IT Asset Policy for a Non-Profit

At the Executive Meeting today, several members indicated they would like a clearer presentation of the proposed policy which would look at assets from the perspective of the Corporation as a whole, the initiation of a specific project, the termination of a specific project, and the dissolution of the Corporation. The following re-frames the ideas presented earlier and responds more specifically in a ‘life-cycle’ context.

Policy/practice on integrated systems and shared resources

From its inception the ORGANIZATION has insisted on the following to ensure productive use of information technology.

First, each person working at this organization is to have access to a networked computer workstation at his/her usual workspace. Unlike many other organizations, each staff workspace contains the complete configuration necessary for full access to people and information on the network and around the world. In contrast, other organizations require that staff schedule time at shared computers in order to do the computer work. In practice, this means that new projects which bring in additional staff, must also bring in the funding for required system expansion. Most frequently, this means, a new computer. Occasionally, this has meant a new server. It always includes a share of the supporting network infrastructure (cables, extensions, licenses, etc).

Second, each workstation contains identical capabilities, to the degree that available technology and budgets permit. This ensures that each staff person has access to the same range of application and communication tools. This reduces both technical support required for setup and familiarization of new staff. It means that a worker or student who comes in infrequently can sit at any workstation and do his/her work without having to assign them a dedicated space. In practice, this also means that whenever a particular generation of computer can no longer perform the standard application requirements, it is mothballed. This organization has survived the shift from XT’s, 286’s, 386’s, 486’s and Pentiums along with the shift from command line DOS to Windows applications. Our current computers are ready for the switchover to the latest version of Windows. We could have set up [employment project] with outdated equipment from our mothballed collection and bought very cheap, outdated technology. The end result would have been training on yesterday’s applications, no flexibility to upgrade client skills, and no ability to run training sessions on today’s business software.

Most equipment lasts four years. Whenever a piece of equipment is more than two years old and suffers major breakdown, the working parts are removed and used for on-site replacement in other breakdowns. This practice means that we can solve almost all equipment breakdown without resort to outside technicians. Equipment which is incapable of running the common applications, are stored in the basement. This means we do not make a new project use equipment and applications which we no longer use and which we cannot support.

Third, all systems are inter-linked and each capability and resource is available for every person, activity and project. This last point is critical when considering disposal. During the developmental stage, projects often make use of existing resources. Once they become a more permanent feature, we insist that they obtain sufficient funding so that their equipment needs will last the anticipated duration. If a project is likely to be around for less than two years, we require a payment equal to the current commercial equipment lease terms. While we can identify certain individual workstations bought for projects, we can’t separate the contribution to or the use of shared system resources by project. For the past several years, project funds, not core dollars, have been used to bring in new equipment and replace older equipment.

The above practices have been responsible for the information system success of OPC. Had we given in to the many times when projects or funders tried to get out of paying for equipment which meets our standards with the argument that, ‘…we only need wordprocessing.’, we would now be looking for tens of thousands in equipment upgrades. [Employment project] specifically, would have been training clients on equipment and software which is no longer in majority use in the workplace. This organization would not be able to use the facilities for training or be in a position to consider a small office ‘hotelling’ option.

Equipment and services available to projects under development

Projects under development by this organization or by voluntary groups which we support have access to the full range of capabilities offered. Again, a recent example is [project name]. They were given full system access and technical support to get going. We were not certain that there would be funding. When funding was obtained we acquired the best available systems for their use. They now have the best equipment on our network.

Equipment and services obtained for funded projects

Our working definition of the ‘best available system’ is to buy the equivalent of last year’s Cadillac. That is, we don’t buy the most expensive current PC. We buy the previous model. Over the years this practice demonstrates the best balance of initial capital and life-span utility of the equipment. Projects end and equipment becomes less able to meet increasingly demanding software requirements. Such equipment is then moved to less intensive use areas, converted into network support equipment, taken apart for parts or, as a last resort, put into storage. The goal is to ensure that the equipment we purchase today will last for three to four years as an end-user tool, then have continued functional use, regardless of residual value, for as long as possible. We do not buy equipment to simply meet the life-span requirements of a specific project.

Furthermore, larger scale projects require additional or upgraded network resources. Specifically, both [project one] and [project two] funding were used to provide new servers. These servers now support all activities everywhere on our network.

Disposal of equipment after project completion
The handbook currently notes the following about computer equipment:

“2) Ensure that the repair-free life-span of computer equipment in constant daily use is approximately three to four years. Given the high costs of repairs and component replacement parts, the organization recognizes the depreciation of this equipment consistent with general accounting principles.”

Over the past ten years, the combination of growth, project and equipment life-cycles has been such that there is no active equipment which is unused. There is old equipment in storage, but it is not suitable for our current system application requirements. We now face the possibility of organizational down-sizing. There are two general categories of equipment purchased by projects which need consideration.

First, network equipment. It is simply not feasible to shutdown, disconnect and sell off network equipment. Once agreed to in the negotiation of operating budgets for projects, this equipment must remain with the core organization.

Second, individual workstations. If such equipment is deemed surplus to the continuing operations of the corporation, it should be made available to the original funder of the project or disposed of according to the funder’s requirements. In the event of more than one funder making a claim on the equipment, it should be sold at the best available price and the proceeds divided in proportion to the funding of the project.

The Board may also consider making obsolete and unclaimed equipment available to staff at a reduced rate. Equipment would not be declared obsolete unless it is at least four years old and no longer suitable for current applications.

Disposal of equipment at dissolution of the Corporation

Our current bylaws indicate the following:

“36. DISSOLUTION

In the event of dissolution, all remaining assets (capital items, furnishings and computers) will be returned to the province of Ontario as an agent of Her Majesty as described in paragraph 110(1) (b) of the Income Tax Act.”

This may give the Province more than they funded. We have capital assets which were purchased with Federal, foundation and other monies. I suggest the Board consider including the option to distribute the assets not claimed by the Province to other charitable organizations which provide service consistent with their wishes.

If this is not possible, or if the Province insists on sale of assets, I recommend that the system as a whole be offered for sale in order to minimize dissolution time and costs. It is also likely that a configured, working system is more valuable than one in pieces. Once sold, the proceeds of the assets be returned to the claiming funders in proportions equal to their contributions to the organization during the past three years.”

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About mielniczuk

Community, systems, design, collaboration, change, evidence, Intelligent Accountability(c)
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