How $8,000 became $523.85

Last year’s ASUS jacket sales were supposed to be a record-breaking year. But no one can say with certainty where the profit went

Without an official deposit record of how much money the business manager for ASUS jackets was leaving at the Core for the ASUS vice-president to deposit, there’s no definitive way of determining how much money actually went unaccounted for.
Without an official deposit record of how much money the business manager for ASUS jackets was leaving at the Core for the ASUS vice-president to deposit, there’s no definitive way of determining how much money actually went unaccounted for.
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$523.85—it’s the kind of number an ordinary student might have overlooked if ASUS hadn’t lost $26,403 last year.

When former ASUS Vice-President and Chief Financial Officer Ian Anderson presented his outgoing 2004-05 budget at the Sept. 29 ASUS Assembly meeting, the net profit from last year’s ASUS jacket sales was listed among hundreds of other revenues and expenses.

The profit from jackets was $523.85—a small profit within a budget that included a $29,652 loss from ASUS Formal, which former ASUS President John Andrew Pankiw-Petty attributed to poor attendance.

If the ASUS Formal had broken even, ASUS would have turned a $26,403 loss into a $3,249 profit. The profit would’ve seemed small when compared to profits in 2003-04 and 2002-03—$17,711 and $8,936 respectively—but the final budget wouldn’t have made front-page headlines.

The news also wouldn’t have turned the main focus in this year’s ASUS election campaign to accountability measures.

“It’s like watching reruns without watching what we’ve done this year,” said Brad Hammond, current ASUS president. “It’s like watching your year being flushed down the toilet.” But the society that operates with a budget of $225,572 did lose a significant amount of money last year.

And some of that money is still unaccounted for.

In 2002-03, ASUS jacket sales made $6,436, and in 2003-2004 they made $5,161. Last year, ASUS jacket sales made $523.85.

According to last year’s contract between ASUS and AstroWear, the company that provides the jackets and their embroidered crests, ASUS made about $21 profit for every ArtSci jacket sold.

They also profited from the jackets sold by various other faculty societies and programs—Nursing, ConEd, Medicine, Law and COMPSA—and they would have received up to $20 more profit from these society members who ordered jackets because the number of students in these programs is lower and the jackets are more expensive.

If ASUS made about $21 profit on an individual jacket, they couldn’t have sold more than 25 ArtSci jackets throughout the year, according to last year’s budget.

A brief walk around campus will produce the necessary information to turn last year’s jacket budget on its head: there are clearly more than 25 students with an ’08 embroidered on their faculty jackets.

In fact, there should be about 380 students, according to Ian Gillespie, ArtSci ’06 and last year’s business manager for jacket sales.

Which means ASUS should have made more than $8,000 on this service.

“Somewhere that money got lost,” Gillespie said. “At the end of the year, the numbers didn’t balance out.”

Without an official deposit record of how much jacket money Gillespie was leaving at the Core for Anderson to deposit into the ASUS jackets account, there’s no definitive way of determining how much money actually went unaccounted for.

“I guess there was supposed to be [deposit] slips, but I was never told about them,” said Gillespie, who said he considers Anderson a good friend of his. “I’d give it to [Anderson] and tell how much was there … and he’d take care of it from there.”

Anderson refused to participate in a formal interview for this article, saying he had already discussed the issue “ad nauseum” at ASUS Assembly and for the Journal’s Nov. 25 issue.

“Every single penny received by me in jackets deposits was deposited to the jackets account. When I noticed a discrepancy in the amount collected to date, I brought it up immediately with the general manager and president, at which point we investigated the matter to the fullest,” Anderson said in an e-mailed statement.

“Despite our efforts, we were given neither proper nor complete jackets sales documentation until only recently, leaving us with little more than speculation,” Anderson said.

Gillespie said on a few occasions, he took the money to his house as a safeguard because Anderson wasn’t available at the Core to receive the money for deposit.

“It was because of that I got blamed for [the missing money],” Gillespie said. He added that Pankiw-Petty blamed him for the unaccounted money.

But Pankiw-Petty said he didn’t blame anyone.

