Dunany Country Club

Dunany, QC

By-Laws

 

Revised - June 20, 2020

 

Purpose of the Dunany Country Club, (DCC)

 

It is the purpose of DCC to provide in perpetuity, golfing and social facilities and activities for residents of the Dunany community at a modest cost with emphasis on:

 

• Family orientation.

• Maximum participation of the members in club events.

• A high level of voluntary contribution in management and operation of the club.

• Promoting and teaching of the skills and traditions of the game, particularly among the junior members.

• Maintaining a membership level that will maximize favorable playing conditions.

• Preserving the vision and values of the club’s founding members.

 

 

 

 

BY-LAW #1 - THE CLUB

 

The Club shall be known as the “Dunany Country Club” and shall have its Head Office in Dunany, Quebec.

 

BY-LAW #2 - FISCAL YEAR

 

The fiscal year of the Club shall end on the thirty-first day of December in each year.

 

BY-LAW #3 - MEMBERSHIP

 

A. Any person may be elected a member of this Club subject to the requirements and provisions of the By-Laws and the Rules and Regulations of the Club.

 

B. There shall be ten (11) classes of membership: (1) Regular (2) Intermediate A

(3) Intermediate B (4) Junior (5) Social (6) Out of Area (7) Sustaining (8) Honourary (9) Introductory A (10) Introductory B, (11) Trial.

 

C. Acceptance of membership shall constitute a contractual agreement to abide by the By-Laws, Rules and Regulations of the Club

D. Membership in the Club shall not be transferable nor transmitted by reason of death or other cause.

 

E. The only classes of membership with the right to vote, nominate, hold office and propose & second candidates for membership shall be Regular, Out of Area, Sustaining and Honourary.

 

F.  The only classes of membership with the right to participate in any distribution of the proceeds of the sale of the assets of the Club shall be:

1.Regular,

2. Out of Area,

3. Sustaining

4. and those Honourary Members who at the time of their election to this classification were Regular Members

that have paid their initiation fees in full. Payments shall be in accordance with By-Law #9.

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G. All members have Clubhouse privileges.

 

H. The date for determining the age of any member for membership purposes shall be January 1st.

 

J. Classes of Membership

 

i. Regular Members shall be those who are at least 25 years of age and who have paid an Initiation Fee, if required, and been admitted to membership in accordance with By-Law #4.

 

ii. Intermediate A Members shall be those children of Regular Members who are at least 21 years of age and not more than 24 years of age and have been admitted to membership in accordance with By-Law #4.

 

iii. Intermediate B Members shall be those children of Regular Members who are at least 16 years of age and not more than 20 years of age and have been admitted to membership in accordance with By-Law #4.

 

iv. Junior Members shall be those children of Regular Members who are under 16 years.  Junior Members may enjoy restricted playing and Club House privileges as decided by the Board of Directors.

 

v. Social Members shall be those who have requested transfer from Regular membership, spouses of regular members, those who have been a part of the Junior program or sons and daughters of Regular members. The only privileges available to Social Members are the right to introduce guests and playing privileges up to a maximum of four (4) times per year and only upon payment of green fees.

 

vi. Out of Area Members shall be those Regular Members who reside more than 250 miles from the Club and have been granted this status on request, by the Board of Directors.  Out of Area Members shall enjoy all the rights and privileges of a Regular Member, except playing privileges are limited to a maximum of four (4) times per year and only upon payment of green fees.

 

vii. Sustaining Members shall be those Regular Members who are unable to play for medical reasons and have been granted this status on request, by the Board of Directors. Sustaining Members shall enjoy all the rights and privileges of a Regular Member, except playing privileges are limited to maximum of four (4) times per year and only upon the approval by the Club and payment of green fees.

 

viii Honourary Members shall be elected to this class of membership upon proposal by the Board of Directors.  Such election shall be by unanimous vote at a General Meeting of the Club.  An Honourary Member shall enjoy all the rights and privileges of a Regular Member except for those right limited under By-Law #3 Clause F.

 

ix Introductory A Members shall be those who have requested this category of membership and been approved by the Board of Directors.  Such persons shall be residents of the Dunany Area as defined by By-Law #4, who have completed an application for Regular membership, which has not yet been accepted by the Board of Directors.  The privileges available to Introductory Members are defined in the Club Rules.

 

x. Introductory B Members shall be those who have requested this category of membership and been approved by the Board of Directors.  Such persons shall have completed an application for Regular membership, which has not yet been accepted by the Board of Directors.  The privileges available to Introductory Members are defined in the Club Rules.

