Treasurer's Manual

A Manual

For

The New Treasurer

 

 

From the Division of Cemeteries
One Commerce Plaza
99 Washington Ave.
Albany, NY 12231-0001

 

Dedication
This manual is dedicated to Michael Itzo, our former Assistant Director who lost a brave battle against cancer in 2000. Mr. Itzo was employed by the Division of Cemeteries for twenty five years and will be fondly remembered for his dedicated service to the Cemetery Division and cemeterians across New York State.

Congratulations, by accepting the position of treasurer you are providing a vital service to your community, cemetery lot owners and their families. This Manual will provide you with a basic outline of the rules, regulations and responsibilities for your new position as treasurer.

This manual is divided into three sections:

I ) Bookkeeping system and reporting requirements

II ) Principal rules and regulations

III ) General advice

Disclaimer: This Manual provides the basic rules and responsibilities for the new treasurer. It is intended as a guide and is not an all inclusive Manual. To obtain further information please visit our web site at www.dos.ny.gov. A copy of the cemetery law Manual which can be downloaded free of charge, will provide a more complete set of rules and regulations.

I. Bookkeeping System

A bookkeeping system should organize and record into accounts all financial transactions in a fiscal year. At the end of this report is a sample ledger for your convenience. A computer is not necessary (but preferable), as multi column ledger books can be purchased at any office supply store. You will notice that the headings (columns) correspond to the entries on the annual report. Each cemetery can customize its ledger to accommodate its particular needs. When devising a bookkeeping system try the following tips:

  • Keep the system simple. Record the transactions you need to record in the period they occurred and in their proper account (see sample ledger). Too much detail can be just as disadvantageous as not enough.
  • Try to run all transactions (receipts & disbursements) through your checkbook. The trail created will make reconciliation of accounts easier at year end.
  • Try to enter transactions as soon as possible while they are still fresh in your mind. Delaying entry will force you to play "catch up," increasing the possibility of errors or omissions.

Receipts

  • Try to deposit receipts from lot sales, burials, etc as soon as possible into your checkbook. Delaying deposits can result in misplaced cash or checks.
  • Deposit tickets should be detailed, listing the amount and brief description of each item being deposited. For example, you may deposit $1,200 into your operating account on a particular date. However, this deposit may be composed of: $400 lot sale, $350 burial and $450 donation.

EXAMPLE CEMETERY
Income ( Receipts)

Transaction Date Lot
Sale
Interment
Income
Foundations Dividends & Donations
Interest
Other

P. Smith 2 lots 05/10/03 $400.00        
Jones burial 05/10/03   $350.00      
J. Rogers Gift 05/10/03         $450.00
CD # 100-200-035 06/21/03       $32.58  

Disbursements

In this section you should attempt to match income with the expenses that generated it.

  • Keep receipts and invoices from disbursements to provide documentation for expenses by the year in which they were incurred. Some cemeteries use a voucher system which provides the details of the transaction, with the corresponding receipt attached to the back. A voucher can also include a space for the initials of one or more officers to show that the payment has been properly authorized.
  • Although there isn’t a formal entry for grave opening expenses, an entry should be made in the additional spaces provided. This will help the treasurer determine whether the margin between the price being charged for the service and what it costs to provide this service is high enough. If the margin is too low, the cemetery is losing out on additional income. There have been cases where the cemetery is charging the same amount for a grave opening as they are receiving in fees. Remember, you have to pay the $5 vandalism fee and transfer $35 per burial to the permanent maintenance fund from this receipt.
  • Transfers from lot sales and burial income are entered in this section. It is important that these transfers be made to insure the building up of trust funds for the future care and maintenance of the cemetery.

