Fiscal responsibility


The mood of Superboss was somber. In grave tones, befitting a memorial service, he announced that the HQ has sent a missive that expenditure is spiraling in our zone, and that the matter had assumed serious proportions. He had, he said, called the meeting all the senior staff to get to the bottom of the problem, and to find remedies for the same. “We have to send an explanation, immediately, along with measures that we will now put in place to check the ‘uncontrolled and unjustified’ spending. And these are not my words.”

There were glum faces and a total silence in the room following this announcement. It was not that anyone was remorseful or felt guilty – none present felt that he was related to, or was the cause of, the present crisis in any manner possible. Finally, it was the finance manager, the bespectacled old Mr Fred, who spoke.

“Our accounts do not show any alarming increase in spending. What with increasing costs…” Mr Fred began, but was snubbed instantly by Supeboss.

“It is not normal to have any increase at a time when the company is undertaking austerity measures. I should have been kept informed of any lapses on financial discipline. Why was all this happening behind my back,” asked Superboss.

That stumped Mr Fred, and rightly so. For one, there was nothing very unusual, by way of spending, that had taken place in the current year. Fred had also kept Superboss informed of every expenditure, not only by getting prior approvals, but also by briefing him at regular intervals. Therefore the charge of working behind his back was something that was not easy to respond to, short of bluntly pointing out that Superboss was lying. This step was probably premature, and a little drastic, and so Fred kept quiet.

His silence was however taken as an admission of guilt. Another round of lecture by Superboss, this time directed against Fred, ensued. This too however failed to resolve the two issues at hand – identifying the problem areas and finding solutions. Having been blamed on totally unjustified grounds, Fred seemed to throw in the towel, and it was evident from his demeanor that he was not likely to offer anything concrete to the discussion. Superboss next fixed his glare at Admin, the ‘big spender’ of the office.

The fact that Admin had not marshaled his facts and was unprepared, made his task of responding to a suspicious glare all the more difficult, and as a safe bet, he decided to mumble. This strategy usually works, but has the unavoidable side-effect of making Superboss froth at the mouth.

Musical chairs continued, but with little solid result, until it was the turn of masterly Mr A, my boss, to speak.

“While it is true that we must have a clear grip over what we are spending and especially at a time when the company is grappling with a minor crisis, a crisis that is not threatening per se, but which is serious nevertheless,” began Mr A in his inimitable style, and clearly had the audience enthralled.

Much later, he came to what we may call ‘the operative part’ – “Therefore we must set up a committee to look comprehensively into all the expenditure that we have incurred. This committee should also identify the solutions and report to Superboss without any further loss of time.”

This satisfied everyone, and the focus shifted to the composition of the committee. Fred and Admin obviously had to be a part of it, but it took some effort on part of Superboss to make Mr A agree to be a part of it. Finally, though it was a committee of equals, Superboss directed Mr A specifically to submit the report to him within a week.

By sheer stroke of luck, I got the opportunity to attend one of the meetings of this committee next week. The assistant who was taking the minutes suddenly fell ill – though some people doubted this excuse and were uncharitable enough to suggest that the cricket match in the city was the likely cause of his absence. Whatever may have been the cause of his nonattendance, the sudden vacuum, so abhorred by the bosses, was sought to be filled by a willing subordinate. I was curious to know what was going on in the committee, and readily agreed to take notes.

Right at the start of the meeting that day, I understood that Mr A was playing the role of a friend, philosopher and judge wile Admin and Fred were doing the heavy duty file work under his watchful patronage.

“Now that we have ruled out the possibility of any changes in salary and perks of managers and staff, and the committed expenditure on maintenance, we move to some purchases that were not routine,” Fred said, head buried deep into his files.

“We bought an expensive golf cart, and related equipment for our club-house. We actually do not use the cart as we don’t have a golf course of our own and as it is only Superboss and Mr X who play golf in our office. Some Gym equipment and the large LCD TV that we have ordered can similarly be looked into – again because our club house is underutilized,” declared Fred.

