The Challenge of being the Treasurer

Social Outcomes and Financial Responsibility

Published: August 26, 2022

Read Time: 32 minutes

Glenn Poole: Well, good afternoon. Thank you for coming back so promptly for this final session this afternoon. My name’s Glenn Poole and I’m an Executive in Residence at the Australian Centre of Philanthropy and Nonprofit Studies at QUT’s Business School.

With a long career in the state treasury and seven years as a state auditor general, I’ve little difficulty in acknowledging the power and influence of money within society. With a reasonably long career, as well, within the not-for-profit sector, and being a board member and treasurer of a number of organisations, able to understand the importance of money within the not-for-profit sector.

Working in the state treasury means that you become involved with debates about many aspects of community activity simply because these activities involve finding ways to find funds and having sufficient funds to do the things that we want to achieve. I want to talk about social responsibility and financial responsibility. There’s not much use having financial responsibility unless you’re actually achieving something good for the community. The focus on the importance of money is not new. History reveals that many significant battles and wars have been spat by disputes over access to money and the manner in which it has been spent.

In 1859, the first governor of Queensland, Sir George Ferguson Bowen, received this piece of advice from Sir Edward Lytton, the British Secretary to the Colonies, “Let your thoughts never be distracted from the paramount object of finance. All states thrive in proportion to the administration of revenue.” So it was in 1859 and I think so it is today.

The same is true for community organisations and almost universal thought in many of the good articles in papers that are available for those who accept the role of treasurer is that the treasurer is the next most important role on any board after of course the position of chair. Like a government, an organisation’s success will depend on its ability to manage its finances. Once confidence is lost in an organisation’s ability to manage its finances, the community, the volunteers, and financial supporters will quickly lose faith in the organisation as a whole, and they will also start to doubt the organisation’s ability to deliver its services.

This afternoon I want to share some thoughts on a couple of questions facing many treasurers. Sometimes the questions arise at the time of their initial appointment, but often they become a focus later in the term of a treasurer. Does a good treasurer need more than good accounting and financial management skills? There’s a lot of literature about financial management skills for treasurers.

The second question is: What value can a treasurer add to an organisation in achieving its mission, apart from a focus on the numbers? Treasurers can’t ignore the numbers, but is that all that there is to being a good treasurer? The fact that those questions arise suggest to me that things are changing. The treasurer’s traditional role and the traditional expectations of those who accept the nomination to this position have evolved over recent years, and I see a range of pressures that will continue to shape the way in which treasurers impact on their organisations.

So I want to approach the topic by doing a few things. Identifying some of the changes that have occurred in the operation environment for community-based organisations over the last 20 or 30 years. Many of the changes, I think, have been gradual, so we need to go back a little way to be able to identify the impacts of those changes, or discuss the impacts of these changes on organisations and particularly, the impact on the treasurer’s role. Have a look at some new areas and activities where the treasurer can add value to the organisation and look at some more challenges. As if the past hasn’t been enough, there are a lot more emerging that will continue to change in shape, the expectations of treasurers.

To assist those who, like me, want to pick up a book and go to the end of it to know how it ends, I will say, yes, I do believe that treasurers are more than simply good financial practitioners. In addition, treasurers need to have, I think, some skills that can be a great benefit to their organisation other than keeping a good set of books. They are in a position, I believe, where they can do much that will assist the organisation to achieve its mission and that’s really what it’s all about. Some of the skills that I think are important for an effective treasurer do not always sit so easily with the attributes of those of us who take on the role of treasurers but more of that later.

So let’s start with a brief look in the way the NFP world has changed. There have been some great changes in the community set to over the last 20 to 30 years, and particularly in their more recent experience. In the 1970s and 80s, governments funded and directly provided a basic range of services for the community. The role of NFPs back then was to identify and fill the gaps in services. Quite often, NFPs identified services that were needed by specific sections of the community that weren’t covered by the basic activities of government. Government provided the funding to some of these organisations usually through what were known as grants in aide. These were grants that provided contribution to the direct cost of service delivery.

During this period when I was in State Treasury at that time, I can recall the head of the Queensland Treasury saying that the allocation of government grants should follow where the community members were putting their efforts and their donations. That is, the government should support efforts identified and supported by the community. It should be a follow-up and not a leader in supporting in identifying and supporting community activities.

