I am not a fan of the combined offices. Saying that, in some lodges it is a necessity but I believe in a combined secretary, treasure offices they should be required to do quarterly audits.
First, Lodge viability has to be considered if it is impossible field a competent set of basic officers for a Lodge of Entered Apprentice Masons. Second, though fraternal in nature, our Lodges are businesses like any other and should follow good business practices. We have a tendency to behave as if we're outside of the real world sometimes. A segregation of financial duties in business is essential for proper accounting, transparency, and the protection of the corporation's assets and integrity. In the charitable nonprofit world we are required to practice accountability - a lack of segregation would be a black mark on an audit. Financial abuse, sadly, has occurred in our Fraternity, so trust and hope as a strategy have proven to be costly both in dollars and credibility. Segregation of duties minimizes this possibility.
It comes down to risk, honestly. If a lodge is small, and has just a basic checking and savings account, and perhaps a modest mutual fund investment, then it shouldn't be an issue. There are other ways, in that situation, to safeguard against theft. You could simply have each WM get on the accounts where they can monitor transactions, and make sure annual audits are completed. The WM should also be signing the secretary's cash book monthly to review income and expenses. A small lodge would have few transactions to worry about.
If it's a more wealthy lodge, with hundreds of thousands of dollars in investments and lots of activity, there is no way the sec/treas should ever be allowed.
And never with a temple board as there are too many big ticket transactions normally written checks for.
I am aware of cases in our jurisdiction where the secretary and treasurer's positions have been entrusted to one man, and that man abused the trust by embezzling from the lodge. It has happened more than once. Checks and balances are necessary, not so much to prevent fraud, but to assure the Brethren that their finances are being well-looked after. The very first lesson we are taught as Masons is TRUST. Trust in our Brethren, trust in our officers, trust in our Fraternity. We need to know that our financial well being is being guarded and shepherded by good men. If a lodge cannot come up with one additional body to fill either position, perhaps that lodge needs to take a long, hard look at its potential for survival. I have been Secretary for a lodge, and appreciated having a Treasurer looking over my shoulder. Every cent was accounted for, every "i" dotted and "t" crossed. Having that accountability made me comfortable in the performance of my duties for the lodge.
That being said why doesn't Grand Lodge of Washington have a Grand LodgeTreasurer. They are running a budget in the hundreds of thousands and investments in the millions. The Grand Lodge Treasurer does not need to be a full time position like Grand Secretary. A partime Treasurer could do the job for a small fee and provide oversight that was mentioned in previous responses to this question. I firmly believe a resolution needs to be passed to elect a Grand Lodge Treasurer and leave the code as written for the lodges
For those in Washington, please review your Lodge by-laws Article IV Standing Committees as this provision requires a finance committee to review all payments prior to disbursement. That being said I am not a fan of the combined office but I do see the need in some cases. Remember do not cast stones if you live in a glass house. Audits (or in our case, reviews) are only as good as the training/experience of those appointed to carry out the duty. Additionally, we tend to appoint the same Brothers to the same positions in multiple Lodges or organizations and then wonder when problems occur. A Treasurer's report that consists of "we have money" should not be tolerated but yet we sit by and let it happen month after month.
For our lodge, which I hope is fairly typical of all lodges, we pass a budget every year, items within the budget don't need to be reviewed by the finance committee. Major purchases are discussed by the finance committee outside of that.
Our treasurer provides a very thorough spreadsheet that is emailed out to the officers prior to the upcoming stated meeting, and read in lodge during the treasurer's report. That spreadsheet details everything, including interest earned monthly and ytd as well as month by month changes.
And finally, an audit is performed annually for both the temple board and the lodge accounts. Because the secretary and treasurer keep meticulous records, the lodge audit is always very straightforward. The temple board audit is relatively simple, since it just has a savings and checking account, and comparison to bank statements is pretty basic.
