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Change is in the Air: Financial Transparency

Posted By Laura Sawyer, ICA Executive Director, Friday, November 2, 2018

Whether this time of year means moving from cold weather to warm, as in the southern hemisphere, or the start of a new school year, or the leaves falling from the trees--for many of us, change is in the air. And as many of you may have noticed, the past three years at ICA have brought with them numerous changes: a new Executive Director, for one, followed by a new CRM system, new website, new phone system, new publisher for our academic journals, a couple of new staff and, most recently, a new conference submission portal.

One big change, however, might not be so apparent to the casual observer. In the past three years, we have transitioned from an unusual system in which the Executive Director and Treasurer were the same person, reporting to a “Finance Committee,” to a more typical nonprofit structure in which the Treasurer is a distinct role filled by a volunteer (an unpaid member of the organization), working in concert with the Executive Director to manage the finances of the organization, and reporting to the Board of Directors. Peter Monge (U of Southern California) has filled this role for the past two-plus years as “Acting” Treasurer of the organization, as we worked out the kinks and phased out the “finance chair” role. (Instead of serving as finance chair, a past president’s last year on the Executive Committee is now spent as “General Secretary” and Chair of the Regional Conference Committee.) Our current model is the standard for most nonprofit associations and the model I am used to working with personally, so the transition has gone very smoothly, and I am pleased to announce that Peter was approved as the official ICA Treasurer for a three-year term in the 2018 annual election.

As Peter and I have been working together over the past three years or so, we have discussed the importance of transparency and want to convey to you three changes that are designed to improve our fiscal transparency.

We believe that a transparent association is a healthy organization and that members have a right to know how the association’s resources are used to advance the mission. If you’re not familiar with the way U.S. tax law works, I promise not to bore you with too much detail, but in a nutshell: there are a number of classifications for nonprofits that govern how their income is categorized, what kind of taxes they pay, and how they may behave in the public sphere. ICA is a 501(c)3 nonprofit association, and as such, is exempt from most federal taxes. The income ICA derives from its activities—membership fees, conference registrations, subscriptions to our academic journals—does not inure to the benefit of any one person or group, as it would in a privately held for-profit organization. Simply put, when income exceeds expenses and we have a surplus—like we do when a conference has record attendance, for example—we take the surplus and invest it back into the organization.

In the past, we have used surpluses to buy our headquarters building, pay off the mortgage, or invest in an experimental new conference format like San Diego’s Makers’ Hall. Other times a surplus, when we know we can sustain it, goes towards increasing our annual budget for an important item, like moving our headquarters from Texas to Washington, DC years ago, increasing stipends for the editors of our journals, adding money to support a regional conference in a geographic area that really needs more collaboration, ensuring subsidized ICA childcare at our conference to increase access for scholars with children, or finally taking the plunge and upgrading our submission system to ScholarOne Abstracts. Many, many nonprofits don’t have a surplus—some merely break even and others fairly consistently fall short—so while we are fortunate to have the resources to accomplish great things, at the same time, we have to financially prepare for years when things may be a little tighter as well. For example, as pressure is put on the publishing industry to move to Open Access, that transition could negatively impact our journal revenue. To that end, we use surpluses and the revenue from Life Memberships to also put money aside in reserves.

Our goal is to always be transparent about the decisions the ICA leadership have made and the ways in which your membership dollars are put to work to strengthen the communication field and provide more opportunities for collaboration. Everything we do is meant to be the best possible balance of money and mission—doing what is best for the members while at the same time making sure that the organization is financially healthy so that it can continue to exist…so it can keep serving the members and strengthening the communication field.

To further increase our transparency, there are three resources you should know to check if you have questions about ICA’s finances specifically:  

  • All members can now view the approved annual budget for the current Fiscal Year (FY2019), which goes from 1 October 2018 to 30 September 2019, on the reports page of the ICA website. You must be logged in as a member to view the PDF.

  • If you are the Trustee of an endowment or the chair of a division or interest group that “owns” an endowment or fund (e.g., your division is the one that gives out the award funded by that account), you will now begin to receive an annual report on the balance in your account, any transactions that took place in the past year, and the market performance on the account. As our fiscal year ended 30 September, these reports should be available soon. You will receive an email from me with your report when it is ready.

  • As a 501(c)3 nonprofit organization ICA’s tax returns are a matter of public record. I have plans to add our past 990s to the ICA website, but in the meantime, you can view any of the tax returns (for ICA or any other nonprofit organization in the US) for past years at Guidestar.org. ICA is listed as “International Communication Assn.” Click the button marked “SHOW FORMS 990” and choose the year you would like to view.

In addition to those three resources, if you have questions, please feel free to contact both Peter and Laura. We are always happy to hear from the members of the ICA community, and we’ll do our best to get you an answer.

Tags:  November 2018 

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