Mr A smiled and shook his head. “These would be false savings, as these are necessary acquisitions for the image of the company. Imagine how it would look if the CEO came to the city and wanted to invite some other CEO to our club-house, and if they wanted to have a round of golf or something. We must focus on recurring expenditure,” Mr A said. It did sound to me a little far-fetched that the CEO would invite some other CEO in our Zone, but I gave full credit to the foresightedness of Mr A to think of such a possibility. Mind boggles at the thought of us not having a golf cart in the event of CEO wanting to…….

The next item brought up for discussion by Fred was the proposed trip of Superboss to Europe for a Conference on Social Responsibility and Green Initiative. Fred put up a facile argument that the conference is not central to what we do, and that it would not add to our performance, and also that we would save much if we cancelled the trip.

But Mr A would have none of it. “It is not a recurring expenditure,” he began, but I thought that was not entirely true – Superboss’ trips being so frequent. “The trip has the sanction of the HQ and is a part of image building for the company at an international level. We must not be penny wise pound foolish, as the saying goes.”

“I think we can also not reduce the number of parties that we are throwing for the agents in five star hotels,” said Fred, finally getting in tune with the principles that were governing Mr A. “I really do not know where to look to make a saving,” lamented Fred, looking towards Admin for inspiration.

“Don’t ask me,” said Admin, “Besides the maintenance, I deal in petty expenditures.”

“Like?” asked Mr A, interested.

“Like paper cups, like catering for office meetings, like stationary, like transport,” replied Admin, annoyed. It was not clear whether he was miffed at having to deal with small expenditures or was irritated that the meeting was wasting its time on mere trifles.

“Take care of your pennies and the pounds will take care of themselves,” said Mr A. Proverbs and homilies are his strong point. It did sound a little contradictory coming right after penny wise etcetera, but Mr A persisted and Admin went into details of sums spent on a hundred different items of daily use in the office. To my untrained ears, everything sounded in order, but you cannot fool Mr A.

“Aha,” he exclaimed with satisfaction, sounding a little like Hercule Poirot. I remember a line of Poirot in Murder on Orient Express that goes something like this –“Only by interrogating the other passengers could I hope to see the light, but when I began to question them, the light, as Macbeth would have said, thickened.” For Mr A, the light was thickening.

“There has been an abnormal increase in the expenditure on paper for photocopy machine in our office,” Mr A said darkly, finally having got to the root of the malaise.

Admin and Fred were slow to pick up the clue, waffled about the fact that the actual amount spend on stationary was very small, and continued to act dumb like Dr Watson. Mr A had to explain quite in a manner that Sherlock Holmes used to do in his time – “These are tendencies that have a habit of getting out of hand if not curbed at the start. I don’t know about you, but I will write strongly about this in my report.” With iron in his tone, Mr A had made it clear that he would not allow any hanky-panky while he was in charge, and said that his report would call a spade a spade. No quarters would be given, he added, when the matter was of fiscal responsibility. However high or mighty one maybe, they should not expect leniency from Mr A. He said he did not worry about his job – he would remain true to his conscience.

It was a stirring speech, and had a sobering effect on potential dissenters. The report was later prepared and presented by Mr A to Superboss, who immediately took a liking to it. Strict remedial measures, as recommended in the report, were issued to all departments. A system of regularly monitoring the usage of paper in photocopiers was set up. Senior managers were to be held personally responsible for any lapse. The report was forwarded to the HQ that same week.

The report seemed to have satisfied the HQ for we did not hear from them regarding excessive expenditure. It satisfied Superboss, who included portions of it at the Conference on Social Responsibility and Green Initiative at Geneva, and impressed the Europeans. I am told that he got a standing ovation and a number of queries by CEOs of a number of multi-national corporations. And it definitely satisfied Mr A, who said that the most important thing was that he had not compromised with his principles.


About Abhishek

I will let the blog speak for itself...or, at times, for me. View all posts by Abhishek

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