WR - On-line Ansteorra : Comments and rebuttal... Apology...

[Timothy A. McDaniel]

Preface: I have no idea whatsoever how much money the kingdom has and
what obligations and usual expenses it has.  I'm just discussing
theory.

Good Sir Kief wrote the following ('cause Evil Sir Kief is out working
on a motorcycle and Chaotic Neutral Sir Kief is posting to the
Ansteorran Pelican list):

> One can never have too much in the way of liquid assets.

I dispute that.  I think large pots of tempting money sitting idle is
a bad thing.

1) SCA money sitting unused is money that has come from people:
   specifically, it is chunks of site fees from branch events and
   donations from groups and people.  For site fees, in general I
   think it's better to provide cheaper events and let people keep
   that money.  For donations: let people donate what they like for
   whatever reason, of course -- but speaking only for myself, when I
   donate I want my donation to be used for Good Things.  If it sits
   idle, what's the point?

2) It's harder to manage larger amounts of money.  Fiduciary
   responsibility requires the treasurers to try to maximize return
   and safety.  For a small pot of money, that's not hard, 'cause
   there's not much that can be done with it.

3) A large pot of money is a temptation for lawsuits.  I'm told that
   lawyers indeed look at the wealth of their target in advising
   whether to sue for damages.  It's also a temptation to embezzle.

4) In terms of corporate structure, SCA Inc. is a monolith.  In law,
   the Board of Directors can take all the money from all SCA bank
   accounts.  (In practice, there'd be howls of rage; I'm talking
   law.)  If the corporation got into some major financial problem, by
   their fiduciary responsibility I *think* they'd be obligated to get
   money wherever they could legally.  If anyone has better info on
   these issues, I'd like to know.

Yes, any organization needs reserves to cover obligations
(subscription liability, for example).  Any organization needs a
cushion for sudden expenses; a rule of thumb I've heard suggested is
that an SCA branch should be able to lose everything on their big
annual event (site washout, say) and still be able to front the money
for their next one.  Sure, pad the cushion a bit more for good luck --
"chance favors the prepared mind" and all that.

But I believe there should be a limit *somewhere*.  (Note again: i
have no idea if kingdom is near that limit or no.)

Daniel de Lincolia
-- 
Tim McDaniel.   Reply to tmcd at crl.com;
    if that fail, tmcd at austin.ibm.com is my work account.
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