Thursday, October 29th 2009
The McMaster Students Union suffered the largest deficit in their history with the MSU budget ending the 2008/09 year with a staggering loss of $356,089. This occurred despite assurances by then vice president (Finance) Ian Finlay in January who described the budget as “healthy” and that, “it is my expectation to have a balanced budget or a small net surplus at the conclusion of the fiscal year.”
Since 1979, deficits have only occurred four times, including the 2008/09 year. Besides this year’s loss and the $241,000 loss from the 2007/08 year, the only other losses were $27,508 from the 1999/2000 year and $40,341 from the 2001/02 since 1979. In 2006/07, the MSU ran a surplus of $404,403. The last two years have seen a total of $597,395 in operating losses.
“Ombuds, Marmor and Quarters, now named Twelve-Eighty, were the three major factors and those account for almost 600,000-700,000 dollars of losses to the organization,” said MSU vice president (finance) Andrew Caterine.
Following the MSU not paying Ombuds for the past two years, the audit revealed an extra $100,000 in back payments to the Ombuds office, which the MSU shares its payment in with the university.
Other highlights include the $204,496 loss from the Marmor. Though no Marmor yearbook was released in the 2007/08 year, the Marmor still incurred a loss of $75,129. The yearbook’s 2008/09 loss of $204,496 was attributed to printing back issues, but Caterine could not say what the losses came from, responding, “I would defer you to the Marmor executive editor who is the expert.”
Caterine continued, “The vp finance portfolio is not to micromanage each particular service.”
Quarters, now named Twelve-Eighty, was also a major factor in the record-setting loss. In January, then vice president (finance) Ian Finlay said, “This year [Quarters / Twelve-Eighty] should be in a much healthier state than last.” In 2008/09, the campus bar lost $376,556. Current vice president (finance) Andrew Caterine continued, “I can’t speak on Mr. Finlay’s behalf… but what I do know is based on our figures thus far we have seen a successful profit during the month of September [of Twelve-Eighty] which we did not see last year.”
Caterine did note that the executive board and the Student Representative Assembly would have known these approximate numbers in April of 2009, when they approved both the renovations of the bar to the tune of $400,000, and the promotion of the manager who oversaw the losses.
Since its opening in 2002, Quarters / Twelve-Eighty has lost nearly $1.25 million, with almost $780,000 in the last two years. When asked how the executive board could promote the manager who oversaw those losses, Caterine said, “I do not wish to get into human resource issues because it’s not appropriate.”
MSU president Vishal Tiwari added, “This decision was made with everybody and we felt that this was just the right thing to do.”
One of the more interesting side notes to the budget was the disparity between what was the SRA approved budget, and what was reported in audited statements. Quarters / Twelve-Eighty was approved for a $38,000 loss by the SRA, to which the audit revealed a $376,556 loss. The same trend continued through other MSU business units, including the relatively new Shortstop and Undercovers. MSU by-laws ask the budget be reviewed by the SRA, which has not happened since March 2003.
MSU president Tiwari repeated that he “can’t comment on behalf of Mr. Finlay” on why the review hadn’t been completed.
Caterine added, “The finance committee will be asked to start conducting a budget review prior to the Christmas break… the actual review tentatively will be starting in January.”
Tags: Andrew Caterine, Deficit, MSU, Quarters, Twelve-Eighty, Vishal Tiwari
Hey, Did You Know?
You can be updated automatically when new comments are added using this RSS Feed. If you've never used RSS before, watch this to get started.
Loading ...
How about a poll of students to see what they actually want their MSU to do? Or, how about a paradigm shift so that the entire upper-management of the MSU stops talking about what-ifs and unrealistic projections? Or, maybe the MSU can take less of a “let’s see what happens” approach and actually FIX the problems they know exist instead of watching the organization slide. It’s a student’s union for the students, yet it seems like its running as a corporation more and more everyday.
My office hours are Tuesday and Wednesday, 9:30-10:20 MUSC 204.
Matt Wright
SRA Engineering
MSU Executive Board
@Matt, you’re implying the MSU isn’t a piece of shit.
It’s not. Three services mostly contributed to the deficit. There are others that maintained their goal of being revenue neutral and/or made profits (when technically they were not supposed to).
Why are they never mentioned?
Maybe because people only read the Sil when “bad news” is being reported…
… or maybe because the MSU has the largest deficit in it’s history.