EXAMPLE CEMETERY
Expenses ( Disbursements)

Transaction Date Wages
Grave Opening Officers Salaries Supplies/ Repairs Insurance Other

Mowing 06/15/03 125          
Burial 06/21/03   225        
Gasoline 07/01/03       25    
Mower repair 07/15/03       125    
Fidelity bond 08/01/03         100  
Stamps 08/05/03           5.25

Asset Statements

Keep separate folders for bank and brokerage statements (preferably a ringed binder), by fiscal year and account (general, permanent maintenance, etc).

It’s a good idea to identify accounts by their names on the actual statement. For example: if you have your permanent maintenance account at a bank or brokerage firm, have the name of your cemetery and account type (permanent maintenance, general, special trust) printed right at the top of the statement. For example:

Bank of America

Example Cemetery
Permanent Maintenance Trust
Account # 118-01235-12369

Note: When listing assets on your annual report, remember the following requirements:

  • List the assets by type, (checking, savings, mutual funds, etc.), account number and balance as of the end of your fiscal year.
  • For securities (stocks, bonds, mutual funds), list assets at their cost basis and market values (For an explanation of cost basis refer to page seven of this manual).
  • For certificates of deposit, be sure to include the current interest rate and maturity date.

Filing your Annual Report

Section 1508 Cemetery Law Manual: Each cemetery corporation shall, on or before the fifteenth day of March after the end of its calendar year, or if on a fiscal year the seventy-fifth day after the close of such year, file with the cemetery board (1) a statement as to the condition of the permanent maintenance trust fund and a schedule of the assets of such fund. (2) a statement as to the condition of the perpetual care fund and a schedule of the assets of such fund. (3) a statement as to the condition of the moneys and properties received by the cemetery corporation in trust under the provisions of subdivisions (f) and (g) of section fifteen hundred seven of this article. (4) a statement of the gross proceeds of the sale of plots, lots and parts thereof, graves, niches and crypts showing the disposition of such proceeds and (5) a statement of changes in the number and amount of certificates of indebtedness in accordance with the provisions of paragraph three of subdivision (a) of section fifteen hundred eleven of this article. (6) a statement as to the condition of the monument maintenance fund, if any, and a schedule of the assets of such fund.

OPERATING STATEMENT
Receipts & Disbursements

Accurate and timely filing of your annual report is a critical component of your responsibilities as treasurer. Some smaller cemeteries may feel that their activity is so low (few lot sales or burials), and assets so minimal, that they do not need to file this document. All New York State cemeteries that are regulated by New York State Division of Cemeteries must file an annual report. If you are having difficulty completing this report, please call the Division of Cemeteries senior accountant who has responsibility for your cemetery for assistance. A list of Division accountants is provided at the end of this report. Another option is to have a local bookkeeping or accounting firm compile the report for you. Fees for these services are usually reasonable, and are offered in most cities and towns.

For the most part, entries on the annual report are self explanatory; however from reviewing annual reports in the past, there are certain areas that may need further clarification.

RECEIPTS:

Operating Account Balance-Beginning. This entry should represent your checking account, or any other account that receives operating income and disburses expenses . As mentioned above, you should run all transactions through this account to provide a clear trail of receipts and disbursements and to make reconciliation of accounts at year end less difficult.

Dividends and Interest: This entry is the amount of interest earned in the current fiscal year and transferred to the operating account (namely checking). If interest is earned in a trust account, permanent maintenance and or perpetual care, but not transferred to the general fund it is not entered here. Total interest and dividend income that is earned from all accounts is entered at the bottom of the annual report, entry number eight. This entry is frequently missing on annual reports, but is a critical piece of information for assessing income.

Transfer from trust funds

This is income earned in a trust fund, permanent maintenance, or perpetual care, that was earned in previous years. This is not the income that the trust earned in the current year. This income is surplus interest and or additions above the statutory requirements and can be expended if needed by the cemetery for maintenance. Remember, the restricted principal cannot be transferred to the operating account without petition and approval by the Supreme Court in the county where the cemetery is located. To determine how much of your permanent maintenance trust is surplus, see section titled restricted balance on page eight. Adjustments may be required to update balances for audit reports that are not current.