“It was my job to ensure that the financial officer of the Society was dealing with the problem,” Pankiw-Petty said. “To the best of my ability, that’s what I did.”

Toward the end of their term as ASUS executive, Pankiw-Petty said, Anderson told him that people were leaving money to be deposited without filling out a deposit slip.

Pankiw-Petty said Anderson would take the unallocated money and allocate it to several different budget lines within the ASUS account.

“Which is why money was missing in the jackets account,” Pankiw-Petty said.

Gillespie said he accounted for every penny from jacket sales, and still doesn’t know where the money went.

“I’ve thought about that for so long,” Gillespie said. “I’ve pondered about it for hours on end.”

Whenever Gillespie took the money to his house, he said he would always take the money the next day to the Core accompanied by Alicia Miller, ArtSci’ 07, who was then the operations manager for jacket sales.

Miller said she and Gillespie surpassed what was expected of them with regard to jacket sales, and from a “jackets perspective,” all of the money was accounted for.

“Even if there weren’t deposit slips, all of the money should have been there,” she said. “It shouldn’t have changed things.”

Miller said the missing money was upsetting.

“After working so hard, for this to happen was a slap in the face,” she said.

If one thing has changed at ASUS this year, it’s the system by which people can drop off money for deposit.

“I only accept deposit forms,” said current ASUS Vice-President Lyndsey Hannigan, who requires anyone giving money to her to fill out a form stating the amount of money to be dropped off.

Hannigan then signs the form and files it for record-keeping purposes. “Every deposit is accounted for,” she said.

But that’s not the only thing Hannigan has done to prevent another $29,000 loss for ASUS this year. She said she provides the Society with monthly budget updates and tries to reallocate even the smallest amount of money to various accounts in order to stay on par with her “conservative predictions” for the 2005-06 budget.

According to Hannigan’s Feb. 2 budget update, most of the revenues and expenses are on line with expectations. For any revenues or expenses that aren’t on line with predictions, Hannigan has provided detailed notes about why the money isn’t there yet.

For example, beside a value of $0 for taxi expenses, Hannigan wrote: “There is still a zero because internal billing has yet to be completed since the fall.”

What happened last year was a wonderful wake-up call for ASUS, said Jo-Anne Lorway, ASUS general manager, but it wasn’t the first time ASUS suffered a significant financial loss.

Lorway, who has worked at ASUS for 10 years, said early in her time at ASUS, the Society lost a similar amount of money. Like Hannigan, Lorway said, the next year’s vice-president buckled down to better track the finances, without negatively affecting ASUS’s overall function.

“We can tweak things to make it better,” Lorway said.

She also said no one could have taken any money after it was dropped off at the ASUS house and given to her.

Lorway said she and the ASUS vice-president are the only two people who have keys to open their safe’s door, and they are the only two people who know the combination of the safe.

Lorway said large amounts of cash don’t stay in the building for that long, adding that on Monday, the current jackets chairs had brought $18,000 into the building but the money had been deposited by noon that day.

“We’re as good as the money we get in,” Lorway said. “The money we have handed to us is safe.”

ASUS President Hammond said he feels that when people look back on this year, they will only remember the negative press about the 2004-05 expenses instead of the improvements Hannigan has made to ASUS’s accountability.

“We’ve gone to great lengths to make sure ASUS as a whole hasn’t suffered,” Hammond said.

Pankiw-Petty said the current council has done a fantastic job improving accountability measures.

“The lessons have been learned, and [Hannigan] has worked exceptionally hard in conjunction with the rest of Council.”

But that hasn’t stopped all three teams campaigning for ASUS executive from bringing financial accountability to this election’s forefront.

Alvin Tedjo, ArtSci ’06 and ASUS presidential candidate, said the problem with financial accountability isn’t a problem with one individual; it’s a problem with the structure of an organization.

“We want to make sure that no matter who gets nominated as ASUS executive, [a significant financial loss without accountability] will never happen again,” Tedjo said.

He said he and vice-presidential candidate Melissa Grosser, ArtSci ’07, want to incorporate ASUS as a not-for-profit organization, which would allow the provincial and federal governments to tax them accordingly and to request financial accountability measures.

