THE IMPORTANCE OF AMC ACCREDITATION
By Jaime Nolan, CAE
President of IntrinXec Management, Inc.

• Client Contracts

• Servicing Clients

• Service Evaluation

• Financial Controls

• Insurance Requirements

• Employee Recruitment and Selection

• Employee Evaluation and Training

• Subcontracting Requirements

• Record Keeping Requirements

AMC Insitute  is recognized by the American National Standards Institute (ANSI) as the developer of the AMC Standard.

With more than 500 AMCs worldwide, the AMC/ANSI Standard serves as the basis for the AMC Accreditation Program. The purpose of this article is to provide an overview of the Program and its related importance to AMCs and prospective clients.

Client Contracts (Section 3.0)
Section 3.0 of the AMC Accreditation program requires AMCs to have written contractual agreements with all clients whenever feasible, including written commitments that ensure high quality service and service delivery. This section also requires a documented system for periodic reviews of the contract, contract amendments and procedures for transition of a client's property. The importance of this section is to demonstrate to clients that the AMC is organized, professional and committed to high quality service.

Servicing Clients (Section 4.0)
When establishing Servicing Clients practices (Section 4.0), AMCI did not intend to identify the specific ways in which clients were to be serviced. Rather, the Institute sought to ensure there was clear communication between the AMC and its client regarding the expectations of both organizations and a method by which to evaluate those services. This section requires AMCs to establish service policies and delivery systems that include the quantity and scope of services to be performed, background information on AMC staff servicing the client, delivery speed, accuracy and flexibility, as well as methods to measure the services provided and improve performance (if necessary). This ensures that AMCs have measurable performance requirements in place; achieved through process, controls and systems.

Service Evaluation (Section 5.0)
Section 5.0 of the Accreditation program elaborates further on Section 4.0. It requires AMCs to demonstrate that they have written procedures and policies in place to evaluate performance, measure client satisfaction and make necessary adjustments. This section is important to prospective clients because it promotes a level of communication between the client and the AMC that will help develop a strong partnership and an understanding of the responsibilities of both the volunteer leadership and the AMC.

Financial Controls (Section 6.0)
There are two purposes of Section 6.0 as it relates to financial management and internal controls within AMCs. The first is to verify that AMCs have a strong "checks and balances" procedure in place to ensure that client money is properly handled. The second is to ensure that the AMC is in compliance with accounting rules and regulations as promulgated by the Financial Accounting Standards Board (FASB). This includes policies to prevent co-mingling of client funds and policies regarding the confidentially of all client records, data, proceedings, contracts and other information. This section is important to a prospective client as it requires all AMCs to provide a written confidentiality policy to all clients and to demonstrate that its financial controls are in compliance with FASB.

Insurance (Section 7.0)
Section 7.0 of the AMC accreditation program requires all AMCs to have minimum insurance coverages in place to adequately protect both the AMC and the client. Insurance requirements include general commercial liability, property (including property in transit), valuable papers, employee dishonesty, monies and securities, computer equipment and data, auto liability, work comp, errors and omissions, and professional liability insurance. AMCs should make sure that their clients are also covered with their own policies. AMCs going through the accreditation program often assume their business office insurance package (BOP) includes coverage for their clients' records and materials. In today's world it is extremely important that both parties carry appropriate coverages.

Employee Recruitment and Selection (Section 8.0)
The importance of having written and documented procedures regarding employee recruitment and selection lies in the fact that the AMC has pre-determined expectations of its various staff positions and each job requirement. By having written job descriptions, candidates are fully aware of the expectations of the open position, and the requirements necessary to fill the position. This provides clear communication between the AMC and its staff, as well as an efficient interview process of candidates for the open position. These job descriptions are also important to clients, as they are able to know exactly what the AMC expects from its staff when servicing them. The purpose of Sections 8 and 9 is to assure the AMC's employees know, understand and comply with company procedures and systems.

Employee Evaluation and Training (Section 9.0)
Section 9 of the AMC Accreditation program requires AMCs to have written policies and procedures for employee performance reviews. This section also requires AMCs to have written policies regarding periodic training in areas such as process monitoring and control; data collection and analysis; performance improvement and corrective action; teamwork, interaction and communications. This will ensure that the AMC has established and implemented a training program for its employees to ensure that the delivery of services meets the level set by the AMC. By having these policies in place, AMCs are demonstrating to their clients that they have a strong commitment to ongoing employee training and education – ensuring that their staff is always up-to-date on the latest trends and issues relating to nonprofit associations.

Subcontracting and Purchasing Requirements (Section 10.0)
To promote ethical practices in the AMC industry, AMC Institute included this section in the accreditation program to make clear to prospective clients as well as AMCs, that the utmost integrity is expected when subcontracting and purchasing on behalf of a client. In doing so, all AMCs are expected to exercise due diligence in purchasing products or services on behalf of their clients. This includes written procedures for hiring subcontractors, completing purchase orders, and disclosing any finder's fees or commission received by the AMC for services contracted by specific vendors. (Information regarding commission disclosure is more specifically addressed in section seven). Full disclosure contributes to maintaining positive client relationships.

Record Keeping Requirements (Section 11.0)
In recent years, national headlines involving "Enron" and "Arthur Anderson" have drawn attention to corporate scandals. Prior to all this, section 11 of the AMC Accreditation Program had established a requirement for accredited AMCs to have written and documented procedures relating to the storing, archiving and destroying of client documents. This requires AMCs to adopt a records retention policy and a policy regarding the safeguarding of records protecting them from damage or deterioration and/or unauthorized access. With the conception of the Sarbanes-Oxley Act and other recent issues of security, this section is very important to both the AMC and their clients.

Independent Review (Section 12.0)
In order for an AMC to become accredited, they are required to undergo an independent review by a third-party CPA. The Reviewer must not be employed by the AMC and must be experienced in conducting reviews, which includes a successful peer review of their own. The importance of this independent review is for an outside party, someone completely unaffiliated with the AMC, to verify that the AMC actively follows and has policies and procedures in place to support all areas identified in the Accreditation Program. Upon the completion of a successful review, the Reviewer submits a report to AMC indicating that the AMC has documented and implemented all required areas. The AMC Accreditation Committee then reviews the report, either questioning or accepting it.

Earning accreditation through the AMC Institute is an enormous accomplishment and demonstrates an AMC's commitment to consistent, high quality service. It shows that an AMC has developed comprehensive quality control systems, giving assurance to volunteer leaders searching for the right AMC. As the only AMC/ANSI Standard-based program for the industry, being an AMCI-accredited AMC will distinguish your firm from your competitors.

Jaime Nolan, CAE  is President of IntrinXec Management, Inc., a Minneapolis-based association management company. Email jnolan@intrinxec.com or visit www.intrinxec.com.