Cemetery Assets

Cemetery assets can be divided into four general categories. A brief explanation of the nature of each account and bookkeeping requirements are as follows:

A) General Fund or Operating account.
B) Permanent Maintenance trust
C) Perpetual Care trust
D) Special Trust

A) General Fund

The General fund is your "day to day" operating account. This is the account from which you pay your bills and deposit receipts from operating activities. This should represent your checkbook or any other financial account that is not restricted or dedicated to the permanent maintenance, perpetual care or special trust.

B) Permanent Maintenance

"A cemeteries permanent maintenance account is its financial commitment to its future care. Over time, these funds must grow to meet the maintenance needs of the sold out cemetery. It is essential to collect enough money as sales are made and to invest the funds wisely, so the purchasing power will grow and keep pace with increases in maintenance expenses."

Reprinted from: A Cemetery should be forever, by John F. Llewellyn, page 269

 

This permanent maintenance account can be compared to an individuals retirement fund. As an individual invests part of his/her income for the day when he/she will no longer be working, receipts from lot sales and burials are deposited into the permanent maintenance trust for the day when it no longer receives operating income. (Rules for deposit requirements below.) When there are no lots left for sale and no more burials can be performed, the income from this trust must maintain the cemetery essentially forever. The importance of prudently managing this trust cannot be stressed enough. Making the required deposits and conservatively investing trust funds is vital to the future survival of the cemetery. The adequacy of the permanent maintenance account should be tested periodically to see if the balance is sufficient and on track. A good rule of thumb is to calculate the percentage of cemetery property already sold. Then take a risk free rate of interest, (for example the rate on a three month treasury bill or one year certificate of deposit) and multiply this by your total permanent maintenance assets. This amount should cover maintenance cost in the same percentage of land sold. For example: if your yearly maintenance cost are $7,500.00 and you have $75,000.00 in your permanent maintenance trust (assuming prevailing interest rates are 3%)

Land:10 acres 5 sold 50% sold

Total maintenance cost $7,500.00 X 50% = $3,750.00

Permanent maintenance $75,000.00 X 3% = $2,250.00

Shortfall in income from Permanent Maintenance $1,500.00

In this example, you would need $125,000.00 ( at a rate of 3% ) in assets to generate $3,750.00 in maintenance income. In this illustration it may be prudent to increase your allocation from lot sales from 10% to 20% or to make additional investments to the permanent maintenance fund when they become available.

Deposit requirements for Permanent Maintenance

For convenience, a savings account can be dedicated for the mandatory deposits. When this account reaches a certain point, it can be reinvested into a certificate of deposit or other financial instrument to obtain a higher return.

LOT SALES

A minimum of 10% of gross lot sales must be deposited to the permanent maintenance trust. The deposits can be made when individual lot sales occur or at year end. If cemetery finances allow, depositing more than the minimum 10% is encouraged. Depositing more than the required 10% will help to ensure the future viability of the cemetery for years to come.

INTERMENTS

As of 01/01/01, $35 per interment (and cremated remains) must be deposited into the permanent maintenance account. This can be done at the time of burial or at year end. If you do not have formal charges, the fee can sometimes be collected by the funeral home performing the burial, or can be collected from the consumer. As with other service charges, this Administrative fee must first be submitted to the Division of Cemeteries for approval.

Permanent maintenance income and principal.

Interest or dividends can be transferred to checking or other general account asset if needed for expenses. If not immediately needed, interest and or dividends can be reinvested to take advantage of the powerful effects of compounding. The principal or restricted balance cannot be expended (restricted balance explanation on following page) except upon application and approval by the Supreme Court in a district where the cemetery grounds is located. If the court approves of an invasion of permanent maintenance principal, the court will likely order that the amount removed be repaid. The restricted balance can be found on the audit report received from the Cemetery Division’s accountant. If the trust is invested in stocks, bonds or other marketable securities, capital gains must be reinvested and become part of the principal or restricted balance. Stocks, bonds and mutual funds in the permanent maintenance account must be listed on your annual report at cost.