He would also implement a board of directors to externally manage the finances and pay an accounting firm to audit ASUS’s books.

AMS Controller Scott Bell said the AMS pays the accounting firm KPMG about $8,500 to audit the $8.7 million corporation.

Tedjo said he’s aware of the significant cost to pay an auditor and plans to lobby for an ASUS student fee increase to help absorb the cost.

Currently, undergraduate arts and science students pay a mandatory fee of $19.61 to the Society.

“Right now, the Society runs as a student council. We’d like to see it run more like a student government that is fiscally minded,” he said.

Max Rubin, ASUS presidential candidate and ArtSci ’08, forwarded the Journal’s request for comment to his running mate, vice-presidential candidate Lisa Jorgensen, ArtSci ’08.

Jorgenson said she and Rubin plan to create an ASUS board of directors, with a student holding a two-year position as the board’s chair. Jorgenson said she and Rubin had not yet discussed whether the chair’s position would earn honoraria.

“It’s unfortunate good news doesn’t make the Journal as opposed to scandal because it’s important that [Hannigan] be recognized for the work she’s done this year,” Jorgenson said.

She said a board of directors would increase accountability as well as allow more students to be involved in ASUS because there would be positions on the board of directors for students at large.

“I think it’s unfortunate … that money was misplaced the year before this one,” Jorgenson said. “But I think candidates have to bring to issue what’s most on students’ minds.”

Lindsay Duncan, ArtSci ’07 and ASUS presidential candidate, also forwarded the Journal’s request for comment to her running mate, vice-presidential candidate Kyle Abrey, also ArtSci ’07.

Abrey said he and Duncan would make budgets available to ASUS assembly members one week prior to voting on them. They’d also make their budgets available to students online, and hold votes for budgets only at the ASUS general meeting.

“That way the budget would be approved by the whole student body and not a just a small group of people,” he said.

Besides hiring strong people to sit on ASUS’ various committees, Abrey said he and Duncan would create a finance committee to meet regularly and discuss the Society’s finances.

“We don’t want a single group of people running away and spending all of this money and no one knowing what’s going on,” Abrey said.

AMS VP (Operations) Jenn Hirano said she was happy to see the current ASUS election campaigns proposing new ideas for accountability.

“Having an impartial third party gives confidence to everyone else,” Hirano said, adding she was aware of the differences between ASUS and the AMS with respect to their budgets and full-time staff.

There are eight full-time employees who work for the AMS and two of those employees—Bell and Janice Kirkpatrick, AMS accounting assistant—only deal with the AMS’s finances. Lorway is the only full-time staff member at ASUS.

Hirano said having a board of directors, in particular, helps any organization. Besides the AMS, ComSoc is the only faculty society that has a board of directors.

“It’s our biggest check and balance system,” Hirano said.

Still, those who work for ASUS say comparing the two societies is not worth the trouble.

Wayne Zhu, ASUS vice-president in 2003-04, said he had investigated the possibility of incorporating ASUS, but a variety of factors prevented the audit from happening.

“I am still against incorporating ASUS … since we simply do not have the resources to exist as an incorporated group,” he said. “The cost of an audit each year alone would nearly cripple our finances.”

Hannigan said that if she asked accounting firms to audit her $225,000 organization, they’d probably laugh at her.

“The [vice-president’s] job is to audit throughout the year,” Hannigan said.

Pankiw-Petty said throwing more bureaucracy at the problem of financial accountability might not be the answer to the problem.

“The purpose of [ASUS] is to stimulate the broader learning environment at Queen’s,” he said. “It’s not a business.”

ASUS-AstroWear Contract 2004-05

Price paid by ASUS per jacket, including applicable taxes:

Arts and Science, $258.75
Nursing Science, $282.90
Concurrent Education, $269.10
Computing, $241.50
Medicine, $269.10

ASUS charged students the following for each jacket:
Arts and Science, $280
Nursing Science, $310
Concurrent Education, $305
Computing, $300
Medicine, $340

ASUS made $21.25 profit on every Arts and Science jacket sold. If about 380 ArtSci jackets were sold, ASUS should have made $8,075 profit in total. Instead, they made $523.85.

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