On May 14, 2017 at 17:58 evan@telly.org (Evan Leibovitch) wrote:
On 14 May 2017 at 17:27, <bzs@theworld.com> wrote:
That said I would agree that there is a tendency when running any business that "excess" cash tends to get allocated one way or another barring an iron-willed commitment otherwise which is not what I'd expect of an organization structured like ICANN.
I don't know about that.
I've been involved with some nonprofits that believe it imperative to, as possible, maintain a reserve fund to deal with unintended or unanticipated circumstances. The amount of this reserve may be capped by taxation authorities who don't want it too high, but having a substantial fund to guard against liability, especially in uncharted territory such as ICANN's, is certainly prudent.
The usual rule of thumb is one year's gross expenses though it's fairly common to attach lists of exceptions to that number such as risks in the future. For example the cost of a conference disaster*, or pending lawsuits which wouldn't be reflected in backwards looking budgets. * Since ICANN doesn't seek cost recovery on conferences that one probably isn't apt but I've seen it come up where there were conference registration fees and/or trade show fees which were expected to recover expenses, often hundreds of thousands of dollars at risk. And in that case what happens if there's an airline strike, weather, etc which shuts down a conference? It's not difficult to imagine similar scenarios. -- -Barry Shein Software Tool & Die | bzs@TheWorld.com | http://www.TheWorld.com Purveyors to the Trade | Voice: +1 617-STD-WRLD | 800-THE-WRLD The World: Since 1989 | A Public Information Utility | *oo*