Cost Basis:

The cost basis of a security is the original purchase price, increased by additional purchases or reinvested dividends. For example:

Transaction date Cost # shares Average cost / share
Original purchase 2/98
$2,500.
100
$25
Additional Purchase 6/98
$675
25
$27
Reinvested dividend 12/98
$350
10
$35
Total
$3,525
135
$26.11

This method uses the most common way to determine the cost basis for mutual funds, called weighted average. Two other methods are specific identification and FIFO ( First in -First Out ). These two methods require additional bookkeeping requirements and may not afford any additional benefits to the cemetery.

Market Value

The Market value for these shares may be more or less than their cost basis. The market price is the dollar amount the security will bring if sold on the open market on a particular day. Many brokerage firms report both cost and market value on the statements they mail you. If your Bank or brokerage firm does not present securities at cost, you can request that on future statements the cost basis be included to comply with reporting requirements. Comparing cost to market value will give you an idea of how your investments are faring. It answers the question, " How much do I have invested and how much is the security worth today?"

RESTRICTED BALANCE

What exactly is the restricted balance or restricted liability? How does this figure compare to the amount listed under assets on the audit report? Attached are examples of two cemeteries. Example 1 has savings and certificates of deposit while example 2 has securities ( stocks, bonds and mutual funds ).

EXAMPLE 1 (Savings)

In example 1 (page 17), the restricted balance is arrow A, in this case $51,510.00. Your assets total $62,600.00 leaving you with a surplus of $11,090.00. This surplus may have been achieved by leaving interest to accumulate or by additions over and above the statutory requirements. This amount may be expended for general maintenance or other purposes; however it is strongly advised to allow the surplus to compound for future maintenance needs.

EXAMPLE 2 (Securities)

In example 2 (page 18), the cemetery has an investment account with stocks, bonds and mutual funds. The restricted balance is once again arrow A $52,085.00, assets total $55,100.00. Realized capital gains are added and capital losses are subtracted. Does this mean you have a surplus of $3,015.00? Not necessarily. When securities are a portion of the permanent maintenance account, the distinction between restricted balance and asset total is somewhat complicated. Note that the asset balance is listed at cost; this is the actual amount you have invested in the account. However, the market value, or the amount you would be able to sell your securities for at the time of the audit is only $48,900.00. In this case you do not have a surplus. Try to error on the side of conservatism when investing funds in the securities markets.

Note: If your are unsure whether you have a surplus or deficit, contact your Division’s accountant.

 

Example:

PERMANENT MAINTENANCE ACCOUNT

PERMANENT MAINTENANCE PRINCIPAL PERMANENT MAINTENANCE PRINCIPAL
Balance at Beginning of year _______________ Balance at beginning of Year ________
PLUS Allocations from lot sales ________________ PLUS Dividends & Interest received ________
PLUS Allocations from Interment Income ________________        Subtotal ________
PLUS Other (specify) ________________ LESS Dividends and Interest transferred ________
_________________ ________________
PLUS profit on sales of securities ________________
       Subtotal ________________
LESS Losses on sales of securities _________________
BALANCE AT YEAR END _________________ BALANCE AT YEAR ________

PRINCIPAL (Permanent Maintenance)

If the cemeteries records have been properly maintained over the years, the permanent maintenance fund principal "balance at beginning of year" should equal the total of the original balance plus:

  • All allocations from lot sales ever made
  • All allocations from interments. (Since 01/01/01, $35/ burial)
  • Voluntary additional transfers
  • Plus all realized capital gains from securities ever sold
  • Minus all realized capital losses from securities ever sold

Lets take a look at the line by line items on the left hand portion (principal) of the permanent maintenance section.

