Society Treasury

1. Society Treasury Board Meeting January 14, 2013

2. Agenda • Job description • Funding model • Quarterly financial statements Q1, 2012/13 • New governance structure CFA NL • Long-term budget plan • Volunteers • Payment infrastructure

3. I: Job description Objective of society treasurer The society treasurer is responsible for managing the financial affairs of the society. This includes, but is not limited to: bank account administration, investment reserves management, oversight of cash inflows, accurate and complete records retention, and tax return preparation. The overall objective of the society treasurer is to maintain the safety and security of the society’s assets, to disburse funds as authorized, and to appropriately account for these transactions. The society treasurer is also responsible for the company financials, unless clearly delegated otherwise. The society treasurer leads the annual financial statement closure and sign-off that is legally required with the help of external accountants.

4. I: Job description (continued) Society treasurerresponsibilities • Maintainallbooksand records relatingto the financial operations of the society • Issue allpaymentstovendors, members, andotherappropriatepartiesforauthorized society expenditures • Collect funds receivedduringlocal society events and make timelydepositsinto a bank account at anappropriate banking institutionopened in the society’s name • Check forelectronicdepositsfrom CFA Institute once per month • Formalizeanannual budget • Preparequarterly financial statements for review by the society board members (cash flow basednotaccrual) • Preparerequired budgets for event/program planning, funding, etc. • Coordinatefundingwith CFA Institute • Prepareanyrequired tax filings • Maintain tax, regulatoryandlegal compliance as necessary • Overseeand manage investment reserves pursuantto the society’s investment policy, as approvedby the society’s board • Provide a semi-annual review of investmentsto the society’s board

5. II: Society FundingModel • The revised Funding Model for CFA Institute member societies was approved at the Board of Governors meeting in April 2011 Society Operational Support (formerly Level 1 fund) Society Growth Support (formerly Level 2 and Level 3 fund) Base + Number of members Number of Locations served Society Stretch Projects Society Candidate Support Projects CFA Institute Driven Special Projects

6. II: SocietyFundingModel (continued) Society Operational Support (formerly Level 1) Purpose of Funding: • Society Operational Support is available to assist all societies in attaining the Society Member Service Standards (SMSS). Each society has reasonable discretion over how funds are spent to support their local activities • Activities: speakers for educational events, food, beverage and venue costs, volunteer awards and recognition, Local CFA Institute Research Challenge and other society prices, social or networking events, outreach to universities, employers, candidates, regulators and media, administrative and support services/expenses, etc.

7. II: SocietyFundingModel (continued) Society Operational Support (formerly Level 1) • Base funding of $11,225 for each society with at least 50 members • Incremental funding of $xx.xx per member: • The per member increment decreases for each additional member • Potential incremental funding for societies serving multiple locations • Direct linkage between SMSS performance (business plan) and funding model. Full funding will be available to those societies which meet all requisite and aspirational SMSS. Societies will be asked to submit a business plan using an online template prior to the start of the CFA Institute fiscal year, and to provide mid-year and year-end reports. Funding in the subsequent year will be determined by the success of the society in meeting the targets set forth in its business plan. • Measure and manage member value: • Perceived value delivered by the society • Actual level of member satisfaction • Percentage of members engaged

8. II: SocietyFundingModel (continued) Society Growth Support (formerly Level 2 and Level 3) Purpose of Funding: • Society Growth Support is intended to move societies beyond “business as usual” and to assist CFA Institute in carrying out its mission at the local level, regional and/or global level. This may include researching and developing new ideas which eventually become viable programs for societies. The model is designed to be flexible, while also bringing greater rigor to the project development, evaluation and monitoring processes. CFA Institute will be particularly interested in projects that are innovative and impactful

9. II: SocietyFundingModel (continued) Society Growth Support (formerly Level 2 and Level 3) • Enhanced proposal process: society submits a pre-application and, providing it is a good strategic fit, receives funding • No hard deadlines, rolling programme • Budget available for 2013: $800,000 ($842,247 approved for 26 projects globally) • Eliminates per society funding cap, although there is an annual budget cap on the entire funding program • Allows for multi-year projects • Collaborative proposals welcomed • Global Evaluation Panel, made up of staff, society leaders and PCRs and with balanced regional representation (Americas, EMEA and Asia Pacific) • Societies unable to meet the Society Member Service Standards are unlikely to be unconsidered eligible for funding

10. III: Quarterlyfinancial statements Q1, 2012/13

11. III: Quarterlyfinancial statements Q1, 2012/13

12. IV: New governancestructure CFA NL Honorary Council (~20 ambassadors, 2-year position, annual meeting with society board) Advisory Board (~4 members, 2-year position, bi-annual meeting with company board) Society Board (KvK registered, 4/8 members, 2-year position, Common Signing) Company Board (KvK registered, Daily Board (3/4 members), 2-year position, Common Signing) Selection Committee Fund Control Committee Volunteer Committees Staffed Office (ZZP/Employee, 2/3 members, Targets/Hours pre-agreed, No Signing) Regular Members (Voting Rights, Bylaws) Affiliate Members (Bylaws) Accountants (PWC) CFA Institute (Funding, Mission, Members)