 

xi. Trial Members shall be those who have requested and been accepted to a one-time, one-year category of membership available to non-members that has been approved by the Board of Directors.  The Test Drive Membership will allow playing privileges from Monday to Thursday, (when the tees are open). Playing privileges will also be extended to weekend tournaments indicated on the fixture card, excluding club championships. Playing privileges are for participation only and Test Drive Members are not eligible to compete & win tournaments.

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BY-LAW #4 - ADMISSION TO MEMBERSHIP

 

A. Admission to Membership in the Club in any of the various classes, other than Honourary, shall be by resolution of the Board of Directors, upon written application being made thereto, and upon payment of the applicable fees.

 

B.  For membership purposes, Residents of the Dunany Area are those individuals, their spouses and children who own a residence fronting on Black Lake, Boyd Lake, Clear Lake or Curran Lake or in the area surrounding these lakes, which in the Board’s opinion constitutes the Dunany area.

 

C. Applications for Regular Membership will only be considered, subject to the Rules, when the total number of Regular Members enjoying full playing privileges is less than two hundred and eighty five (285).

 

In admitting Regular members, the Board of Directors will also give consideration to the principles outlined in the Rules.

 

 

BY-LAW #5 - BOARD OF DIRECTORS

 

A. The Board

The finances, property and all activities of the Club shall be managed by a Board of fourteen (14) directors, nine (9) of whom must at all times be Dunany Residents as defined under By-Law #4 Clause B.

 

B. Board Meetings

The Board of Directors shall hold a meeting immediately following the Annual Meeting of Regular Members. The purpose of such meeting shall be to elect officers from amongst the elected directors for the ensuing year. Such officers shall include the President, Vice President, Immediate Past President, Treasurer and Secretary. At such meeting the Board of Directors shall transact any other appropriate business.

 

Meetings of the Board of Directors shall be called when the business of the Club requires or upon written request of any two (2) directors.

 

Notice of Meetings of the Board of Directors shall be given in writing at least seven (7) days prior to the meeting. Notice of a Special Meeting, may be given by the Secretary either personally or in writing at least two (2) days prior to the meeting.

 

A quorum shall be eight (8) Directors of whom at least five (5) must be Dunany Residents.

 

C. Powers

 

i. Subject to By-Law #4C, to elect Members of the Club and designate the number of Members in each class.

 

ii. To expel or suspend any member of the Club.

 

iii. To make, amend or revoke Rules and Regulations for the use of the Club by Members and their guests including Rules of conduct in the Clubhouse and on the Club grounds as well as those required to control and direct the affairs and operations of the Club

 

iv. To fix Initiation Fees and Dues for all classes of membership, to fix Green Fees for playing guests, to levy assessments and special charges in any year, to meet the financial needs of the Club.

 

v. To appoint Officers to fill any vacancy occurring in any office of the Club and to appoint Directors to fill any vacancy occurring on the Board of Directors since the last elected.

 

vi. To remove from any office any Officer, Chair or Committee member at any meeting of the Board of Directors at which a quorum is present.

 

vii. To hire personnel employed by the Club.

 

viii. To defer or forgive a members’ indebtedness to the Club under such circumstances and conditions as the Board of Directors may determine.

 

ix. To borrow money in the name of the Club, to open and operate one or more bank accounts and to appoint signing officers subject to By-Laws #11 & #12.

 

x. To repeal, amend or re-enact any By-Law, but such By-Law or By-Laws so repealed, amended or re-enacted shall only be in effect until the next Annual or Special General Meeting of the Regular Members of the Club, and in default of confirmation by a vote of at least two thirds of the Regular Members present at such meeting shall at and from that time cease to have effect.

 

xi. Generally to do all acts and things necessary or desirable to manage the business and affairs of the Club.

 

D. Limitations

 

The following powers are reserved to the Regular Members:

 

i. To sell the real property of the Club or to hypothecate, mortgage or otherwise encumber same: to sell Club personal property except in the conduct of the normal course of the Club business.

 

ii. To repeal, amend or re-enact any By-Law subject to confirmation by a vote of at least two-thirds of the Regular Members present at an Annual or Special General Meeting of the Regular Members.

 

iii. To modify or change the number of Members as provided under By-Law #4 Clause C.

 

iv. To change the design and layout of the course in such a way as to:

a. Increase or decrease the number of holes of play to more than or less than nine (9) holes.