Allocations from lot sales......... This is the amount of gross lot sales multiplied by your allocation rate (minimum 10%) that you transfer to the permanent maintenance trust. While the minimum is 10%, increasing this rate will help to ensure the future viability of your cemetery.

Allocations from interment income.......... Starting 01/01/01, $35 per burial must be allocated to the permanent maintenance fund. These funds can be deposited as burials occur or at year end.

Principal permanent maintenance continued

Other........... These can be voluntary additions that the trustees decide will be dedicated to the permanent maintenance account. Also donations or bequests in which the donor specifies the funds must go to the permanent maintenance trust.

Profit/loss on sales of securities.......... These are the realized gains/losses from the sale of securities in the permanent maintenance account. Realized gains/losses are derived from securities that you have sold in the fiscal year of the report (Unrealized gains/losses is the increase or decrease in security values that the cemetery still holds). This is why it is important to keep accurate records on the price paid for stocks and mutual funds, from which you can then determine the gain or loss you received on the subsequent sale. Capital gains are added to the principal or restricted balance and losses are deducted. If you have an investment account, be sure to tell your adviser of this requirement and that your statements must include the cost basis as well as the market value of securities held.

INCOME (Permanent Maintenance)

Balance at Beginning of year.......... This number should represent the total of all dividend and interest income ever received by the permanent maintenance trust MINUS the total of all permanent maintenance dividend and interest income ever transferred to the general fund............

PLUS Dividends and Interest received................. This represents the dividends and interest earned in the current fiscal year of all permanent maintenance trust accounts (Capital gains or losses are not included in this total).

LESS Dividends and interest transferred....................... This represents the dividends and interest transferred, whether they were earned in the current year or are part of past accumulations.

As stated before, invasion of permanent maintenance trust principal is not permitted without petition and approval of the Supreme Court where the cemetery grounds is located. If by some circumstance or hardship, you need to make a loan from the permanent maintenance trust, you must complete the following steps:

GUIDELINES FOR A PERMANENT MAINTENANCE LOAN

Loans from the permanent maintenance fund are covered under Section 1507(a) of the Not-for-Profit Corporation Law. An application for such a loan is made to the Supreme Court in the district where a portion of the cemetery grounds is located. Said petition should contain a repayment clause. The New York State Cemetery Board must given notice of this application

The attorney should arrange a Supreme Court date thirty (30) days in advance. This will allow ample time for review by the Cemetery Board and the Attorney General’s office. It is important that a court date be included.

Two copies of the petition should be forwarded to the New York State Department of State, Division of Cemeteries, 41 State Street, Albany, New York 12231. DO NOT SEND ORIGINALS.

A Division representative will review the legal papers and make a recommendation to the New York State Cemetery Board. The Cemetery Board will then make its final recommendation. The paperwork is forwarded to the Office of the Attorney General for his review and answer to the application.

C) Perpetual Care

The term "perpetual care" has a very specific meaning in New York State. Perpetual care is essentially composed of many small individual endowments purchased by individual lot owners to provide income for the care of their own plots. As cemeteries grew, the bookkeeping requirements for numerous accounts became cumbersome and the permanent maintenance account was established. Some cemeteries still have perpetual care accounts, and these must be maintained (interest can be expended but not the principal or restricted balance), but no additions are being made. If you are unsure as to what the proper restricted balance of your perpetual care trust is, consult your Division’s accountant (A list of Division accountants and telephone numbers is provided at the end of this manual).

D) Special Trust

Our final category, special trust, is just that-trust accounts that are designated for a specific purpose. For instance, families that have personal mausoleums set up trust for the maintenance of the mausoleum. Also, a family may require that flowers be placed upon the plot of a loved one every year and set up a trust to pay for these flowers. There are a variety of circumstances where individuals set up a special trust, but the rules are essentially the same. Unless otherwise specified in a will or other legal device, the principal must remain inviolate and the income used for whatever purpose the trust designates.

