Art Gallery gets a bail out from the city - while city finance people make bean counters out of curators.

News 100 redBy Pepper Parr

May 15th, 2019

BURLINGTON, ON

 

Things got a little sticky for the Art Gallery of Burlington (AGB) – the cash didn’t flow the way they needed it to flow.

It was vision and cultural courage that got this piece of art outside the Arts Centre. The artists in the city are going to have to bring the vision to city hall and press hard for the cultural courage that will be needed to make the city a place with a cultural base.

It graces the entrance to the Art Gallery – many don’t understand what it means.

The AGB is one of the local boards Burlington created to provide services that a community may value but that do not fall within the usual service delivery of the municipality. These services may be as varied as economic development service or arts and culture. The City of Burlington has relationships with several boards:

• Aldershot Business Improvement Association
• Art Gallery of Burlington
• Burlington Downtown Business Improvement Association
• Burlington Economic Development Corporation
• Burlington Museums Board
• Burlington Public Library Board
• Burlington Theatre Board
• Tourism Burlington

Local Boards - 2019 budget

Burlington Theatre Board is the corporate structure for the Performing Arts Centre. The City pumps more than a million every year into Performing Arts and just shy of a million into the Art Gallery. The total into all the local boards is in excess of $15 million.

These organizations have service level agreements with the City which outline services provided by the City to the boards. Over the past few years, some boards have requested additional accounting services. It made little sense for each of these Boards to have their own accounting department. Bunking in with the city made more sense and better operational reviews. The city has already begun to work with several of the Boards and some changes have taken place since January 2017 in accounting and financial reporting services provided to the boards.

Robert Steven AGB

Robert Stevens, Executive Director of the Art Gallery.

In 2017, a request was made to the Controller and Manager of Financial Services by the Executive Director of the Art Gallery to consider providing accounting services to the Art Gallery. The concern driving this request was that financial information being received internally was not timely due to cumbersome accounting procedures and therefore was not useful for proactive decision making.

Finance management determined that it would be useful to understand the financial processes at the Art Gallery before deciding to provide accounting services. Finance staff provided support in developing accounting policies and procedures, cash flow forecasting, budget preparation and other financial processes beginning in the summer of 2017.

Through the work performed by Finance staff it became evident that the Art Gallery was experiencing cash flow challenges. To help reduce the likelihood that the Art Gallery would have to increase its line of credit, the City provided additional funds over and above the budgeted operating grant. The City provided an additional $265k in 2017 to assist with the cash flow challenges.

In 2018 the City expanded its financial services to the Art Gallery to include accounts payable and accounting services. The additional services included bringing the Art Gallery into the City’s financial system, SAP. Finance staff continue to support the Art Gallery with financial reporting and cash flow analysis. This support includes attending the Audit and Finance Committee meetings of the Board. More timely, accurate and complete financial reporting is provided to the Board and management of the Art Gallery. The provision of accounts payable services enabled a cash flowing of operating expenses through 2018. At year end the cash flow extended to the Art Gallery resulted in an intercompany payable to the City of $424k.

Finance staff have been on site at the Art Gallery two days per week up to and including the audit of the 2018 financial statements which concluded in March 2019. Art Gallery staff have been mentored so that they are now able to assume responsibility for more of the financial management. Finance staff will continue to provide support but will have less of a presence at the Gallery. Finance staff continue to look for additional opportunities to support the Art Gallery in establishing good financial management practices. The focus in 2019 will be to reduce dependence on the City for cash flow support.

During 2018 the Art Gallery held a successful fundraising event which netted funds of $181k. The Board of Directors of the Art Gallery has requested that approximately $60k of the funds be held in a reserve fund for future needs.

Some financial stability for the Art Gallery

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1 comment to Art Gallery gets a bail out from the city – while city finance people make bean counters out of curators.

  • Judy Christie

    would it not be wonderful if and when the Hotel on the lake is gone, the AGB would be moved there. Imagine Art In The Park in Burlington!!! Kind of a dream?

Leave a Reply to Judy Christie Cancel reply