lots of devoted BODs, employees and parent volunteeers who really care about our school and have been working dilligently and contributing to the success of NWC. I admire them! Like other parents,I just hope that with better internal control system in place, we can avoid unnecessry conflicts and disputes in the future. Let us united and work together to rebuilt trust, understanding among NWCS community, for the NWCS's noble mission!
June 13, 2007 6:14 AM
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12 comments:
This should be the guide line for the by-law.
Whoever wrote this should at least help review and amend the current By-Law.
What a shame that you are not one of the BODs.
I truely hope the Board gets a copy of this. It is so valuable to our school. It is scaring to know that each time a princepal leave similar things happen. If we can do as this parent suggested, we can difinetely avoide all the turmoil.
Hope the new board of directors fulfil their fiduciary responsibilities to the entire NWCS community as well as general public, by taking prompt actions to address many parents' legitimate concerns regarding schools's financial management and new principal hiring; and then take steps to improve NWCS's mamagement and operation "check and balance" mechanism.
Keep in mind that the most important assets of NWCS are its good name and the confidence its student parents, teachers, staffs volunteers and donors in its capacity to manage and spend its funds prudently. Integrity is paramount for all involved.
Well said.
I felt bad for Zhoulin. If we had all thses guide lines before, she would not have gone so far.
I totally agree with you. NWCS must have these policies to avoid future turmoil.
The newly drafted policies must be reviewed by the legal experts so that they will not be conflicting with the laws.
Well written. When I was on Saturday meeting, one of the things stroke me is that ZhouLin said board acknowledged her work and performance level and gave her bonuses for the first 3 semesters (1.5 years?). If so, what is board expected principal to do (the roles and responsibility), and how is the work of principal measured (balanced budget, reduce tution, higher parents satisfaction, enrollment number, test passing rate, teacher/student ratio, etc.) What were the factors that board considered to give out bonuses to Zhou Lin? Parents' notice of a few facts seem to paint a different picture if those facts matter when it comes to principal's performance evaluation. Abscense of check and balances and lack of internal control, on top of inappropriate behavior (to say the least)of admin seem to caused a lot of parents concerns from angry about ZL's behavior to distrust of the board.
I think it is to the great benefit of NWCS to consider these internal control issue seriously. It is also important to clarify roles and responsibilities as well as performance indicators for new principal to be successful.
Finally, for any parent who really care about NWCS, please put your focus to future and think about ways to help it to move forward and support new principal. If you care about this blog and want your opinion counts, argue rationally instead of resorting to negative and emotional terms. Several parents set good examples already. Hope we won't see personal attacks here any more. I am sad to see see what happened to NWCS, upset about ZL's behavior and the damage to school, and frustrated about the board. However there were comments on this blog that I don't think help resolve any of the issues.
NWCS families have high hopes for each and every member of Board of directors. We parents and teachers thank you for willing to serve the NWCS in this difficult and challenging time. Being a board member is an hornor, but it comes with duties and responsibilities. We count on the board of directors do the right thing and do things right, with the best interest of NWSC community in mind. Please do not let us down.
I suggest the board to get a copy of "not-for-profit board member handbook" prepared by accounting firm Grant Thornton, (which is available on the web http://info.ethicspoint.com/files/PDF/webseminars
/national_assembly/Grant_Thornton_NFP_Board_
Handbook.pdf"). It outline the important legal and ethical standards typically expect of the not-for-profit board of directors.
I am sure most parents who care about NWCS will support you whole heartly, and contribute in whatever capacity they can for the NWCS, if you will follow the principles and guidances outlined in that handbook, which are applicable to our school for the most part.
As a student parent, I want to thank you BODs again for all your hard work and thank you teachers, staffs, PTA volunteers for sticking together and continute support of NWCS. No doubt there is better and brighter future for NWCS.
NWCS indeeds does need a new by-law. Jim Miao and Zhou Lin (the 2 most powerful personnels in NWCS previously) have both stepped over the line and by-law a couple of times.
The checks and balances were not quite working before, with the board sort of checking the principal and very little checking the board itself.
New by-law should be written with no exception, no amendments unless approved by general parent vote.