 

b. Require a capital outlay in excess of fifteen percent (15%) of the total Annual Dues for the relevant year

E. Committees

 

i. The Committees shall include but not be limited to the following:

           

            The Honours Committee

            The Finance Committee

            The Greens Committee

            The House Committee

            The Juniors Committee

            The Match & Handicap Committee

            The Membership Committee

            The Social Committee

            The Golf Course Improvement Committee

            The Ladies Committee

 

The Chairs of all the Committees shall have the right to appoint Members to serve on their respective committees.

 

ii. Except for the Nominating Committee, the President may, with the approval of the Board of Directors, appoint such committees as from time to time be deemed necessary for the efficient management of the Club, which committees shall have such powers as shall be assigned to them, orally or in writing by the President or the Board of Directors.

 

iii.  The Nominating Committee shall consist of the President, Vice President, a former Member of the Board of Directors, each of whom shall be appointed by the Board of Directors, and two (2) Regular Members elected by the Regular Members at the Annual Meeting.

 

The Nominating Committee shall nominate fourteen (14) Regular Members, one of whom is not a member of the retiring Board of Directors, to stand for election as Directors in accordance with By-Law #5A.  The report of the Nominating Committee shall be included in the Notice of the Annual General Meeting.

 

 

BY-LAW #6 - OFFICERS

 

A. The Officers of the Club shall include the President, the Vice-President, the Immediate   Past President, the Treasurer and the Secretary.

 

B. Duties

 

i. The President shall preside at all meeting of the Regular Members and Board of Directors of the Club and shall call Meetings of the Regular Members and Board of Directors whenever such are required by these By-Laws, or which in the President’s opinion, are necessary, and shall exercise general supervision and control of the Club’s business.  The President shall have in addition to a vote as a Director, a casting vote in case of a tie.

 

ii. The Vice President shall perform the duties of the President in the President’s absence or inability to serve.

 

iii. The Immediate Past President will act in an advisory capacity to the President and Board of Directors and in the absence of the President and the Vice-President shall perform their duties.

 

iv. The Treasurer shall be charged with the collection, custody and investment of the Club funds, which shall be deposited to the credit of the Club with a Chartered Bank.  The Treasurer shall supervise the accounts of the Club and report thereon at each regular meeting of the Board of Directors.  The Treasurer shall prepare and present at each Annual Meeting of the Members a comprehensive annual statement of the affairs and financial condition of the Club.

 

v. The Secretary shall keep and file minutes of all meetings of the Board of Directors and of the members and maintain a register of members. He shall exercise general supervision over the records and correspondence of the Club and matters relating to the Club’s corporate status, By-Laws and other legal involvements. The Secretary shall also be responsible for the Historical Records of the Club.

 

 

BY-LAW #7 - MEETINGS OF MEMBERS

 

A. Annual General Meeting

 

i. The Annual General Meeting of the Regular Members shall be held at the Clubhouse or at such other place as may be designated by the Board of Directors.  Such meeting shall be held before July 15th of each calendar year.

 

ii. Fifteen (15) days notice in writing shall be given by the Secretary.

 

iii. Fifteen (15) Regular Members present shall form a quorum.

 

iv. Not later than thirty (30) days prior to the date fixed for the Annual General Meeting the Nominating Committee shall deliver to the Secretary the names of fourteen (14) Regular Members nominated by it for election as Directors to act for the ensuing year.  A list of the names of the members so nominated shall be included in the notice calling such meeting.  Accompanying this notice shall be a list of Officers, which the majority of the Directors, if elected, intend to elect as Officers.

 

v. The business to be transacted at the Annual General Meeting shall include the report of the Nominating Committee, the election of Directors, the election of an Auditor or a Financial Review Committee and election of two members of the Nominating Committee for the ensuing year and such other matters as may be properly brought before the meeting.

 

vi. The election of each Director from amongst the Regular Members shall reflect the requirements of By-Laws #5A.  The election shall be by ballot unless the number of nominations is the same as the number of Directors to be elected.  The first nine (9) directors will be elected based on ballots cast for nominees who are Dunany residents.  The last four (4) directors will be elected on ballots for the remaining nominees.

 

vii. Additional Regular Members may be nominated for election as Directors or as members of the Nominating Committee providing that five (5) Regular Members sign and send to the Secretary at least seven (7) days before the meeting a written nomination of such Regular Member of members together with a consent to serve if elected.