Throughout the 1990s some of the service gaps that were identified in community groups became more mainstream and attracted a larger contribution from the government. With its larger funding contribution, government started to increase the level of oversight and monitoring of the funding that it was providing. So we had government starting to become more interested in the quality of the services and the quantity of services being provided by NFPs, and service and quality standards started to be more defined, and reporting obligations started to increase.

Over the last 10 years, governments have increasingly relied on the NFP sector to deliver basic services that were previously undertaken directly by government agencies themselves. This trend was already becoming evident in the 1990s and The Industry Commission report on charitable organisations in Australia in 1995 identified increasing demands from government for added forms of accountability and a blurring of the boundaries between the non-for-profit sector, the government, and the for-profit sector.

In 2010, The Productivity Commission reported that the contribution to the GDP from the NFP sector had increased from 3.3% in 99, 2000 to 4.1% in 06, 07. The Productivity Commission report also highlighted that the proportion of NFP funding received from the government had increased from 30.2% in 99, 2000 to 33.2% seven years later. Government funding to the NFP organisations in 06, 07 was some $25.5 billion. So thus, we now have NFPs who are receiving more of their funding from government and with the government directing the type, extent, and quality of the services that the NFPs are providing.

The government and the stakeholders are requiring much higher level of accountability and reporting. In some cases, the types of services being provided has shifted to the areas where government funding is more readily available, so instead of NFPs identifying gaps, NFPs have tended to move into areas that are being funded by government.

So the approach in the 1980s where government money followed the community has been reversed with the government funding now leading the way in identifying activities and services to be provided by the non-government sector. I realise that there are also many NFPs that do not rely on government for their funding, however, those organisations too will be experiencing an increasing demands for information on their activities and achievements from the members and those who are financially supported by the organisation and also from regulators.

So how’s this change in the NFP sector impacted on organisations and treasurers? As a formal role of a treasurer in most constitutions or board charters is focused on the financial health of the organisation, it is not surprising that there will be significant discussion about the technical skills of people accepting these positions.

It seems to be an almost endless range of materials available to assist new treasurers. Most of the professional organisations appear to have found the not-for-profit sector in the last couple of years, so we’ve got Institute of Company Directors, the CPA Australia, Institute of Charter Accountants and Charter Secretaries Australia, and others that have all got articles, guidebooks, courses for NFP treasurers, and board members, and the NFP sector in general.

There are a number of community organisations such as Our Community and the Councils of Social Services in each of the states. You have websites with good, quality reference material, and some of that reference material is being sponsored by banks, or other financial institutions, or professional advisory firms.

There’s also academic research available from university research centres such as ACPNS, and I’ll come back later to some of that research. A search of the internet identifies a number of blogs and pages developed by people with experience as treasurers and in the community organisations. There is a commercial aspect to this free advice. A web search also identifies a number of sites from government agencies. All of the Australian and state treasuries, the ATO, and the ACNC have websites with information available for treasurers all declaring that, “I’m from the government and I’m here to help.”

So my review of all of this material that is focused almost entirely on the how and what of being a treasurer. I’m not going to bother going through that information because I think there’s endless supplies of it that are out there. This information will be mostly useful, I guess, to new treasurers of smaller organisations who might not have a strong financial background. It’s also of great assistance to those who are new to the not-for-profit sector and may not be familiar with the requirements and regulations covering associations.

A treasurer doesn’t operate in an environment that is detached from the environment of the organisation or of the sector in general. With many NFP organisations becoming far more dependent on government, government policy and funding, rather than working to serve a community need which is not otherwise being addressed, some NFPs have, I believe, effectively become the outsource service providers to government. I’ve heard examples recently of NFP organisations that have had to close or merge with other similar entities due to a sudden change in government direction and withdrawal with changes in government.

Maybe it’s because I come from Queensland, there have been fairly noticing this. I did come across one organisation recently that they turnover about a million dollars, and when I looked at their financials, realised that well over $900,000 of that million dollars came from government grants, so they are very vulnerable to changes where the government is ending.

I know there are other organisations that have deliberate policies to ensure that government money doesn’t exceed a proportion of their total costs, maybe 50%. So there are some real changes in there where you need to look at what is happening and prepare yourself for it. I guess a for-profit equivalent might be the future that some of the motor part suppliers have been supplying to Ford for many years, and they are facing, but at least they’ve got three years to adjust to the decision by Ford. In the not-for-profit sector, sometimes governments don’t provide that sort of lead into changes in government policy.