I agree. Jim Miao is at least as responsible for NWCS' current problem as ZL. Yes, he did not ask her to lie nor send out that email, he and the board never gave her any clear guide lines and expectations either.
BOARD MEMBER'S DUTY OF TRUST
Now that the COMPLAINTS regarding the current principal is largely over,(am I right?) some are starting to wonder if the board of directors can learn from past mistakes and some concern that if the board will end up having too much power and abusive it. For everyone to have better understanding of not profit board member's duties discussed on the original post, I am copying a direct quote from Oregon Dept of Justice's "GUIDE TO NO PROFIT BOARD SERVICE" here; and concerned parents and teachers may use it as a good reference to see and judge if our board is acting ethically and legally in the future. Among others,
"---Understanding Your Responsibilities:
In carrying out board responsibilities,, the law generally imposes three duties of trust. They are regularly described as the duties of due care, loyalty to the corporation and obedience to the law.
1.DUTY OF DUE CARE
This responsibility generally requires that a director must discharge the duties with the care an ordinary prudent person in a like position would exercise under similar circumstances. --- Directors need not always be right, but they must act with common sense and informed judgment. To exercise this duty properly, boards must pay particular attention to the following:
-Active participation.
A director must actively participate in the management of the organization including attending periodic meetings of the board, evaluating reports, reading minutes and reviewing the performance of the executive director.
-Reasonable inquiry.
Directors should request and receive sufficient information so that they may carry out their responsibilities as directors. When a problem exists or a report on its face does not make sense, a director has a duty to inquire into the surrounding facts and circumstances. The director also has a duty to investigate warnings or reports of officer or employee theft or mismanagement.
2.DUTY OF LOYALTY.
Directors have a duty to give their undivided loyalty to the charitable corporation. Decisions regarding the organization's funds and activities must promote the organization's public purpose rather than private interest. Any potential conflict transactions should be scrutinized closely by the board with the realization that the public will predictably be skeptical of such arrangements. There are some general principles which will serve to guide boards faced with conflict of interest situations.
-Conflicts in general.
While transactions between the charitable corporation and individual board members, their families and businesses they own or operate should be avoided, they are not absolutely prohibited. Under certain circumstances, a contract or transaction between a nonprofit corporation and its director or an organization in which the director has a material or financial interest is acceptable. However, if the transaction is challenged, the director will have the burden of establishing that the contract or transaction is fair and reasonable, that there was full disclosure of the conflict and that the contract or transaction was approved by members or other directors in good faith... The board should only approve the transaction if it is clearly in the best interest of the charity.
-Written policy.
The board should establish a written policy for dealing with conflicts of interest. The policy should address disclosure of financial interest and withdrawal from discussion and voting by interested directors. Due to the sensitivity of conflicts of interest, the board may want to require that transactions benefiting a director may be approved only by a greater than majority vote. Also, requiring an annual disclosure by all board members of their business involvement with the nonprofit organization is recommended.
Loans. In general, a charitable corporation may not lend money to an officer or director. There is one statutory exception. The law allows loans for executive relocation expenses under certain circumstances...
3.DUTY OF OBEDIENCE.
Directors have a duty to follow the organization's governing documents (Articles of Incorporation and Bylaws), to carry out the organization's mission and to ensure that funds are used for lawful purposes. Also, directors must comply with other state and federal laws that relate to the organization and the way in which it conducts its business. For example, directors should be familiar with:
-Federal law.
Charitable corporations usually apply to the Internal Revenue Service for exemption as a tax-exempt organization. Corporations which fail to do so may have their income taxed at normal rates, and contributors to the corporate charity may not be able to deduct their contributions on their income tax returns.
-State law.
In general, charities must register and file an annual financial report with the Attorney General's office... A nonprofit corporation must also file an annual renewal with the Corporation Division of the Secretary of State's office.
-Mission and procedures.
Directors should be familiar with the organization's governing documents and should follow the provisions of those documents. Directors should be sure proper notice is given for meetings, that regular meetings are held, that directors are properly appointed and that the organization's mission is being accomplished.
--"
I am sure all the directors run for and serve in the Board 是真诚的,认真做事的. it is also critically important that all of them are fully aware of his or her rights and obligations, individually and as a team. So that unnecessary mistakes can be prevented while serving the NWSC.
People should read this.
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