 

B. Special

 

Special General Meeting of the Regular Members of the Club may be called at any time by:

            i.          The President or

            ii.         A majority of the Board of Directors or

            iii.        On written requisition to the President signed by not less than ten (10) percent in number of the Regular Members of the Club.  Such resolution or requisition shall specify the nature of the business at such Special General Meeting.  It shall be the duty of the President on receipt of such resolution or requisition to cause the Special General Meeting to be called by the Secretary of the Club.  If the President should refuse or be unable to call such meeting, the Regular Members shall have the right, at the expiration of ten (10) days to call such meeting, or cause the same to be called by the Secretary of the Club.

 

Fifteen (15) days notice of such meeting shall be given in writing to each Regular Member of the Club.

 

Fifteen (15) Regular Members present shall form a quorum.

 

 

BY-LAW #8 - AUDITOR OR FINANCIAL REVIEW COMMITTEE

 

An Auditor or Financial Review Committee shall be elected annually at the Annual General Meeting of the Club.

 

The Financial Review Committee, if required, shall be comprised of Three(3) Regular Members qualified under Clause E of By-Law #3.

 

The Financial Review Committee shall meet with the President and Treasurer to review the financial statements and determine that they have been properly prepared.

The Financial Review Committee shall be available to the Directors of the Club upon request.

 

The Auditor or the Chair of the Financial Review Committee shall submit a report to the Regular Members at the Annual General Meeting of the Club or at a Special General Meeting, if convened.

 

 

BY-LAW #9 - DUES & ASSESSMENTS

 

Annual dues, assessments and applicable initiation fees as determined by the Board of Directors are payable on May 15th of each year.

 

Non-payment of annual dues, assessments and applicable initiation fees by June 15th of each year shall automatically suspend all privileges of membership until such payment is made in full.

 

Non-payment of annual dues, assessments & applicable initiation fees by July 1st of each year and written notice of such shall be deemed by the Board of Directors to constitute the resignation of the member in default and all privileges of membership shall cease.

 

Any member requesting a change in membership status must submit such a request no later than June 15th of the current year.

 

 

BY-LAW #10 - RESIGNATIONS & TERMINATIONS

 

A. The resignation of any member shall be submitted in writing to the Secretary of the Club and shall be effective when accepted and under such conditions as may be imposed by the Board of Directors.

 

B. A member responsible for unbecoming conduct or action detrimental to the best interests of the Club may be suspended by the Board of Directors for a period not exceeding six months.  This suspension may be ordered at any Regular or Special Meeting of the Board of Directors by a vote of the majority of those present.  In the event that such suspension should exceed thirty (30) days, the suspended member will have available the procedure provided in Subsection C below.

 

C. Any member may be expelled from the Club for violation of the By-Laws or Rules of the Club, or for any conduct or action detrimental to the best interest of the Club.  Such expelled member may not use the Club’s property or facilities.  This action may be taken at any Regular or Special Meeting of the Board of Directors by a vote of three-fourths (75%) of the Board of Directors, provided ten (10) days notice is given by the Secretary in writing to the member, stating the time and place of the meeting, the offense or misconduct with which the member is charged, and advising that the member may answer, appear and defend the charges if so desired.

 

 

BY-LAW #11 - AFFIDAVITS

 

The President, Vice-President, Treasurer, Secretary, or any one of them, is or are authorized and empowered to appear and make answer for the Club to all Writs, Orders and Interrogatories upon Articulated Facts issued out of any court, to declare for and on behalf of the Club in answer to writs of attachment by way of garnishment in which the Club is Garnishee: to make all contracts, affidavits and sworn declaration in connection therewith, or in connection with any and all proceedings to which the Club is a party:  to make demands of Abandonment or Petitions for winding up Orders upon any of the debtors of the Club:  to attend and vote at all Meetings of Creditors and grant proxies in condition therewith.

 

 

BY-LAW #12 - SIGNING OF DOCUMENTS & NEGOTIABLE PAPER

 

All deeds, documents, contracts and other instruments requiring execution by the Club shall be signed by the President or the Vice President and the Treasurer or the Secretary, or by such other qualified persons as may be determined by resolution of the Board of Directors.

 

All promissory notes, drafts, cheques and bills of exchange of whatever nature and kind shall be made, drawn or endorsed by the President or Vice President and the Treasurer or the Secretary.  The Treasurer may alone endorse notes or drafts for collection only on account of the Club, endorse notes, endorse cheques for deposit only with the Club’s bankers, to the credit of the Club.