So there have been significant impact on the sources of funding for many organisations and this has occurred during a period when giving in philanthropy by companies and individuals has also come under pressure. These organisations have had some difficulty then adjusting to the change in funding. But as the size and the importance of the contribution made to the sector by government has increased, the stakeholders, as well as the community, have demanded increased accountability.

Who on the NFP board have people looked at to assist in delivering that additional accountability and detailed reporting? Of course, the treasurer. While a focus on increased accountability may be appear to be just an extension of the traditional role of the treasurer, I believe that the changes in the nature of the relationships between NFPs and government and the community have added new aspects to what is being demanded of the treasurers. As I said earlier, once the community loses confidence in an organisation to manage its finances, they do start to question the organisation. The critical issues for NFPs are confidence and trust. How to establish trust and how to maintain it with the key stakeholders.

The financial reports are important, but they are becoming just a starting point for members and for the community wanting to understand the success of NFP organisations. Although financial accountability remains important, notions of accountability have moved from pure financial accountability, with its focus on whether the money provided has been spent. Now the community members, and governments, and stakeholders are looking to identify the social impact being achieved with the funds made available.

So accountability is now seen more in terms of what the NFP has achieved and whether it’s achieving its mission. The treasurer’s role is no longer restricted to accounting for the collection, and expenditure, and financial reporting of the organisation’s funds. It’s not restricted to preparing budgets and reporting on the progress towards achieving those budget targets. In a world that is looking for greater accountability, the achievement of goals and missions, and the measurement of reporting outcomes is the vital area that treasurers need to give attention to.

This is where the for-profit accounting practitioners have an easier job I think, then those of us operating in the not-for-profit sector. For-profit accountants can point to a bottom line, a profit target, or a strong share price as indicators of success and good stewardship. Although the continued solvency of the NFP is a critical indicator of viability, the for-profit success measures are either not relevant or not sufficient for the not-for-profit treasurers to demonstrate that they are achieving good outcomes for the organisation.

The measurement of social impact, particularly social impact in the complex … It’s a difficult and complex thing to measure. To tracking significant academic interest with the Centres of Social Impact operating now at a number of universities. The results of their research will certainly assist treasurers in the future to guide them as they seek to measure impact to assessments that are being sought by the community.

A measurement of social impact seems to borrow concepts from the for-profit world where there may be some reasonably clear links between activity and return. But again, that’s not totally useful in a not-for-profit setting. In a community of social sector, the links between inputs by an individual organisation and the outputs or services delivered and the community outcomes being sort of much more defused and difficult to measure.

Not-in-profit governments is different in a number of aspects from for-profit government and there are some examples. Non-profit organisations are mission driven rather than being driven by a profit motive. The non-profit organisations often have multiple stakeholders who are all critically important to the organisation. They often, those stakeholders often have conflicting primary interests, so it’s not easy to get a measure of exactly what are those stakeholders looking for by way of interest in the organisation. And many non-profit organisations are small in size and subject to accountability regimes that are more aimed at the larger for-profit organisations.

The non-profit boards and committees are generally volunteers and non-profit boards and management communities, like their organisations, are generally under-resourced, and generally, try to skew their resources to service delivery rather than spending it on the structure within the organisation.

In this environment of accountability for achieving social outcomes, it is clearly insufficient just to have good financial reporting. It’s a good start, but really much more is needed. Fortunately, treasurers are usually well equipped in the form of measurement. Accounting principles certainly provide useful tools for the measurement of financial transactions, and these principles and measurement skills of our treasurers can add real value to the organisation grappling with a need to measure social impacts of its activities. I believe that identifying, implementing ways of measuring social impact will be a significant challenge for the treasurers of the future.

Given the difficulty of measuring social impacts and the imprecise nature of the links between the inputs and the social outcomes, it will be precious to adopt approximations and general measurement techniques. This will no doubt be a bit of a challenge for some financial experts who are used to the rigour of accounting reports and their relevant precision and clearly structured relationships. Once you move into impacts and things of that nature, outcomes and some of the judgments will be required in identifying the measurement of the social impacts to ensure that the cost-effectiveness is not lost in the search for perfect impact measurement.

So for treasurers who are used to the rigours of accounting, they’ll need to change their skills slightly to move into a world that’s perhaps a little less precise, but where approximations are what are required. So as accountants are well versed in the concept of materiality and in making on-balance judgments, treasurers should, I hope, feel relatively more comfortable operating in this new area of accountability. But perhaps, the next step may take us a little bit more into unfamiliar territory.