Note: When cemeteries receive a bequest, it is important to retain, at a minimum, the following documents: A copy of the disbursement check, will, and any other correspondence from attorneys related to the transaction. Some bequests are restricted for a particular purpose. This purpose will usually be stated in the will. Some bequests are for the general care and maintenance of the cemetery; these are unrestricted.

II. PRINCIPAL RULES & REGULATIONS

Note: The numbers i.e. 1507, 1508, refer to sections of the cemetery law manual. A copy can be obtained free of charge from the Department of State’s home page at www.dos.ny.gov .

(sec 200.5) Fidelity bonding

(a) Every cemetery corporation with combined funds (cash and investments) of $40,000 or more shall carry fidelity bond coverage for officers and employees who handle money and securities.

(b) The annual financial report filed with the Division of Cemeteries shall indicate the amount of fidelity bond coverage, the classes of employees included, name of carrier and policy number, and the expiration date of coverage.

(c) Cemeteries with combined funds and assets of less than $40,000 may apply to the Division of Cemeteries for an exemption from meeting the requirements of subdivisions (a) and (b) of this section. The Division shall grant the exemption upon receiving satisfactory documentation demonstrating that all financial transactions, including withdrawal from trust funds or general funds, require the signatures of two or more designated cemetery officials.

(d) If any cemetery which is currently exempt should, at any time in the future, obtain combined funds and assets in excess of $40,000, that cemetery shall, within 60 days of notification from the Division of Cemeteries, obtain the bond required by subdivisions (a) and (b) of this section.

1507(h) Vandalism and abandonment

Under this law, $5 per burial (less cremations from New York State crematories) is required to be sent to the Division of Cemeteries at year end. The Division will send you the form titled " Notice of assessment and vandalism, # DOS-532." It is important to submit this form even if your cemetery had no burials for the current fiscal year. The monies contributed are used to defray the cost of repairs to monuments that have been damaged due to vandalism. This fund has since been amended to include the restoration of monuments that have become a hazard to the cemetery for various reasons. There are requirements that must be met before funds will be released; however, the process is a simple one. If you have any questions concerning this application, call the Division of Cemeteries at 518-474-6226.

1508(c) Assessment fee

Cemeteries must remit $3 per burial (less NY state cremations) for burials in excess of fifteen for the most recent fiscal year.
Crematories must remit $3 per cremation, for cremations in excess of fifteen for the most recent fiscal year.

1509(b) Service charge approval

Cemeteries are required to submit to the Cemetery Board all requests for service charge increases. These charges include interment, foundation, annual care and perpetual care, extra charges for weekend & holiday burials, etc (Lot prices do not require approval of the board, but do require notification that they were increased). This request can be submitted on an informal basis by sending a letter to the Division of Cemeteries with the current and proposed increases, and a brief description of the reason for the increases (for example: increased materials or labor charges...).

Note: The rules presented above represent a portion of principal regulations that the new treasurer needs to be aware of. For a more complete list, please consult the Cemetery Law Manual.

III. GENERAL ADVICE

MAINTENANCE COST

Keeping a watchful eye on operating costs is an important component of a treasurer’s responsibilities. Many cemeteries are opting to "contract out" maintenance services. When weighing this option try to match the cost of replacing and or maintaining equipment, payroll taxes and insurance cost (along with the requisite bookkeeping responsibilities) against one fixed price to an outside vendor. It is a good idea to get a few quotes and a written contract explaining in detail the deliverables, or what you can expect in the way of services for the contract price. A good time to consider this option is when your equipment is in need of repair or replacement.

Note: Although you will not be providing workers’ compensation insurance to the Independent Contractor, it is good policy to see that they are personally covered for accidents or injury.

