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AUS Council discusses errors in financing, $20,000 in additional audit costs

The Arts Undergraduate Society (AUS) held its first Council meeting of the semester Wednesday, addressing errors in its financial record, its Memorandum of Agreement (MoA) with McGill, and the election of a new Arts Representative to the Students’ Society of McGill University (SSMU).

Mirza Ali Shakir, vice-president (VP) finance, presented a review of the previous year’s finances. According to Shakir’s executive report, the AUS had underestimated its 2014 Frosh deficit by over $20,000. Another mistake resulting from misclassification was a double entry in their Quickbooks accounting software of $106,000. Shakir attributed these errors to the absence of a VP finance throughout the 2014-2015 academic year.

“We started [last] year with no VP finance, and we ended the year with no VP finance,” Shakir said “This meant that there were poor accounting practices in place, which led to our accounts being messed up.”

The mistakes in AUS’ financial record also led to an increase in projected audit costs.

“The audit, which cost $11,000 last year, is projected to be around $20,000 to $30,000 [this year],” Shakir said. “So an effect of poor accounting practices [is] costing $20,000 more.”

In an e-mail to the Tribune, Shakir clarified the reasons behind last year’s miscalculations.

“[The errors were] mostly caused by high turnover in the VP Finance portfolio, inadequate training for our bookkeeping staff, and minor accounting entry errors.” he wrote.

AUS President Jacob Greenspon is optimistic about the Society’s financial status for this year. “Our current VP Finance is very [capable],” he said.” I’m positive we have moved forward from this actually very well, and hopefully we’re not going to get into that sort of issue again.”

Despite these challenges, Christine Koppenaal, VP social, praised the success of this year’s Arts Frosh. She underscored that additional services for students were provided through the Frosh bursary and the Sober Buddy program.

“We are very, very close to breaking even [on the 2015 Frosh budget],” Koppenaal said. “In the future we’re going to recommend[that] there is a larger buffer going into Frosh to prevent [it] from running a deficit at all, but in an ideal world, since this is student service, we would be as close to breaking even as possible.”

According to Shakir’s executive report, the AUS had underestimated its 2014 Frosh deficit by over $20,000. Another mistake resulting from misclassification was a double entry in their Quickbooks accounting software of $106,000.

Council also addressed its ongoing MoA negotiations with McGill. The MoA outlines the legal responsibilities of AUS and its subsidiaries, including SNAX, a student-run food-retail outlet. In November, 2014 McGill’s decided to prevent SNAX from selling sandwiches due to concerns that it was competing with other food retail outlets on campus drew controversy.

“Sandwiches were a major issue [last year], and they’re pretty much the biggest sticking point with SNAX in these [MoA] negotiations,” Greenspon said. “The negotiations are ongoing, we’re looking to have them wrapped up by the end of this year.”

Negotiations between the AUS and McGill on aspects of the MoA, such as competition and good faith, are still ongoing. According to Greenspon, a focal point of negotiations is SNAX’s willingness to run at cost, thus enabling it to charge lower prices for food than other vendors on campus.

“SNAX does run at cost and does employ students,” he said.”They are concerned about that and want to have some sort of barrier control of the pricing that SNAX charges for its products.”

The possibility of sandwiches returning to the menu remains uncertain, according to Greenspon, though SNAX has undergone changes with an improved point-of-sale system for transparency.

“Recently we did get an offer from McGill to allow SNAX to sell sandwiches, however there are some more concessions from the AUS,” he said. “We’re still waiting to meet with [McGill] again to come up with a formal response to this offer.”

AUS is also seeking a replacement for the position of Arts Representative to SSMU. Samiha Sharif resigned for personal reasons, effective as of Sept. 3. Kat Svikhnushin, VP Internal of the McGill Religious Studies Undergraduate Society (RSUS), was elected in a unanimous vote to serve as interim Arts Representative. Council announced nomination procedures for the by-election via an email announcement on Sept. 10, and stated that online polling will take place from Sept. 30 to Oct. 2.

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