I was elected treasurer for the now defunct John Paul Jones Lodge in Gig Harbor. I would be the last person you would want to act at treasurer, as I am terrible with math and can't stand dealing with it. But I did it because no one else would. When I took over, the accounts were a mess. The last person who managed it did the bare minimum he needed to do to keep things running (depositing money and writing checks) and didn't try and sort out the issues. Not really his fault, he only took the job because no one else would either, but quit after a few years and told the lodge to find someone else. I didn't blame him.
But, with the immense help of the lodge secretary, we turned it all around. It took several years, including driving to past secretary's houses out of the district, to retrieve bank records and account information, pulling funds out of four separate CDs earning shit interest, and starting to maintain proper treasurer/secretary records, up until the lodge merged with Port Orchard a few years later.
We're blessed in our lodge of having a great secretary/treasurer team, that are great stewards of the lodge funds. It helps that they have been in the same positions for over a decade.
As Masons, we are supposed to be honorable men, and our word is our bond. However we are still human beings and we make mistakes and can be tempted to do things that are not in the lodge's best interest. If I were asked to take both positions, I don't think I could in good conscience, as I WANT to have checks and balances against myself to make it less likely to make a critical mistake, and so my integrity is protected. If a lodge cannot field these two offices, I agree with Ken that lodge viability has to be considered. It's probably time to merge.
I spent the first 7 years of my career as an auditor/CPA and I can tell you that with respect to internal controls the guidelines in the WMC are inadequate. What's missing is full transparency, which must include verification of transactions to external documents, like bank statements. If the Finance Committee merely approves a list of proposed expenditures without also tracing payments to a bank statement the Secretary/Treasurer, the Treasurer, or any Brother with signature authority can have their way with the Lodge funds. Routine review of external documents with bank reconciliations, which must be done by someone other than Brothers with check signing authority, significantly strengthens controls. As to separating the Secretary and Treasurer jobs, it's a question of workload and competence. It can tend to strengthen controls but without third party review of external documents it falls short.
An absolute mistake to comingle secretary and treasurer. The code needs to be changed
I am not a fan of the combined offices. Saying that, in some lodges it is a necessity but I believe in a combined secretary, treasure offices they should be required to do quarterly audits.
First, Lodge viability has to be considered if it is impossible field a competent set of basic officers for a Lodge of Entered Apprentice Masons. Second, though fraternal in nature, our Lodges are businesses like any other and should follow good business practices. We have a tendency to behave as if we're outside of the real world sometimes. A segregation of financial duties in business is essential for proper accounting, transparency, and the protection of the corporation's assets and integrity. In the charitable nonprofit world we are required to practice accountability - a lack of segregation would be a black mark on an audit. Financial abuse, sadly, has occurred in our Fraternity, so trust and hope as a strategy have proven to be costly both in dollars and credibility. Segregation of duties minimizes this possibility.
It comes down to risk, honestly. If a lodge is small, and has just a basic checking and savings account, and perhaps a modest mutual fund investment, then it shouldn't be an issue. There are other ways, in that situation, to safeguard against theft. You could simply have each WM get on the accounts where they can monitor transactions, and make sure annual audits are completed. The WM should also be signing the secretary's cash book monthly to review income and expenses. A small lodge would have few transactions to worry about.
If it's a more wealthy lodge, with hundreds of thousands of dollars in investments and lots of activity, there is no way the sec/treas should ever be allowed.
And never with a temple board as there are too many big ticket transactions normally written checks for.
I am aware of cases in our jurisdiction where the secretary and treasurer's positions have been entrusted to one man, and that man abused the trust by embezzling from the lodge. It has happened more than once. Checks and balances are necessary, not so much to prevent fraud, but to assure the Brethren that their finances are being well-looked after. The very first lesson we are taught as Masons is TRUST. Trust in our Brethren, trust in our officers, trust in our Fraternity. We need to know that our financial well being is being guarded and shepherded by good men. If a lodge cannot come up with one additional body to fill either position, perhaps that lodge needs to take a long, hard look at its potential for survival. I have been Secretary for a lodge, and appreciated having a Treasurer looking over my shoulder. Every cent was accounted for, every "i" dotted and "t" crossed. Having that accountability made me comfortable in the performance of my duties for the lodge.