PRICING:

Lot Prices- Lot prices should be reviewed periodically to determine if a price increase is in order. Cemetery lots represent your inventory. Unlike other inventory items cannot be restocked when your running low (Unless of course you are able to purchase contiguous cemetery property). Michael Itzo, our former Assistant Director, printed an article on this subject in our first Cemetery Bulletin, July 1998. In this article he gives an example of selling a single lot for $300. Allocating the minimum10% to the permanent maintenance trust yields $30. Using prevailing interest rates of 3% will give you roughly 90 cents to maintain this plot on a yearly basis. At today’s labor rates, this income will be inadequate. When considering selling prices for lots, the treasurer should take a long-term perspective. Also, if the cemetery can afford to make more than the required 10% allocation to the permanent maintenance trust it should by all means do so.

Service charges-Service charges such as burial fees, foundations, perpetual care, or extra charges for weekend interments, need to be properly priced to maximize a cemetery’s finances. When proposing prices, you must first consider what it cost to provide this service. Also, for interment fees, you need to consider the $5 vandalism fee that is sent to the Division of Cemeteries and the $35 per burial that must be deposited into the permanent maintenance account. For example:

Interment expenses:
Grave opening $200
Vandalism fee      $5
PM allocation     $35
Total                 $240

In this example you need $240 just to break even. A good rule of thumb would be to double your grave opening expenses to arrive at a final price. In this example you would charge $400 for an interment. This is just a ballpark figure and every cemetery must evaluate its own situation to arrive at a final price for its services.

FUND RAISING:

Many cemeteries disregard what can be an important source of revenues for a non-profit entity. The question is often asked, "Can a cemetery solicit donations from their community ?" Not only can you raise money from donations, but for many cemeteries with limited assets, fund-raising should be performed on a regular basis. There are many ways to solicit donations, here are a few ideas:

  • Mail letters to the families of lot owners or for that matter, the entire community in which the cemetery is located. A mailing list can be obtained from the local post office or county clerk’s office.
  • Hold a public lunch or dinner with the proceeds going to the cemetery. Many times in the spirit of community involvement, people will donate food and time to support your cause.

Ideas for fund-raising are only limited by your imagination.

Note: Certain types of fund-raising events may require the non-profit to pay taxes. It is a good idea to check with your accountant to determine if your planned event will trigger tax consequences for your cemetery.

INVESTMENTS

While it is not under the purview of the Division of Cemeteries to give investment advice, a few general guidelines can be offered.

Be conservative: To be an effective steward of cemetery funds, let the concept of conservatism be your guide. You are looking for income with a moderate amount of growth. If you invest in securities, let your investment adviser know that the protection of principal is of utmost importance. Keep risk moderate by investing in high quality, well known stocks and bonds.

Keep an eye on cost: Unlike financial goals for individuals which may range from one to thirty years, a cemetery’s investment horizon is forever. Understanding this concept will alert you to the price you pay for management, transaction and mutual fund load fees, which can only erode future asset balances. Index funds make excellent investment vehicles for cemeteries. They combine diversification across a broad range of securities with extremely low cost.

Keep it simple: Many times trustees will diversify by owning many mutual funds and individual securities. While diversification is a good concept, the trust ends up owning too many funds that "overlap" in the securities they own. For example, many large mutual funds own top Blue Chip securities like Microsoft, IBM and GE with the resulting effect that you own these securities not only as individual stocks but in the majority of your mutual funds. This only creates additional cost and provides little or no benefit. As mentioned above, if you purchase Index funds such as the S&P 500 or Wilshire 5000 you literally "own the market" at a very low price. Another benefit is that unlike individual mutual funds, Index funds have very low turnover (buying and selling of securities) and are basically a buy and hold strategy that over time, seems to work best for long-term investment horizons.

SUMMARY

While the business model for a cemetery may seem simple on the surface, there are many hidden complexities that need to be addressed. Those who are entrusted with cemetery funds have a unique and interesting challenge before them. With proper management, and long-term planning, your cemetery will remain a valuable asset to your community for years to come.

