The Canadian Association of Research Administrators – Use of Reserve Funds Policy

  

1.0 Purpose

            The Canadian Association of Research Administrators’ (CARA) accumulates reserve funds from each annual budget surplus. This policy outlines the process for the use of these funds. Reserve funds can be used to support CARA’s goals and strategies and are considered for one-time, unique, or specific activities.

2.0 Policy Statement

2.1       CARA's reserve funds are intended to provide an internal source of funds to address one-time unbudgeted expenses, uninsured losses, sudden increases in expenses or unanticipated revenue loss. Reserves are not to be used to replace a permanent loss of funds or to address an ongoing budget gap.

2.2       When reserve funds are used, CARA will aim to replenish them in a reasonably short period of time. 

2.3       The reserves (“Operating Reserve Fund”) are designated funds set aside by Board vote.

2.4      The minimum target amount of the reserve funds will be calculated by the Finance Committee annually after the approval of the annual budget, reported to the CARA Executive Board and included in regular financial reports. The minimum target amount will be established in an amount sufficient to maintain ongoing operations and programs measured for a 4 month period and shall include all recurring, standard expenses such as salaries, benefits, travel, office, program and professional services. In-kind, depreciation and other non-cash expenses shall not be included in the calculation. The Operating Reserve Fund shall not exceed the amount of two year’s budget.

2.5      The Operating Reserve Fund will be reviewed and adjusted in response to both internal and external changes. 

Approved by the CARA Executive Board: 5 April 2016

In the event of inconsistency between the French and English version, the English language version shall prevail.