 

 

BY-LAW #13 - DISTRIBUTION OF ASSETS OF THE CLUB

 

All Regular and those Honourary Members who at the time of their election to this classification were Regular Members shall have the right to share equally in the proceeds of distribution of the Club assets.  Such distribution must be approved at an Annual or Special General Meeting of the Members by 75% of the Regular Members and in addition, must have the approval of 75% of the Regular members who are Residents of Dunany as defined under By-Law #4.

 

                                                                       

BY-LAW #14 - INDEMNIFICATION OF DIRECTORS

 

Every Director or member of a committee appointed by the Board of Directors and their heirs, executors, administrators and effects, shall be indemnified and saved harmless out of the funds of the Club from and against all costs, charges and expenses whatsoever which such Director or member sustains or incurs in or about any action, suit or proceeding which is brought, commenced or prosecuted against them for or in respect of any deed, matter or thing whatsoever, heretofore or hereafter made, done or permitted by them, in or about the execution of the duties of their office, if he or she acted in good faith and in a manner he or she reasonably believed to be in the best interests of the Club, and with respect to any criminal action or proceeding if he or she had no reasonable cause to believe his or her conduct was unlawful.

 

BY-LAW #15 - LADIES’ COMMITTEE

 

The Lady Members of the Club are empowered to organize and to conduct such playing and social activities as may be approved by the Board of Directors and shall elect from amongst their Regular Members such Officers as they require for this purpose.

 

BY-LAW #16 - RULES & REGULATIONS

 

The Board of Directors shall from time to time make or adopt such Rules and Regulations as it deems desirable for the governing of the Club.  Such Rules shall at all times complement the By-Laws of the Club.

 

Until rescinded, modified, supplemented, changed or replaced by the Board of Directors the Rules and Regulations attached hereto shall remain in place.

 

RULE 1 - NEW MEMBERS

 

New members should be welcomed to the Club by playing their first round of golf with their sponsor, seconder or failing them, a Director, to familiarize the new member with the Club and its facilities.

 

RULE 2 - PRIORITIES IN ACCEPTING APPLICATIONS FOR MEMBERSHIP

 

The Board of Directors may consider the following priorities in accepting applications for membership:

 

1. Intermediate Members as outlined in Rule 2A

2. Spouses of Regular Members

3. Dunany Residents as defined in By-Law #4

4. Non-Residents of the Dunany Area and their spouses subject to the limit imposed in Rule 3.

 

 

RULE 2A - EXCEEDING MEMBERSHIP LIMITS

 

The only circumstances in which the Board of Directors may consider exceeding the membership limit of 285 set in By-Law #4 is to elect:

1. Intermediate Members who reach the age required for Regular membership and have maintained Intermediate A and Intermediate B membership on a continuous basis.

2. Spouses of Regular Members.

 

RULE 3 - NON-RESIDENTS

 

Regular membership will only be granted to Non Residents of the Dunany Area when the total number of Non Residents is less than thirty-five percent (35%) of the total Regular membership.

 

RULE 4 - INTRODUCTORY MEMBERS

 

The Rules for Introductory Members shall be as follows:

 

Introductory Members have full Clubhouse privileges.

 

Introductory Members have restricted playing privileges, which shall apply from the third (3rd) weekend in June until the Labour Day weekend. During this period, Introductory Members may not play golf on Saturday, Sunday or Statutory holidays before 2:00 PM, except to compete & win trophies in those tournaments indicated on the Fixture card. At all other times, Introductory Members have unrestricted playing privileges.

 

Introductory Members may not play as a guest of another member.

 

Children of Introductory Members have the same privileges as children of Regular Members.

 

The number of Introductory A Members is limited to approximately five percent (5%) of the total Regular Members and shall at no time exceed a total of twelve (12) persons.

 

The number of Introductory B Members is limited to approximately fifteen percent (15%) of the total Regular Members and shall at no time exceed a total of thirty-eight (38) persons.

 

Introductory members must accept Regular membership when it becomes available to them.

 

 

RULE 5 - GUESTS

 

Guests must be introduced by members other than Juniors. Each guest will be limited to six (6) days of golf per year.  The Guest Fee shall be the current Green Fee as set by the Board of Directors.

 

All guests must be registered in the Guest Register. The member introducing the guest shall be responsible for compliance with the By-Laws and Rules by the guest as well as costs or charges incurred.

