Governance is critical; you need to understand the best way of running a complex organization for the benefit of all its members. To get started, you’ll need a core group of volunteers who wish to form a club. These become your initial board of directors, and roles can be assigned to them. This group needs to decide why you are forming a club and what you really want it to do. Nearly every club is set up as a not-for-profit group. There are regulations in each province that govern non-profits and these can be found on-line. Clubs are strongly encouraged to register as a non-profit corporation in their province- this is fairly easy to do and not expensive.
A fundamental tool is a constitution, and this may be a requirement to register as a non-profit corporation with your local province. A constitution can be a very simple document, or extremely complex. A simple constitution contains clauses to
- define the name of the organization
- define the purpose of the organization
- define the relationship of the organizations to other organizations (i.e. affiliated with Cricket Canada or the Provincial association
- the bylaws.
The by-laws describe how the club will be run and organized in detail. By and large the main constitution will change rarely, the by-laws may change to adapt to circumstances.
The by-laws generally will contain the following items (Corporations Canada provide outline by-laws for non-profits)
- General items – usually definitions, definition of financial year, signing authorities, banking requirements
- Membership – who can become a member, and how, plus voting rights in the organization
- Matters Requiring Special Resolution
- Membership Dues, Termination and Discipline
- Meetings of Members; normally the Annual General Meeting; voting rights, quorum
- Directors; description of the overall management of the club, normally through a board of directors, elected by the membership.
- Meetings of Directors; notice, quorum, voting, chair
- Officers; normally President, Vice President, Secretary, Treasurer; description of duties, method of election
- Notices; how notice of meetings are provided
- Dispute Resolution; process to resolve disputes
- Effective Date
A number of clubs and organizations have constitutions and by-laws on-line; the best way of developing a constitution for a new club is to use one of these as a template. A good constitution is invaluable if disputes arise in the club as it clearly indicates how the club must be managed, and the processes for dealing with challenging situations.
Finances are critical for a club. Money can be raised from membership fees, from fund-raising, and from sponsorship. It is very important to have good financial controls in place to ensure that money is handled properly. A successful club can see large sums of money pass through it every year, and good controls are a protection against those monies being used inappropriately. A volunteer handling these sums is exposed to temptation, particularly if faced with difficult personal circumstances, and there are many examples of non-profits who have been defrauded out of large sums of money.
There are a number of controls that can be put in place to minimize the risk of fraud and to manage money well.
The club should set up a bank account; a number of banks offer special accounts for non-profits with low bank fees and other supports. It is strongly recommended that all cheques be signed by two board members rather than a single volunteer being completely responsible. If banking is done mostly electronically then at least two board members should have access to the account to monitor transactions
As far as possible all transactions should be by cheque or electronic transfer. Cash is harder to account for, and can go missing. All cash transactions should be receipted
All expenditures should be approved by the board, or at minimum the treasurer and president. Ideally any expenditure should be the subject of a motion passed by the board and properly minuted.
The Treasurer should provide a financial update at all board meetings, indicating the state of the account, and financial transactions since the last meeting
Formal audits and properly prepared financial statements can be expensive. However it is strongly recommended that the club’s financial procedures be at least reviewed by a qualified volunteer not directly involved- a member with an accounting background, for instance.
A basic financial statement should be prepared for the annual general meeting.
- joining national/ provincial organizations
- volunteer boards
Grants and sponsors
Money is always important. The prime source of income will be membership fees which need to cover the base operating costs of the club. It is hard, however to raise capital from the membership group. Active players tend to be young, with a fair number of students, and often it is a challenge getting membership or match fees from them. In order to build up funds for major projects it is better to look at alternate sources of revenue, through fund-raising, grants and sponsorship.
Fund-raising can be challenging as this is a highly competitive environment. A sporting organization for adults is never going to do well when competing against charitirs, or youth sporting organizations. The best way to fund-raise is to put on an attractive event that stands on its own merits. There are many on-line resources that offer fund raising ideas and there are companies that specialize in this area.
Applying for grants and looking for sponsors requires a highly professional approach to be successful, depending on the scale of support required.