The level of academic research in non-profit boards and governments has increased over the last decade. In late 2012, the journal Nonprofit Management & Leadership brought together a number of articles on this topic from researchers in Australia, Canada, Switzerland, and the United States.

The journal articles explored questions about intra-board team dynamics and how they relate to board and organisation performance. The aim was to better understand the inner workings of non-profit boards by considering topics such as social capital, and board members and networks, internal leadership dynamics, and board performance.

One of the Australian contributors was from associate professors Gavin Nicholson, and Cameron Newton, and Professor Myles McGregor-Lowndes from ACPNS at the QUT Business School. It provided the pilot results and some initial insights from research which looked at non-profit boards as a team. Gavin, Cameron, and Myles have developed a board self-assessment, diagnostic tool to measure the effectiveness of non-profit board operating as a team.

We heard earlier about boards starting to do board reviews. This diagnostic tool is aimed at assisting boards to reflect on their performance and how they’re operating with the concept being of looking at them as a team rather than as individuals. There is a rich amount of research that indicates that an organisation’s board does have profound effects on both organisational outcomes and personal well-being of the board members and the members of the organisation.

The researchers report on the strong and growing evidence that the effectiveness of an organisation’s government system relies on an effective board operating together as an effective team. In the quest by boards to be able to demonstrate that they are effective, many are turning to self-assessments as one method to identify and address performance gaps.

The ACPNS research has enabled the development of a psychometrically sound instrument to assist board members in assessing the team-based aspects of their performance. Boards are then able to act to address the weaknesses identified from the assessment tool. The key elements of the diagnostic to look at things such as membership. Is the membership of the board clearly defined and stable, and is the board sort of work interdependent?

You may think that’s a fairly simply, and elementary, and obvious thing, but when the researchers were doing the research, they got a number of board members to ask the question, “How many members does your board have?” And surprisingly on quite a number of boards, we got different answers to that question from members of the same board.

There was some difficulty in board members actually identifying who were on the board and who wasn’t. Is the CEO who attends to board meeting a board member? Is the person who takes the minutes a board member? And things of that nature. So the question of membership sounds elementary, but if there is confusion about the membership of the board, how does the board operate as a team?

Role clarity: Is the board’s role and purpose clear and challenging? The work from the ACNC around the government’s principle of role clarity is one of them. This diagnostic looks at that and measures it.

The composition: Is the size of the board appropriate? Is the membership appropriately diverse? They looked at feedback, they looked at expectations, what support mechanisms there are, peer support.

The process: Do the board members all contribute to the effort required of them? Does the board examine it’s government’s procedures and things of that nature?

Relationships: Are the interactions between board members and between board management effective? And are they working well? And is their appropriate personal development?

Other measures that they’ve looked at to supplement those core self-evaluation things are around identity: Do board members really identify with the board? The psychological safety within the board: Admin was able to contribute. Is there open debate? Is there risk taking? The board roles and board control.

The diagnostic tool developed by Gavin and his colleagues provides an empirically based frame that is applicable across the vast majority of non-profit boards. Developed from the ACPNS website … and I have put a little card on your table … We now have over 1500 board members who’ve gone through the diagnostic exercise, and they come from more than 300 not-for-profit boards across Australia. They’ve completed assessments, and the extent of this database provides a rich source of data and enables some assessment of board performance to be made. So if you are looking at your board and how it’s operating, I’d encourage you to at least explore that and think about one way of looking at the board as a team.

Another research article in the Nonprofit Management & Leadership journal in 2012 examined the important role of social resources in enhancing effectiveness of non-for-profit boards. The results of the research undertaken in Canada indicated that increased social capital within the board provides a positive contribution to the capacity of boards that govern effectively.

The study supports the need for renewed attention to social and relational considerations inside the boardroom. Social capacity has been demonstrated to enhance collective performance by improving information flows, information sharing, reducing conflict in high demand decision-making episodes, and in reducing turnover in tensions by reducing feelings of alienation by board members.

The importance of sound relationships for individuals in organisations is also the focus work of Relationships Global, a foundation based in Cambridge in the UK. So what you might ask is all of this to do with the skills of treasurers? Remember the careful management of financial affairs is critical to the success and reputation of a not-for-profit board and the treasurer is a key member of any not-for-profit board.