Regardless of WHO lost it, the deficit is an undeniable fact. Who gives a shit if some of the services remained revenue neutral or made profits, do you want a pat on the back? You’re all in this together, and should expect much much more from your representatives.
I don’t care about which ones mostly contributed. Almost all of them had a deficit. The few that make a profit or are revenue-neutral are not mentioned because they are insignificant.
And the places are technically not supposed to make a profit? dumbest thing I’ve read today.
The MSU has lost sight of what it is to represent students. People can say all they want about “providing services for students”, but it’s becoming more and more about maintaining and upholding bylaws and operating policies instead of getting with the times and updating their way of thinking. Quarters should’ve closed for a year, undercovers should’ve closed late september, and the entire system should be re-align with the way students ACTUALLY think.
Yes, we need to destroy the institutionalized groupthink that dominates the culture of the MSU. Our SRA members need to ask “why” when their BoD reports that work has yet to begin.
We need non-confidence sections on our voting ballots so I can show my displeasure of many who run for elections.
MSU members should not be allowed to put anything to do with the MSU on their resumes
I agree that such a staggering deficit is unthinkable. From much experience in the service industry I would suggest that the MSU needs to take a harsher look at the managers running the various services that reported losses. I cannot blame the MSU members for being directly responsible for the deficit, but the managers of these services ARE responsible.
One of the things I’ve noticed as a patron of Quarters/twelve-eighty is that staff is not scheduled to fit the demand… For example, I ate at 1280 on Monday, and there were 5, literally, 5 waitresses hanging around not working, because there was only maybe 10 customers in the whole restaurant at lunch hour, and nothing for them to do! In addition to this, I saw that the chip truck has also opened for business, but the staff member working it appeared so bored with the lack of customers I almost felt compelled to buy something, just to entertain her! She mentioned that she had only sold 2 items since 10 am… Making less than 5$ in a day in sales for one staff member you pay minimum wage, EACH HOUR they’re present, is NOT efficient. I realize that opening a new service comes with cost, but where is the advertising? What motivation do customers have to visit the chip truck?
It is obvious that staffing is a serious issue at the pub, I cannot imagine the other services! If staffing, the most expensive resource, is being used so ineffciently, I cannot even imagine the usage of other resources! Think of food and dry product waste, cleanliness, maintenance and more! These are the things that seem small, but make a huge difference in cutting cost.
-A concerned student
Dear concerned student,
I agree with you. Changes do need to be made. There is a very high level of staffing in MSU services. These greatly contribute to the fiscal outlook of the services as well.
However, I also disagree with you. The problem rests within the Administration of the Student Union. Every issue is top-down, and those at the top are students who have forgotten that they get paid $30-some thousand dollars to make sure things work properly.
More often than not, the Board of Directors fail to make important decisions, or fail to enforce such decisions. This has disastrous effects that the students only learn about after the subsequent year’s problems.
To characterize my point: I recently attended a session of the SRA where a member asked the Vice-President Finance an important question: why had they not published the MSU’s Operational Budget. The VP Finance replied that they in fact had, and it could be found in the SRA documents section.
Let me clarify the problem with this answer. The SRA documents section is used to post the agenda and supporting documentation for the meeting. The documents in this section are considered as drafts, and include such gems as a proposal for a VP Finance statue.
While this draft had been ratified, we all felt as if the answer did not reconcile with Mr. Caterine’s promises of transparency, including a specific promise to post a contextualized budget and monthly financial statements.
Next it was my turn. I am well-versed in the finances of the MSU, having served on the SRA’s Finance committee, and authoring sections in the MSU’s General Accounting Manual. I had previous knowledge that the MSU’s ratified budget was in-fact incorrect, as it was written while Union Market had inflated financial statements (by $100,000+). Mr. Caterine was the one who had informed me of so, along with his intention to correct the budget at soon as possible.
No corrections have been made. It is not December, 8 months into the fiscal year, and the MSU is running on an incorrect budget. The MSU’s corporate bylaws stipulate that there must be a budget review done by September, and Mr. Caterine, a huge proponent of this review, had not even begun the process.
This is why the MSU’s finances are in shambles. Their Board of Directors are more invested in the perks of the job than the hardships. Their attitude is contagious, and the rest of the MSU’s services are unapologetically apathetic to financial responsibility.
Yes. Staffing is the largest money hole in 1280. But at this point in time, it does not compare to the money we waste paying our President and VPs to ignore us, turn their work email off their BlackBerries (their corporate BlackBerries), and treat our questions as misinformed and ignorant.