Prepared for: March 2002 Board of Directors Meeting and Annual General Meeting

by: James C. Hendrix, Business Committee Chairman

 

OPENING

The Business Committee is charged with analyzing business related details of JCNA, with administering the JCNA Insurance Policies and with coordinating details of a limited audit.

Since JCNA’s independence from Jaguar Cars the budget has grown from slightly over $100,000 to $300,000 - $400,000. This is serious cash flow that requires this organization to have fiscal responsibility to itself and the members of the affiliated clubs. The Board of Directors is challenged with administration of this responsibility. Currently, with the addition of an Administrative Manager, this administration responsibility is in good hands. If you look in the mirror and ask yourself how you would want to control the flow of this much cash, you would agree that the JCNA BOD has made the right decision.

DETAILS

The areas that the Business Committee have been focused on are as follows:

I. Administrative Manager / Treasurer/ Roster Maintainer. Nelson Rath continues to do a fine job doing all 3 duties.

Recommendation: Continued analysis concerning the possible implementation of a JCNA office.

II. Accrual Accounting

2001 was the fourth full year of accrual accounting. We have achieved more knowledge of current financial conditions on a quarterly basis. This basis continues for 2002. The treasurer continues to get timely inventories from our volunteers for the numbers to be meaningful and to provide an actual useful financial condition.

III. JCNA Insurance

A) JCNA created the insurance program in ‘93/94. This was approved at that year’s AGM. By consolidating the General Liability Coverage into a group, there was a large cost savings to the individual clubs. Over the years, the JCNA budget has added additional types of coverage needed for the operation of JCNA. Extending some of that coverage to the affiliated clubs is part of this report. The coverage extension is due to requests for it and from advise of legal council.

B) We have again along with J.C. Taylor reviewed the companies that they place our various insurance types with. These insurance types are:

General Liability – provided for JCNA and affiliated clubs.

Directors and Officers Liability / Publishers Liability – for JCNA only.

Inventory Property/Casualty – for JCNA only.

C) Under General Liability there was a continuing discussion as to our coverage when non-member participation in competitive events such as concours, rallies and slaloms took place. JCNA created and implemented a special category named Event Membership.

D) Directors and Officers Liability / Publishers Liability Policy. This policy currently covers JCNA and the Jaguar Journal. A change is suggested. We need to consider extending this coverage to include the affiliated clubs. With this current society that likes litigation, it makes sense to add them. Cost per year will require a dues increase.

E) We increased our insurance coverage amounts this year. This was due to requests from the affiliated clubs.  The coverage is:

$3mm per Occurrence

$4mm General Aggregate

F) Insurance costs again for this past year, for the current coverage, have stayed within our budget parameters set when the program started even with the coverage increase. As JCNA has increased membership numbers we have had an increase of cost based on those totals. Again by shopping the insurance companies we do business with, our broker / agent, J.C. Taylor has kept the costs in line. The program has held costs since the ‘93/94 inception. In the future costs will rise for this amount of coverage. We will keep a close eye on that possible development. At this time no increase is needed for the current coverage. We must also watch our membership count. This too effects the dollars available for insurance.

G) A "certificate of insurance" has been sent yearly to all club presidents. The future plan was to give updates via the web site due to the time and effort it takes by mail. This could not be achieved due to potential liability issues related to printing off the general forms. A letter describing coverage is available if desired. Contact me at jhendrix@curtispack.com.

H) Any questions can be directed to me at any time concerning insurance and are encouraged. Since November we have fielded 5 situations and responded with answers.

IV. JCNA Budget

The budget is based on last year’s actual expenditures of which we see fluctuation with the cost and services provided going up. Special projects such as the 2003 Challenge Championship have an advanced budget and are held accountable by the Board of Directors. When these situations happen, the Board of Directors look at each specific item and make changes as they see fit.

The advantage of our budget process is being able to work off of a previous year’s numbers. Even though this is the case, we have taken the tactic the last 4 years to request from all committee chairmen and directors a specific budget for their area of responsibility. This has proven to be enlightening and moved some of the responsibility and accountability to those individuals. This has allowed us to not only look at what was projected to the budget process but to also determine if the budget was adhered to. Analysis only needs to take place based on if we don’t have the same expenditures in the current year as the previous year and what new programs have an effect on our costs.

V. JCNA Audit

The limited audit of 2000 is complete. 2001’s limited audit is scheduled for May 2002. The firm, R.L. Moore will again be used. They have experience with "not for profit" organizations like us.

JCNA is a relatively simple organization. The audit time frame was set up to work around the tax season. It gave us better focus and service choosing this time frame. This year an additional subject of the review is income taxes.

VI. Administrative Manager (AM) addition. This position has been implemented as presented at March 2000’s AGM.

JCNA needed a face and clearing house where information is funneled. The purpose is to consolidate some of the efforts of JCNA into an office environment. Analysis of this job includes many of the clerical duties currently done with the handling of checks as well as the same duties required for roster maintenance. JCNA has expanded this responsibility into a full time position that handles these items and more details and functions of what JCNA does. This helps JCNA control its functions easier. It also helps to identify future areas of attention. The 888 number is answered here. By the way it is answered at nearly all hours. Very good service.

The next step is to now take additional duties into the job of Administration Management. The plan is to look at areas that can help JCNA grow. Areas of additional duties being looked at for 2002 are:

Passport to Service

Affiliated JCNA Club Sponsorship by Jaguar Cars

We have had a trial "subscription method" (SM) going on with the St. Louis and Tulsa clubs. This was created to assist with dealer supplied memberships. It has taken additional time to administer since lists of drop offs and new additions go back and forth monthly. The AM advises the club who is dropping off with the effective date 90 days in advance. It is the job of the club to pursue them. Renewals have been less than desired.