While all board members are expected to have some skills in managing the finances of an organisation, the treasurer is responsible for presenting financial information in a way that is easily understood by the other board members. The treasurer is also responsible for helping other board members to be aware of trends in the financial viability of the organisation and the environment within which it operates. Good communication and relational skills are thus important for any treasurer in fulfilling these expectations.

If the treasurers face the additional challenge that people involved with the not-for-profit sector are usually driven by a strong desire to achieve certain specific social goals. It is working towards achieving those goals and achieving those outcomes that provides the personal satisfaction for the effort involved in supporting an organisation, but the treasurer also needs to marry up the financial viability with people who are passionate about the goals of the organisation.

Some of the earlier research that was undertaken at ACPNS looked at a fairly large and prominent body, a not-for-profit body, within Queensland and they had a look at the finances. It appeared as though the board that was made up of some very well-recognized and well-talented business people actually left their business acumen at the door when they came into the boardroom. They were so passionate about what the organisation was achieving, that they forgot about all of their financial management skills, and that went out in the window, and this is organisation was into fairly deep financial difficulty.

You would wonder how they got to that position with fairly talented people on the board, but it was the mismatch of the passion versus the use of the technical skills. I think that is a very valuable role for treasurers to ensure that the organisation doesn’t become so mission-driven to forget about financial responsibility, or alternatively, that the treasurer doesn’t become known as ‘Doctor Know’ who is always going on about financial responsibility and losing site of the missional activities and the goals of the organisation.

In that mix, I think it is the treasurer’s relational skills that need to be attuned to enabling the organisation to achieve its social goals but to do so in a financially sustainable manner. In this environment where there’s an increased focus on boards acting as cohesive teams, the relational capacity of treasurers will become a key factor in assessing whether a treasurer is seen to be successfully undertaking the role.

So if those sort of changes and the changes of the ACNC, that the previous speakers were talking about are not enough, what else is happening that is likely to have an impact on the role of the treasurer? Craig Roy, the CSIRO’s Deputy CEO, recently identified six mega-trends that are changing the world. In the end, they added that these six inter-linked issues will change the way people lived. The trends he identified were ‘More from less’, ‘Going, going… gone?’, ‘The silk highway’, ‘Forever young’, ‘Virtually here’, and ‘Great expectations’.

The ‘More from less’ I think most people would be aware. It talks about a future scarcity, but he talked about a future scarcity of water, energy, minerals, and food resources. He identified food scarcity and food security as a major challenge for humanity.

‘Going, going… gone?’ explores the pressures on biodiversity and ecological habitats. He identifies that these assets, like the Great Barrier Reef, do not sit on a balance sheet anywhere, but they have significant value for the community.

‘The silk highway’ refers, of course, to the shift in economic power back to Asia where it existed from AD 1 to AD 1000, it also reflects a changing global and political influence.

‘Forever young’ identifies actually that the world is getting older. In 1950, 8% of the world’s population was over 65. By 2011, 11.2% of the population was over 65, and by 2050, this group is forecast to comprise 22% of the world’s population.

‘Virtually here’ Roy highlighted his belief that everything that existed in the real world will have a virtual counterpart in order that cyber connectivity is introducing new ways of working.

‘Great expectation’ explores the new frontiers of the services economy in the digital and creative environment. It also encompasses the economic transformations that will flow from increasing middle class in the world’s developing economies.

So I think for a moment about the potential impact on your organisation from these trends. I’m sure that we all relate to the ‘More from less’ and we claimed that we’ve been managing this trend for some time. But I suggest that Craig Roy is telling us that we have not seen anything yet, and we will need to continue.

We’ve been mainly operating in an environment where basic resources such as water, energy, and food have been available in developed countries, and even if there have been some price barriers, but the potential scarcity on a global basis will bring some new pressures for our organisations.

The 2012 Directors Social Impact Study for the AICD identified that the focus of NFP is on minimising overheads was impacting on their sustainability and on their governments. The study highlighted the tension behind allocating resources for mission or in building up the capacity of the organisation. If adequate funds are not allocated to building the capacity of an organisation, it will not enjoy a sustainable future. That is an area, I know, where a number of the philanthropic funds are channelling some of the grants towards capacity building within organisations to ensure that they will be sustainable.

With particularly a lot of organisations relying heavily on government funding, with the government funding not adequately supporting the development of the organisations, there are some key issues in there for organisations, and for treasurers of organisations to think about the longer term capacity of their organisations.