 

RULE 6 - ORDER OF BUSINESS AT ANNUAL GENERAL MEETING

 

The order of business at the Annual General Meeting of Regular Members shall as far as possible be:

 

1. Calling of the Roll

2. Proof of Notice of Meeting

3. Approval of Agenda

4. Approval of Minutes of the last Annual General Meeting or Special Meeting

5. Business arising from the Minutes

6. Presentation of Financial Statements and approval of the Auditors Report

7. Presidents Report

8. Reports of Officers and Committee Chairs

9. Election of Directors

10. Election of two (2) Regular Members to serve on the Nominating Committee for the ensuing year

11. Election of an Auditor or Financial Review Committee

12. Other Business

13. Adjournment

 

RULE 7 - COMMITTEES & THEIR POWERS

 

On a broad basis the Committees listed in By-Law #5E shall perform the following duties:

 

A.  The Nominating Committee as defined under By-Law #5 Clause E(iii)

 

B.  The Honours Committee shall be responsible for developing, maintaining and administering methods to assess the contribution of members to the Club and recommending to the Board of Directors a suitable means of recognition where exceptional contribution is evident.  The Committee shall be responsible for reviewing new trophies, signs and plaques.

 

C.  The Finance Committee of which the Treasurer shall act as Chair shall be responsible for all matters as defined under By-Law #6 B(iv).  In addition, this Committee shall plan, develop and recommend to the Board of Directors those policies and practices necessary to maintain the Club in a sound financial position.

 

D.  The Greens Committee shall be responsible for the maintenance and improvement of the golf course and such other related matters and shall have power at all times to decide whether the course or any part of it is in fit condition for use, and to permit or prohibit play thereon.

 

E.  The House Committee shall be responsible for all matters pertaining to the Clubhouse and adjuncts thereto.

 

F.  The Juniors Committee shall be responsible for all Junior activities within the operations of the club.

 

G.  The Match & Handicap Committee of which the Director shall act as Chair and Club Captain shall be responsible for all matters relating to Handicaps. Matches, Rules of Play and Competitions.

 

H.  The Membership Committee shall recommend to the Board of Directors candidates for admission to membership as provided in By Law #3 and shall be involved in all matters relating to membership status.

 

I.  The Social Committee shall be responsible for all Social functions of the Club except those of the Ladies Committee.

 

J.  The Golf Course Improvements Committee of which the Director in charge of Greens shall be the Chair shall include the Club Captain and the Ladies Captain.  The committee shall be responsible for reviewing major changes to the golf course or changes that affect play on the course and making recommendations to the Board of Directors.

 

 

RULE 8 - PAYMENT OF INITIATION FEES

 

Upon request and subject to approval by the Board of Directors, the Regular Member’s initiation fee must be paid in full upon acceptance to the club.  Longer term financing terms can be arranged if required.  Payments shall be in accordance with By-Law #9.

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LONG TERM FINANCIAL GUIDELINES

 

In order to ensure that Dunany Country Club generates the cash necessary to replace assets upon the expiration of their useful life, purchase new assets when necessary and maintain a strong financial position, the following policies are recommended:

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Minimum Cash Reserves

Cash reserves are defined as cash and term deposits available on short term notice to finance the operation of Dunany Country Club.

Cash Reserves should be maintained at a minimum of 20% of budgeted revenue.

 

Balanced Operating Results

The budgeted revenues of Dunany Country Club should exceed the budgeted expenses and annual fees should increase accordingly if a deficit is projected.

If the budgeted cash position exceeds 35% of budgeted revenues, deficit budgeting can be planned as long as the minimum cash reserves are maintained.

 

Depreciation

The depreciation rates for all assets should be established and revised based on the useful life anticipated and experienced for the assets in question.  Although replacement of the assets should be planned upon the expiration of the anticipated useful life, replacement should only be budgeted and effected if the asset in question no longer operates in a satisfactory manner.  Such a policy will increase the budget risk but can be managed as follows:

• Create a permanent capital expenditure budget reserve of $5000 for unplanned asset replacement.  No depreciation should be calculated on this expenditure.

• Each year review all assets with a theoretical useful life of zero.  If deemed in satisfactory operating condition, extend the useful life estimate by one year.

 

Capital Expenditures

If the budgeted capital expenditures for a financial year exceed 15% of revenue and will cause the budgeted cash reserves to drop below the minimum, an assessment should be made against the Regular members to increase the budgeted cash reserves to the minimum level.