The Institute - June 2019 - 2

president's column

The Importance
Of Transparency
Timely, meaningful, and reliable financial data

association with many organizational units. Conduct that is transparent
and accountable is critical to building
trust among members, volunteers,
and professional staff. Wise conduct
requires consistent understanding,
particularly of financial determinations,
at all levels to make decisions that
benefit all of IEEE and its members.
IEEE is financially sound. But, as I
stated in 2017 in my president-elect platform, my goal was to overcome the then
persistent operational deficits. To run
IEEE with a balanced budget, healthy
reserves, and the ability to invest wisely in
our future requires
understanding, in
sufficient detail, our
revenue and cost
structures. To do so,
we need transparency with preparation and distribution
of timely operational
financial data at the
level of detail needed
to consistently manage our distributed
organization.
For historical reasons, much of IEEE's
cost of doing business has been bundled
together and allocated to its products
and services indirectly-sometimes
unevenly. We need to modernize this
process so we can create more transparency in our financial structure. Better
financial transparency is essential to
run our businesses efficiently so we can
determine exactly what it costs IEEE to
deliver each product and service.
Transparent financial reporting

should maximize the availability of
fiscal information to decision makers
at all levels of IEEE. I believe that
financial transparency should objectively support the reporting of gross
revenues to the units that generate
them, and costs should be resolved at
a sufficient level of detail to individual
products and services and assigned to
the unit that incurred them to pay for services the unit requested and agreed to.
Our volunteers and professional
staff need the processes and tools that
allow effective, efficient, and timely
collection, reporting, and assignment
of revenue and costs
at an appropriate
level of resolution.
These processes and
tools should enable
the ability to trace
and track revenue
and costs in a
bottom-up manner
from organizational
units that then roll
up to IEEE corporate financial reporting. Our financial system should be
able to record revenues and expenses
at the transactional level, coded
by projects and/or activities, and
assisted by an information retrieval
system that supports queries and
analytics from different units.
During my tenure as an IEEE volunteer, I and others have helped promote financial transparency and have
promoted developing a transparent
financial system that explains where
each dollar is spent, roots out waste,
encourages efficiency, and reduces

Better
financial
transparency
is essential
to run our
business
efficiently.

TI-2

JUN 2019

THE INSTITUTE

costs without affecting the quality of
the products and services provided to
our members.
AD HOC COMMITTEES

As a follow-up to the January IEEE
Board retreat, I commissioned several ad hoc committees, chaired by
dedicated volunteers and supported
by members and professional staff, to
address the underlying issues and challenges IEEE faces on its path to becoming a more transparent organization.
The financial transparency ad hoc
committee's charter is to develop
a plan for detailed financial reporting at a sufficient level of resolution and to initiate its immediate
execution, which includes specific
actions, timelines, and funding. The
committee will provide a blueprint
for operating units to present their
budget early in the year, every year,
with the costs to be charged for each
service provided to another unit. The
goal is for costs to be charged directly
rather than being indirectly allocated.
This will allow operating units to
decide which services they need and
are willing to purchase. It is vital that
Board members, as well as all IEEE sections, regions, societies, councils, and
major boards, have access to complete
financial information in order to fulfill
their fiduciary duty to the organization.
The ad hoc committee on contracting
is charged with addressing issues that
have been raised with our contracting
workflows. Every year IEEE organizes
nearly 2,000 conferences, half of which
are in partnership with other organizations. Issues related to contracting with

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The Institute - June 2019

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