The challenge of scarcity is a significant one for NFPs and a challenge of treasurers in shaping the future direction of their organisation. Similarly, trends in the ageing population, the shift in power towards Asia, and the move to a virtual world will also have some impact on most of our organisations.

For treasurers, I suggest that they will be well-placed to monitor these trends through their professional connections and be able to influence the thinking of their boards and their senior managers. But remember that after the chair, the position of treasurer is widely recognised as the next most important role of any board. But it will be in the relational aspects of managing that discussion, those fairly difficult discussions about scarcity, that will be important.

So, I commence this session with two issues for reflection. Does a good treasurer need more than good accounting and financial management skills? Secondly, what value can a treasurer add to the organisation in achieving its mission apart from a focus on the numbers?

While the technical aspects of financial management are the main focus of the material to assist new treasurers … and as I said, there’s a raft of it out there … today as NFP treasurer is much more than simply a financial guru. The community and government funders now expect considerable levels of accountability and reporting about the outcomes and social impacts being achieved by not-for-profit organisations. This accountability reporting is in addition to the traditional financial reports and brings new skills and demands for new skills in treasurers in measurement and in reporting concepts.

Responding to the new directions in accountability may require an extension of the use of those skills that are usually held by treasurers, however, the recent academic interests in the performance of a board as a team has identified opportunities for treasurers to display their abilities using different areas of skills. They are not just the numbers crunchers, they are now involved in the relational activities of how the board operates, and how information is shared within the board in an open and accountable manner.

The application of well-developed relation abilities will be of great benefit for treasurers in managing the multiple demands on these new forms of accountability information. Good relation skills will also make the treasurer more effective in assisting other board members in the financial management of their organisation, and remember the expectations of the ACNC about the board, a responsible entity, being responsible for financial management. Boards can not abdicate that role simply to the treasurer, but the treasurer needs to be able to find ways to encourage the rest of the board members to understand their role to help them to undertake and to be equipped to do that properly.

Treasurers, I believe, have a real opportunity to influence the success of the organisation by understanding and enhancing the quality of the intra-board dynamics. Better teams of board level do have a direct impact on the organisational performance. So the equation may, therefore, be more relationally aware treasurers, equal better boards, equal better organisational performance and therefore, with the result being improved social impact, achieved by our NFP organisations, and that really is what our NFP organisations are about: achieving social impact.

I’m happy to take some questions.

Speaker 2: Can I ask a question?

Glenn Poole: Yeah.

Speaker 2: Treasurer is a bit of an ambiguous word. It can range from non-executive finance director to bookkeeper in smaller organisations, some of them want the treasurer [inaudible 00:39:48]. In the context of the ACNC and also Justice Middleton Centre are the argument for the role for treasurer should be abolished because it a great responsibility. What’s your view on that, please?

Glenn Poole: I don’t think you can abolish a role that is the key person for enabling all of that to happen. Yes, boards … If you take a for-profit board, they don’t have a treasurer, but for-profit boards tend to operate with a fairly high powered executive team where there is a CFO and people who are doing that on a day-to-day basis.

Within most boards, they wouldn’t have the same high-powered CFO and therefore, within the board itself, there does need to be someone who has the right skills, the financial skills, to enable the board to do its role. I guess some of the larger NFPs, there might be an argument that they’re a bit more like the for-profit boards, but when you look across the statistics, most of the NGO organisations, the 600,000 that are out there, aren’t in the big league.

So, therefore, I would see a continuing role for a treasurer working with staff, it can do the day-to-day activities, but who is responsible within the board for guiding the board activity. I do see the ACNC and the direction of it being that all members of the board need to be financially aware. They can’t just abdicate, I don’t think, to a treasurer and say, “It’s your job.”

Speaker 3: Looking at … I’m the treasurer of a disability organisation. We’ve got turnover of about a million a year and assets of about $20 million. With the changes that are coming in, do you see that really where the traditional idea of a treasurer next that they looked at really carefully, because I’m certainly becoming aware my role is more of a change agent in helping an organisation move its way through a massive change to a whole new funding model? Reminds me more of corporate advisory work than simply making sure balance sheet, cash flow, and A/L is what it should be.

Glenn Poole: I think my thesis is these days, treasurers in those sorts of roles are more than just the bookkeeper. And they are in the role of change agent within the board. They are in the role of moving the board to understand that the world has moved on. As I look at not-for-profits, the world has moved on, is moving on, and the expectations of the boards are certainly increasing. Therefore, the board needs to change the way it works, and I see the critical role of treasurer of being the person who can move that on for a couple of reasons.

