Association Executive - January/February 2008 - (Page 13)

your long-term investment goals. Often this task is left to the not-for-profit staff, which can pose many risks and questions including: • Does the staff have the knowledge or training to adequately review a manager’s performance? • How much risk was taken by the manager to obtain that return? • How do the various managers correlate with one another? • What technological resources and analytical tools are available to do the right job? Although each manager will provide its own performance appraisal, there is clearly a need for an independent analysis. The trustees have a fiduciary responsibility not to let the managers write their own report card. Financial Advisors have the necessary training and analytical resources to routinely produce quarterly performance reports for the trustees review. the endowment’s overall fees. More importantly, the long-term performance of the endowment will be improved. The Importance of a Trusted Advisor In sum, good corporate governance requires efficient stewardship of an endowment. Financial advisors can assist trustees to avoid fiscal mismanagement, increase donor confidence and free up time for both the staff and trustees. As a smaller not-for-profit, it is important to consider the benefits that implementing a new model will bring to the financial longevity of the not-for-profit and ultimately its future success in serving its stakeholders. Jim Ryan and Courtney Moore are private wealth advisors with the Private Banking and Investment Group at Merrill Lynch in New York City. They can be reached at 212-236-5143, james_t_ryan@ml.com, or courtney_moore@ml.com. What is all the blue stuff? Fresh Rocky Mountain air. How Does the New Model Work? Financial advisors can be hired either “a la carte” or in a “wrap arrangement.” In the a la carte option, the not-for-profit pays separately for each service rendered. In the wrap arrangement, the not-for-profit enters into a long-term relationship with the advisor’s firm and pays a single fee for all services. In addition to facilitating the four-step process outlined above, the wrap arrangement can also include custodial services, trading costs, and payment to the investment managers. Welcome to Calgary, Heart of the New West! Where your delegates will not only experience our legendary western hospitality, but also enjoy a city that has won awards as a leader in environmental stewardship. Calgary is home to more than 11,000 rooms with over 4,000 in the downtown core. Combined, the Calgary TELUS Convention Centre and the Round-Up Centre offer over 370,000 square feet of meeting and exhibit space. And who can ignore the lure of the majestic Canadian Rockies - only an hour's drive away. Visit our website at www.tourismcalgary.com for more information or call us toll-free at 1-800-661-1678. Our Calgary destination guide is your key to hosting your next event in Calgary, Alberta, CANADA. Is the New Model Affordable? Some smaller not-for-profits think that if they can’t justify in-house staff, they also cannot justify outsourcing this work, however this may not be true. The advisor can often negotiate lower fees with the money managers than the not-for-profit could obtain going it alone. If a wrap arrangement is offered, then additional savings can be found in both custodial fees and trading charges as well. In many cases employing an advisor can lower www.tourismcalgary.com 350336_Tourism.indd 1 JANUARY/FEBRUARY 2008 AS SOC I A TI ON 11/28/07 V E 13 PM E X E C U TI 11:05:30 http://www.tourismcalgary.com http://www.tourismcalgary.com

Table of Contents Feed for the Digital Edition of Association Executive - January/February 2008

Association Executive - January/February 2008 Contents From the CEO Good Governance Practices for 501(c)(3) Organizations A New Model: Helping Smaller Not-For-Profits with Their Endowment Management Inside NYSAE Book Beat Too Much of a Good Thing? Enhanced Form 990 Disclosures and Their Impact 7 Myths about Financial Planners An Executive's Guide to Responding to Third-Party Subpoenas Relationship Selling: Maximize Your Talk, Time & Tech to Keep Your Connection Strong Save the Dates Index of Advertisers

Association Executive - January/February 2008

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