FINANCE
Mosque Board Financial Literacy Matters Overcoming one’s fears of numbers BY SADIA QURESHI
A
n often-overlooked aspect of Islamic centers’ governance is their board members’ financial literacy. While highly skilled in their own areas of expertise, many of them often lack relevant training and experience in this regard. In addition, their meetings and interactions focus more on discussing program accomplishments or legal matters. However, the mosque’s management must help these individuals embrace and understand financial data. Achieving this goal, with some creativity and perseverance, can add tremendous value to achieving Islamic centers and nonprofits’ missions.
WHY ARE PEOPLE INTIMIDATED BY NUMBERS?
Let’s admit it: Numbers are rare in meetings or discussions (“unfamiliar”); financial numbers and spreadsheets are simply dry, somewhat boring and cause anxiety; require you to pay serious attention (“disruptive”); and mean that a learning curve is right in your face. So, your immediate response is an entitlement to self-exemption because if it’s never been your “thing” or natural aptitude. Numbers also mean a lot of responsibility, because a small error can cause great harm. And thus, the common attitude is “Since I didn’t engage with financials, I’m not responsible.” But one should be aware of just how costly this attitude might be.
For example, the famous 2018 case of Missing Oxford Comma where Portland, Me., dairy delivery-truck drivers won $5 million from their employer for years of unpaid overtime wages, all because of how commas were used in state legislation governing overtime payments. Also, in 1872, the United States Tariff
THE ENSUING STRESS AND ANXIETY CAUSE PEOPLE TO AVOID NUMBERS. LACK OF SUPPORT FROM THOSE WHO UNDERSTAND FINANCIALS JUST INCREASES THE PROBLEM. HOWEVER, BOTH OF THESE ISSUES CAN BE RESOLVED BY INTENTIONALLY CREATING A CULTURE IN WHICH THEY ARE A NORMAL PART OF REGULAR BOARD MEETINGS OR INTERACTIONS, PHONE DISCUSSIONS, PROGRAM REVIEWS AND GOAL SETTING.
Act, as originally drafted in 1870, included an unwanted comma that cost taxpayers nearly $2 million (the equivalent of $40 million plus today). In addition, numbers require transparency and accountability, especially with reconciliations, which means “a lot of extra high responsibility work” and are seen as a “specialty” — someone else’s job. “That’s why we hired an accountant. Why should I spend time on something I’m not responsible for?” The ensuing stress and anxiety cause people to avoid numbers. Lack of support from those who understand financials just increases the problem. However, both of these issues can be resolved by intentionally creating a culture in which they are a normal part of regular board meetings or interactions, phone discussions, program reviews and goal setting.
IMPROVING THE BOARD’S FINANCIAL LITERACY
➤ Offer financial literacy workshops to all members. These trainings may include, among others, financial planning, budgeting, investing, understanding and reviewing financial statements, financial internal controls, financial reporting, budget reconciliations and how to spot errors or discrepancies. As hiring professional trainers can be costly, collaborating with other Islamic organizations for subject matter experts or willing volunteers can help save funds. In exchange, you may offer some type of cross training in your organization’s area of expertise. You can also periodically screen and share free online resources for your board and staff. Help the board understand the importance of investing excess funds and cash savings to protect the institution from inflation and the impact of donor fatigue or lapse. For example, the North American Islamic Trust (NAIT; info@nait.net) offers “free” customized financial literacy workshops. With their expertise in finance and investing, they can also help with your mosque’s halal investing and sustainable fund development goals.
MARCH/APRIL 2022 ISLAMIC HORIZONS
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