Policy Number: 10-001

Policy Title: Handling of Funds for Third Parties

Date First Passed: October 21, 2010

Date(s) Amended:           

From time to time, SASCI may be asked to act as a financial agent for other parties.  The purpose of this policy is to provide guidance to the Board, the Manager, and any third party regarding the appropriate management of third party funds.

Prior to agreeing to serve as a financial agent for any third party, the Board of SASCI will ensure that the mandate of the third party is deemed to be consistent with SASCI’s mandate.  SASCI will not serve as a financial agent for any third party whose mandate is not considered to be consistent with SASCI’s mandate.

Prior to agreeing to serve as a financial agent for any third party, the Manager and/or the Secretary/Treasurer of SASCI will assess the risk and liability associated with the third party and third party activity and will make a recommendation to the Board.  SASCI will not enter into any third party agreement where the risk and liability is deemed to be unacceptable to the Board.  If the risk and liability is deemed to be acceptable, SASCI will secure indemnity or a waiver of liability for any action by or on behalf of the third party and/or will secure a fee to cover any necessary liability insurance.

Any arrangement by which SASCI serves as a financial agent for a third party will be documented in an agreement signed by both parties, such agreement to address:

• the responsibilities of SASCI;
• the indemnification of SASCI for liabilities associated with third party actions;
• the manner in which payments or disbursements are to be made by SASCI on behalf of the third party, including approval procedures;
• the administrative fee to be charged by SASCI, which may include a fee for liability insurance;
• project timelines;
• record-keeping, auditing, and reporting obligations;
• privacy issues;
• conditions for termination of the agreement; and
• the disposition of residual funds.      

Notwithstanding reporting required by or to the third party, the Manager and/or Secretary/Treasurer will be responsible to ensure financial reporting for third party funds is provided to the Board together with regular financial reporting (i.e., at each regular Board meeting). 

SASCI will levy an administrative fee against the budget of the third party to cover the costs of financial administration, unless otherwise approved by the Board.  The standard administrative fee will comprise 8% of the total project budget, unless otherwise agreed with the third party.  As noted above, an additional fee for liability insurance may be levied, such fee to be commensurate with the degree of liability and risk deemed to be associated with the third party and third party activities. 

If an agreement with a third party constituted pursuant to this policy extends longer than one calendar year, the agreement will be reviewed annually or at an appropriate frequency to ensure ongoing alignment with SASCI’s mandate, acceptable risk and liability, and appropriate compensation.  If and as required, the third-party agreement will be amended to adjust fees or make other changes necessary to address any concerns identified by the Board.  An agreement may be terminated if the mandate is no longer aligned, or if the risk and liability are deemed to be unacceptable, or for any other reason given by the Board, consistent with the provisions of the third-party agreement.

Any third-party agreement entered into by SASCI is also subject to other policies established by the Board.