13. IV: New governancestructure CFA NL • Honorary Council (New) • 20 senior industry members on CEO/CIO level that act as ambassadors based on their contacts and positions (membership of CFA NL stimulated but not required). Councils are assigned for respective 2-year periods (no limitation) after screening by the Selection Committee and formal Society Board Approval. Any CFA NL member can propose a honorary member based on certain minimum seniority requirements. Honorary members are invited to the annual 4casting dinner as well as one annual meeting with the Society Board • Society Board (Membership and requirements determined by ByLaws) • 6 to 8 Candidates are assigned for 2-year periods with a proposed limitation of 3 periods (6 years in total) as of 2013. Screening of new candidates required by the Selection Committee • Selection Committee (New) • A committee of 3 senior members approved by the Society Board and assigned for respective 4-year terms (no limitation). The committee could consist of an ex-President, ex-Volunteer and senior society member. Committee members are expected to actively identify candidates and evaluate/advise on motivation and skills • Fund Control Committee (determined by ByLaws) • KasControleCommissie (KCC). This committee of 2-3 members checks the annual treasury report and advises the AGM on (dis)approval. It is proposed to add the outstepping Treasurer to the committee for at least one term. Volunteers in the committee are appointed by the Treasury Chair for 2-year rolling periods (no limitation) • Volunteer Committees (New) • Committees established and chaired by Society Board members. Number of volunteers and types of roles are determined by the Chair. Membership terms are indefinite. The Chair is responsible for the volunteers and their actions/statements. The chair can delegate the planning to a committee member but is expected to set up at least 2 meetings a year

14. IV: New governancestructure CFA NL • Advisory Board (New) • 4 senior members that are assigned for respective 2-year periods with a proposed limitation of 3 terms (6 years in total). Approval for advisors is required by the Company Board and is targeted at senior industry or society representatives. Involvement of the selection committee is not required. Given the commercial focus of the company, advisors are expected to help support the financial stability and fund growth of the company. Twice a year a meeting with the Company Board is targeted • Company Board • As of 2012, the Daily Board (dagelijks bestuur) of the Society constitutes the Company Board (President, Treasurer, Membership, potentially Vice-President). The Company Board reports to the Society Board as the only shareholder and its directors are listed in the KvK register. As the company is run as a BV, legal and reporting requirements as well as director responsibilities apply. Potentially, an independent Managing Director can be assigned to the Company Board/Staffed Office. This will require a strict framework of designated roles and responsibilities with regular reporting on status and progress. This will take another 2 years in preparation • Staffed Office • The staffed office is currently envisaged to be run on the basis of ZZP contract agreements to enlighten the administrational burden as well as director responsibilities. Two staffed office resources are proposed with a general role split between: a) administrative/website/translation/eventing support for 20 hours a week (E40 per hr), and b) outreach/PR/advocacy/fundraising support for 20 hours a week (E60 per hr). An annual appraisal (backward looking) as well as target planning (forward looking) cycle is to be completed with a Company Board member before formal sign-off

15. V: Long-termbudget plan

16. VI: Volunteers • Fund raising: • One or more volunteers are looked for that take more initiatives in fundraising. For our future financial stability, as well as our sector outreach, this is of crucial importance. In terms of responsibility these volunteers will fall under the Treasury Chair. An alternative might be to add this to staffed office targets depending on the profile of possible candidates. • Fund Control Committee, current members: • Giorah Bour, CFA • Maurice Geraets, CFA

17. VII: Paymentinfrastructure • Society: • Bank account (EUR and USD) • Savings account, only accessible by Treasurer • BV: • Bank account and savings account • Two additional credit cards: one for staffed office, one for President • Staffed Office: • The hours of staffed office members will as of now be strictly limited to what’s agreed contractually (20 hours per week currently). No overdrafts are allowed (otherwise no reimbursement). Packages of 5 additional hours can be bought AFTER agreement from the treasurer

18. VII: Paymentinfrastructure (continued) Expense account procedure: • Annual budget shouldbepreparedfor the next fiscalyearandwillbe split intosingle chair budgets, most notably events • Annualand Event budgets are approvedby the board in order to get a maximum expense budget • Expensesshouldbecheckedandcontrolledbyeachchair • Expensesare first paidbycommittee members or chair, a proper proof of paymentshouldbepresented. No proof, no money.! • (Digital) Invoicesshouldbe sent to the Treasurerfortimelypayment, archivingand update of the bookkeeping • Quarterlypresentationby the Treasurer of the financial statements Contractswiththirdparties: • Obligationstowardsthirdpartiesshouldbebased as much as possible on fee quotes (“offertes”) • Allobligationsabove €500.– needtobe first included in an “offer” • We prefernottopaycash • Always agreewhetheran “offerte” is including or excluding VAT • Ifexpensesmayneedtobevariable, at leastagree on a limit of expenseswith the third party