That being said why doesn't Grand Lodge of Washington have a Grand LodgeTreasurer. They are running a budget in the hundreds of thousands and investments in the millions. The Grand Lodge Treasurer does not need to be a full time position like Grand Secretary. A partime Treasurer could do the job for a small fee and provide oversight that was mentioned in previous responses to this question. I firmly believe a resolution needs to be passed to elect a Grand Lodge Treasurer and leave the code as written for the lodges
Cheers
For those in Washington, please review your Lodge by-laws Article IV Standing Committees as this provision requires a finance committee to review all payments prior to disbursement. That being said I am not a fan of the combined office but I do see the need in some cases. Remember do not cast stones if you live in a glass house. Audits (or in our case, reviews) are only as good as the training/experience of those appointed to carry out the duty. Additionally, we tend to appoint the same Brothers to the same positions in multiple Lodges or organizations and then wonder when problems occur. A Treasurer's report that consists of "we have money" should not be tolerated but yet we sit by and let it happen month after month.
For our lodge, which I hope is fairly typical of all lodges, we pass a budget every year, items within the budget don't need to be reviewed by the finance committee. Major purchases are discussed by the finance committee outside of that.
Our treasurer provides a very thorough spreadsheet that is emailed out to the officers prior to the upcoming stated meeting, and read in lodge during the treasurer's report. That spreadsheet details everything, including interest earned monthly and ytd as well as month by month changes.
And finally, an audit is performed annually for both the temple board and the lodge accounts. Because the secretary and treasurer keep meticulous records, the lodge audit is always very straightforward. The temple board audit is relatively simple, since it just has a savings and checking account, and comparison to bank statements is pretty basic.
I was elected treasurer for the now defunct John Paul Jones Lodge in Gig Harbor. I would be the last person you would want to act at treasurer, as I am terrible with math and can't stand dealing with it. But I did it because no one else would. When I took over, the accounts were a mess. The last person who managed it did the bare minimum he needed to do to keep things running (depositing money and writing checks) and didn't try and sort out the issues. Not really his fault, he only took the job because no one else would either, but quit after a few years and told the lodge to find someone else. I didn't blame him.
But, with the immense help of the lodge secretary, we turned it all around. It took several years, including driving to past secretary's houses out of the district, to retrieve bank records and account information, pulling funds out of four separate CDs earning shit interest, and starting to maintain proper treasurer/secretary records, up until the lodge merged with Port Orchard a few years later.
We're blessed in our lodge of having a great secretary/treasurer team, that are great stewards of the lodge funds. It helps that they have been in the same positions for over a decade.
As Masons, we are supposed to be honorable men, and our word is our bond. However we are still human beings and we make mistakes and can be tempted to do things that are not in the lodge's best interest. If I were asked to take both positions, I don't think I could in good conscience, as I WANT to have checks and balances against myself to make it less likely to make a critical mistake, and so my integrity is protected. If a lodge cannot field these two offices, I agree with Ken that lodge viability has to be considered. It's probably time to merge.
I spent the first 7 years of my career as an auditor/CPA and I can tell you that with respect to internal controls the guidelines in the WMC are inadequate. What's missing is full transparency, which must include verification of transactions to external documents, like bank statements. If the Finance Committee merely approves a list of proposed expenditures without also tracing payments to a bank statement the Secretary/Treasurer, the Treasurer, or any Brother with signature authority can have their way with the Lodge funds. Routine review of external documents with bank reconciliations, which must be done by someone other than Brothers with check signing authority, significantly strengthens controls. As to separating the Secretary and Treasurer jobs, it's a question of workload and competence. It can tend to strengthen controls but without third party review of external documents it falls short.