OPINION & FURTHER TEST: If JCNA or the club had a formal program to pursue those dropping off, it would at least have the best method possible. Trial is being done in St. Louis by the local club. Started at the end of August. A suggestion for a procedure is as follows:

1. Upon notification, 90 days out, send a form letter with an invoice. (Possibly include a way to pay with credit card to make it easy for the renewing members who is vacillating.) Done without credit card option. Tracking results.

2. If not renewed 30 days before expiration, send out a second reminder again with an easy way to pay the dues.

3. Call or suggest a call by the club if they drop off.

RESULT: The method takes additional time to implement as compared to the once per year mass submittal as is currently practiced. The St. Louis club has implemented items 1-3. Additional discussions will continue with other National Clubs and how this is done in their organizations. Future reports will give those results. NO CHANGE IN THE CURRENT DUES COLLECTION METHOD IS SUGGESTED.

JCNA is poised to grow with the investment Ford has made into new Jaguar products. JCNA has reacted now so that it can control growth and maintain membership. Improved communication is a key in having our current membership continue to be happy with the services offered. If you look at the results of the JCNA survey, you will see that we have to work on maintaining of membership. This is the next area where JCNA needs to focus and improve.

The next area to consider is to look at the procedures of regalia, trophies and publications. We can start to detail what the procedures are with our volunteers to determine the amount of work that would be needed to accomplish each task. This will define the details now. It will allow us to plan for a time if volunteers no longer want to do those jobs.

VII. Event Membership

This allows current non-members of JCNA to be able to attend and participate in our competitive event schedules. Competitive events are defined as concours d’ elegance, rallies and slaloms. Individuals are eligible to win trophies in whatever class they are entered in. This does allow the individual to compete for the whole year in any JCNA competitive event, however, they are not eligible for year end trophies or placement.

The cost of this program is $10.

An advantage of this program is to allow the local clubs the option of being able to have joint events with other organizations. The main reason is to spread out costs over more participants when rental of facilities becomes a major part of putting on that event.

This was created for a special purpose to get more participation in events that would help defray costs. There were 71 participants in this program in 2001. This is a huge improvement over 2000. Remember that if outside non-JCNA members participate in the events noted and are not signed up as an Event Member, the local club bears that liability if there is a problem.

Any questions concerning this program can be fielded by me and are welcome.

 

VIII. Multi year plan and JCNA Direction

- Add an office of JCNA, its own address

- Bring the volunteer services into the JCNA office as the job gets too large for them to do.

- 5 – 6500 – 1 person

- 6501 – 12,000 – 2 people

- 12,001 – 18,000 – 3 people

- etc.

- Evaluate dues to cover costs.

IX. Jaguar Cars – JCNA Storage

Jaguar Cars informed JCNA that they would no longer be able to store the archival and other items they held. So far some of the old Jaguar Journals have arrived along with a minor quantity of archival documents. JCNA has contracted for a temperature controlled storage facility with full access. The transfer of items will continue.

X. Jaguar Journal – Editor Contract

A new contract is completed with Mike Cook of Plain English to continue as Editor of the Jaguar Journal. Details were finalized with JCNA Legal Council after being approved by the JCNA Board of Directors in July. The contract will continue to be addressed as directed by the Board of Directors.

XI. JCNA Dues INCREASE

JCNA has not increased dues since ’93 when the JCNA Insurance Program went into effect. This changed the dues from $15.00 to $17.00. At the March 2000 Annual General Meeting (AGM) the Board of Directors and the Business Committee advised all delegates that this review of dues would be evaluated every year. JCNA is a bargain compared to other car clubs that have dues of $22.00 - $30.00.

For the last several years the Business Committee has looked at the financial statements and expenditures of JCNA and has seen nearly all costs increase. These include: postage, insurance (plus additional coverage), Jaguar Journal printing costs (32 to 36 pages was part of that as well as an overall growth from 16 – 36 pages), Administrative Management position addition, committee costs the Jaguar Journal redesign and many others. These costs have been somewhat offset by increases in membership from 3,500 – 6,400 members.

The tasks of a volunteer organization have been stretched due to membership size. This resulted in the addition of an Administrative Manager to run many of the daily tasks.

The success of the general operations as well as increased membership has allowed JCNA to continue to be profitable. These profits have continued to be reinvested in JCNA by creating a new look and structures of the Jaguar Journal and the addition of an Administrative Manager.

As JCNA continues to grow in size the requirement to continue with the proper administration and services provided also need to grow. This will require constant analysis of the dues structure to support this activity. 2001 was a pivotal year. Many things were going on at the same time that were interrelated. The success of these and some of the continued related operations help with the ability to control dues. JCNA was a break even organization when you take out the positive cash flow resulting from the 2001 Challenge Championship.

If the insurance addition of Directors and Officers / Publishers Liability coverage is to be extended to the individual clubs, there will need to be a dues increase. This is based on the number of memberships in the overall organization.

It is recommended that a dues increase be approved by the general membership at this AGM. JCNA should increase dues to cover extending coverage to the affiliated clubs for Directors and Officers / Publishers Liability Insurance. As a result of JCNA being break even without the Challenge Championship it is recommended that a general increase in costs for running JCNA also be approved. A $3.00 dues change is suggested to bring the total dues to $20.00. This would have an effective date of January 1, 2003.

Future yearly analysis will continue to take place. If warranted, future increases will be suggested.

Submitted by:

James C. Hendrix

Roster:

Jim Hendrix - Chairman
Knick Curtis
Barry Greenstein
John Horen
George Keller
Mike Ksiazek
Brock McPherson
Nelson Rath

cc: Dick Howe, JCNA Secretary

 

 

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