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Choice House

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Submitted By Foxinthefire
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Memo – Choice House

To: Joan Tanner and Finance Committee

I have investigated the matters brought to my attention by the Board of Directors Finance Committee and have come to the following conclusions with the information gathered.

1. Were the ED’s salary and benefits in line for EDs with other nonprofits similar to Choice House?

As Choice House belongs to a consortium of nonprofits, I contacted the consortium to gain some clarification on the questions of salary and benefits for the ED. I was informed that the salary of $70k and benefits of $7k were indeed comparable to salaries and benefits of other EDs in the area. I believe we are paying the ED a very reasonable salary with the understanding that Beth was hired because of her previous track record and the expectation that she would be able to produce similar results for Choice House.

2. Why was the office supplies line $7,500 over budget? Who was using the supplies and for what projects?

It should be noted that Choice House has submitted five grants in the fourth quarter, two of which were recommended by the board. None of the five grants have yet been approved. If any of these grants were to go through it would more than make up for the shortage in budgetary funds. Unfortunately it will be a few more months before Choice House will hear anything about these grants.

Most of the expenses this quarter were due to publicity brochures and small gift items that the ED requested for her trip to the state legislator and for other unspecified publicity activities.

The overage was due to the leasing of two copiers for five years. Each house is required to prepare reports daily on the clients for the program and for the prison system. There are other records required for social services, employment searches, employee time sheets, etc. I suggested to the ED that most of this could be handled by Word documents emailed to the administrative assistant and printed out only once at the central house. The ED informed me that because the program needs high-quality brochures, leasing the copiers saves on outside printing costs. She requested that a reliable, top-of-the-line copier be leased at the central house for the administrative staff and at the southern house for her use. The copier leases were negotiated and signed by the program director of the southern house, a close friend of the ED.

3. Were the travel and entertainment expenses properly documented? Why were these expenses $6,250 over budget? Who was incurring these expenses?

As for the matter of travel and entertainment expenses I have learned a few pieces of information of which the board should be aware. When reviewing all the expenses there was very little information to explain what each receipt corresponded with, certainly not enough information for the IRS. The ED did say she could give me names only for each trip. When I attempted to confront our ED Beth about not having sufficient information, I was told: “I am your boss. You answer to me. My trips to the state capitol help Choice House stay visible. If I take care of other business while I am there, this is personal and no business of yours. That is all you need to know.” I believe this may be due to the fact that she is not going to the capitol only for Choice House, yet is charging all her expenses to our account. I have learned that in addition to Beth’s role at Choice House she is also a consultant for another nonprofit in the state capitol. Choice House is paying for any, and seemingly all expenses incurred by Beth while traveling.

The IMA Resolution of Ethical Conflict section clearly states: “Discuss the issue with your immediate supervisor except when it appears that the supervisor is involved. In that case, present the issue to the next level.” I believe it is in the best interest of Choice House and the committee that I present my findings to you and the board to decide how best to proceed. I am not sending a copy of my report to the ED until the board has had a chance to discuss.

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