Prepared by: W Bro Richard Barker, whilst Provincial Grand Treasurer.
Richard now serves the Province as an Assistant Provincial Grand Master and his successor, W Bro Derek Sara will be pleased to answer any questions, and provide support for Lodge Treasurers.
There is plenty of guidance available on keeping lodge accounts books. Lewis Masonic, (aka Ian Allan Publishing), produced a book by Richard Johnson (which is recommended reading) for Treasurers, Charity Stewards, and Almoners in 2005, and it includes an example of a final set of accounts.
The method of book-keeping is a choice for the treasurer; either a receipts and payments basis or an accruals basis is acceptable. It is Consistency that is paramount! However this needs to be explained, in that Receipts and Payments is purely what goes through the bank – the accruals basis tries to match income and expenditure. This article should not be about accountancy, but rather about the Office of Treasurer, its importance, its duties, and how the members of a Lodge can make it less demanding.
The Book of Constitutions (rule 153) gives guidance on the rules for the appointment of a Treasurer, and his responsibility for handling all moneys of the Lodge – I emphasise the word ALL. This should include all Charity and Almoners’ money, as the accounts will be in the name of the Lodge. Legally, The Charities Act requires separate accounts for Almoners’ money, away from other Lodge money.
It is a requirement that charity money is kept separate from almoner money, both separate again from general funds. Whilst almoner’s cash can be given to charity, charity money must never be distributed by the almoner.
Unless the Lodge so approves in open Lodge, that one member, the treasurer, can use electronic banking facilities, two signatures are required for any account (this is still rule 153, as amended by Quarterly Communication on 13th March 2013); preferably the Treasurer and the Secretary, for Lodge money, the Treasurer and the Almoner for Almoner money. Two signatures are required for all accounts, even if that causes some inconvenience. All accounts must be in the name of the Lodge, not even in joint names of trustees. Having an account in personal name may improve the interest rates attainable in the current climate, but at too high a risk!
The second signatory MUST be a named brother (not the holder of a particular office) chosen from amongst several Brethren all of whom MUST have been so authorised by resolution passed in open Lodge – i.e. not the Lodge Committee.
Additionally, the Board of General Purposes reiterated that Rule 153 requires that the Bank and Branch where all accounts are held should be approved by resolution passed in open Lodge If it is the wish of the Lodge to make use of electronic banking, a resolution MUST be passed in open Lodge authorising the Treasurer, and him alone, to make payments from the Lodge’s accounts by electronic means. In the absence of such a resolution, payments must be made by cheque or cash.
A working spreadsheet can be obtained from the Provincial Grand Treasurer, with an example of cash records for general, almoner, and charity funds. These are carried through to the set of accounts, but are an example only! Each Lodge will need to expand sources of income and expenditure according to requirements.
The book already referred to indicates the likely income of any Lodge being, in reverse order of difficulties, charity donations, dining fees, and subscriptions.
Charity Donations are collected by the Charity Steward and the same Lewis Masonic book covers his duties! He would pass the money and the envelopes to the treasurer for banking, and subsequent distribution. Before each collection, make sure the Brethren know for whom the appeal is made. It is too late after the money is collected, and clarity usually increases the contribution.
Some treasurers ask the stewards, or the assistant secretary, to collect all dining fees; a Lodge should aim for no profit / no loss on the festive board. It is recommended that the subscription includes the dining costs of the Provincial visitors at Installation, as this should be a cost shared by all members rather than by only the members attending the installation meeting.
Subscriptions are due in advance at the start of the Lodge financial year and the by-laws of the Lodge will state how much they are, and any sanction for non-payment. However Grand Lodge Dues and Provincial Grand Lodge Dues are due in arrears, invoiced at the end of the year on the total number of members. This is the significant difference in the two methods of recording mentioned earlier; Lodge Accounts sent into the Provincial Office showing the current subscriptions are collected but, because the accounts are prepared on a receipts and payments basis, the expense charge is the dues for the previous year. The reserves are consequently over-stated by the dues in arrears and outstanding. This would not matter until the last set of accounts, but it does flatter the figures, and treasurers must be aware of the liability!
Termination of membership for non-payment of subscriptions after two years is automatic (Rule 148 B of C). The Province has for some time been recommending that by-laws are amended, as allowed in Rule 181 of the Book of Constitutions, so that exclusion is not after two years but after six months. This six month rule may seem severe, but it is for protection only and need not be used. If the two year rule applies, it takes time to advise the Masonic Authorities, and often three years’ Grand Lodge Dues, Provincial Grand Lodge Dues, and Capitation charges are suffered by the Lodge, without any income from the member could amount to more than £130 each year, £400 in total. No Lodge can afford that amount of loss.
Again the Lewis Masonic book referred to earlier mentions the level of subscriptions, to include all outgoings of the Lodge, including Grand Lodge dues, Provincial Grand Lodge dues, and Capitation costs. By Law 15 of the Province suggested a surplus, to be collected, for indigent members!
Try to persuade the Lodge members to set up a standing order to commence payment at the start of the financial year of the Lodge. Attached to this website is a draft standing order. The subscription cannot include the price of the meals for the year, as Grand Lodge changed their rules; some lodges that were originally permitted so to include dining fees can continue. However for other Lodges there is no reason why the standing order should not be fixed at a higher level to include both subscriptions and dining fees! You would then only be recovering the costs of visitors.
The creation of standing orders, and the support of the members, would significantly ease the life of a treasurer – he should not be seen as a debt collector, although that is often his role in reality; a regrettable by-product of humans nature!
In the 2011/12 year 189 lodges are listed, with some 4500 masons. The Book of Constitutions (still Rule 153!) requires the Lodge accounts to be approved by the members in open Lodge, within three meetings of the year end. The Provincial By-law number 17 requires those accounts to be submitted to Province within three months of the year end – these dates cannot always be matched up, so some leeway can be expected in that three month deadline.
Whilst the Treasurer is elected and should be submitting these accounts within time, the ultimate responsibility lies with the Worshipful Master – it is he that as an ultimate sanction risks the Warrant of the Lodge!
Temple Councillors are able to act as a conduit to pass advice both to and from their individual lodges, and to share personal experiences from which other lodges may learn. This applies not only to ritual and recruitment but to organisation and finance. Please share your own experiences and expertise.
The Provincial Treasurer is always willing to be of assistance, although hopefully as a last resort!