EXAMPLE CEMETERY 1
ANY COUNTY; #00-000

YEAR
LOT SALES
P/M ALLOC
10 %
INTERMENT
ALLOCATION
OTHER
ADDITIONS
P/M BALANCE
12/31/98
$50,000.00
12/31/99
$1,500.00
$150.00
$0.00
$0.00
$50,150.00
12/31/00
$2,000.00
$200.00
$0.00
$0.00
$50,350.00
12/31/01
$1,200.00
$120.00
$210.00
$0.00
$50,680.00
12/31/02
$5,500.00
$550.00
$280.00
$0.00
$51,510.00

TOTAL
$10,200.00
$1020.00
$490.00
$0.00
A       $51,510.00

ASSETS

PERMANENT MAINTENANCE

Bank of Ambrose SV # 5465-8909 1%
$2,600.00
Bank of Ambrose CD # 5678-09780 2.20%  04/01/05
$60,000.00
TOTAL   B
$62,600.00
GENERAL
Bank of America CK # 1209-0989  
$2,360.00
Bank of America SAV # 1209-8990 1%
$6,200.00
TOTAL    
$8,560.00
 
TOTAL ASSETS
$71,160.00

PRICES
$350/ 1GRAVE
$350/ ADULT INTERMENT
$150/ CREMATED REMAINS

5 ACRES (3 SOLD)
# INTERMENTS 2002 - 8

RESTRICTED BALANCE

Letter A is the restricted balance or restricted liability. This principal cannot be expended without a Supreme Court Order.

PERMANENT MAINTENANCE BALANCE

Letter B is the total amount of assets in the Permanent Maintenance Account. (Listed at cost.)

To determine what portion of this amount can be expended on operating or other expenditures, simply subtract the amount in B from the balance in A. This is the surplus available to the cemetery.

EXAMPLE CEMETERY 2
ANY COUNTY; #00-000

YEAR
LOT SALES
P/M ALLOC
10 %
INTERMENT
ALLOCATION
CAPITAL
GAINS/LOSSES
P/M BALANCE
12/31/98
$50,000.00
12/31/99
$1,500.00
$150.00
$0.00
$0.00
$50,150.00
12/31/00
$2,000.00
$200.00
$0.00
$0.00
$50,350.00
12/31/01
$1,200.00
$120.00
$210.00
$1,200.00
$51,880.00
12/31/02
$5,500.00
$550.00
$280.00
-$625.00
$52,085.00
TOTAL
$10,200.00
$1,020.00
$490.00
$575.00
      $52,085.00


ASSETS

PERMANENT MAINTENANCE

 
Investment Account
Cost
Market
Ambrose Trust Company #23-009-908
B        $55,100.00
$48,900.00

 

GENERAL

Bank of America CK # 1209-0989
$2,360.00
Bank of America SAV # 1209-8990
$6,200.00
TOTAL  
$8,560.00


PRICES
$350/ 1GRAVE
$350/ ADULT INTERMENT
$150/ CREMATED REMAINS

5 ACRES (3 SOLD)
# INTERMENTS 2002 - 8


Division of Cemetery
Offices

NYS Department of State
Division of Cemeteries
123 William Street 19th fl
New York, NY 10038-3804
212-417-5713

NYS Department of State
Division of Cemeteries
One Commerce Plaza, 99 Washington Ave.
Albany N.Y. 12231
518-474-6226

NYS Department of State
Division of Cemeteries
State Office Building 5th fl
333.E. Washington Street
Syracuse N.Y. 13202-1428
315-428-4262

NYS Department of State
Division of Cemeteries
State Office Building
65 Court Street
Buffalo, NY 13901-4455
716-847-7119

NYS Department of State
Division of Cemeteries
State Office Building 7th Fl
207 Genesee Street
Utica, NY 13501-2812
315-793-2567