One is I think, treasurers are probably more attuned to it, more aware of what’s happening, and do have a good base of skills to move on. The challenge, I think, for many treasurers who’ve come out of a strong accounting, technical background to realise that the change is on.

In the for-profit world, as I talk to CFOs, that’s all happened anyway. The role of a CFO in most of the large for-profit organisations has moved away from being the accountant to being the advisor to the board and the central-

Speaker 3: So I’m lucky I’m not an accountant?

Glenn Poole: You don’t have to be an accountant.

Speaker 4: The accountants might like.

Glenn Poole: So long as you then have the technical people who are able to do the technical stuff and provide you with that support. So I think that within the for-profit world, the CFO role has changed, and has changed into a more strategic one. I think in the not-for-profit world, the same thing is coming.

Speaker 5: So as the role has changed into more of an advisory-style relationship as opposed to an accounting-based relationship, So has that changed the level of liability for the treasurer and how he or she undertakes that role?

Glenn Poole: I think the liability for all board members has changed. If you take the more recent cases giving back some time but the Centro case and others, the role of all of the directors is changing significantly. The treasurer’s just one among the equals.

Speaker 6: So should a treasurer in an advisory capacity be required to have sort of more personal insurances, similar to what an accountant does?

Glenn Poole: I think that is part of the board. The board needs to have the right sort of support insurances if they see it as appropriate, depending on the size of the organisation. But I would say that all of the directors really do have a responsibility. Some of the researchers, in fact … I’m indicating some of the work Gavin and the people at ACPNS are doing .. is identified that the best thing that you can have on the board is someone who asks the damn questions.

If you do explore the Centro case, while there was some criticism about people not using their technical expertise, it was really criticism about people not understanding and asking the question. Therefore, there really is a role for the finance people to be able to explain it in layman’s language and for the layman to understand it and to keep asking questions until they understand it.

Speaker 6: Yep. Thank you.

Glenn Poole: So they can’t just say, “I’m not a financial expert. That’s your job.” They’ve also got to understand what’s going on. As I see the cases, they say you’ve got to be informed enough to be able to ask the questions, and in board decision making, the team sort of based stuff is indicating you need people who’ll ask the question for understanding, and sometimes that actually challenges the so-called experts to think again. That’s what you need in making those decisions.

Speaker 6: Great. Thank you.

Glenn Poole: Any further questions? Yeah?

Speaker 7: Is there an opportunity for us to have a copy of the presentation as well, too, electronically?

Speaker 8: It’ll be online.

Speaker 7: It’ll be online?

Glenn Poole: It’ll be online, yeah.

Speaker 7: Thank you for that.

Glenn Poole: Yeah, and certainly if anyone wants some further information about ACPNS, have a look on the website. There is a fair bit of research material that’s available, and the speakers from CK Australia did apologise to me beforehand for not mentioning the Standard Chart of Accounts. I can’t finish this session without talking about the Standard Chart of Accounts.

QUT had a ceremony just recently where we handed out the intellectual property to the Standard Chart of Accounts to the ACNC. As you get to understand the information that the ACNC is going to require in their very serious financial report. It is based on the Standard Chart of Accounts, which has now gone national with the aim that, at least at this stage, federal government departments will not be able to ask charities for financial information that the ACNC has.

So the concept of report what’s used often is starting and the federal government departments will be required to go to the ACNC for financial information rather than to the charities. We’ll see how it works with the states also coming online later on. But I think we will start to see some increasing efficiencies and reduction in red tape through the ACNC’s use of that Standard Chart of Accounts.

So I thank you very much-


The Australian Centre for Philanthropy and Nonprofit Studies, QUT
Executive in Residence

Glenn is a professional Board member and senior executive, with over thirty years’ experience in strategic leadership, governance and management in both the public and not-for-profit sectors. Glenn was the CEO of the Queensland Audit Office and Queensland’s Auditor-General from 2004 to 2011. He was a senior executive in the Queensland Treasury Department for over fifteen years. Glenn is currently providing strategic advice in the not-for-profit sector including through his role as the Chair of the Advisory Board of the Australian Centre for Philanthropy and Nonprofit Studies at the QUT Business School and as an Executive in Residence at the Centre. His experience includes serving on the boards of a number of commercially focussed organisations across several industry sectors

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