HCOPL: Income Flows and Pools Principles of Money Management

HUBBARD COMMUNICATIONS OFFICE
Saint Hill Manor, East Grinstead, Sussex
HCO POLICY LETTER OF 9 MARCH  1972R
Issue I
REVISED 4 August 1983

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Finance Series11RA

INCOME FLOWS AND POOLS
PRINCIPLES OF MONEY MANAGEMENT

(This PL corrects any earlier PL where there is any difference or conflict.)

[…]

DEFINITIONS

Lack of precise definition  as to  what is income  and  what is  “reserves”  has caused trouble  in  identifying  activities and in this flow  line of management and income.

The main trouble it has caused is that a management unit, not having precise definitions and not knowing the flow  lines  (as above),  reaches out to the  wrong “finance pools”  for their support.
(Examples:  A  Continental  CLO  tried  to  live  on  management  10  percents which were  not theirs  [UKLO  ’71].  A CLO let the  nearby AOSH go down  and tried to live off Flag  [USLO  ’71].  A CLO let the nearby AOSH go down,  ignoring it completely while building up only  its  most distant org  [USLO  ’71].  A Div III would not collect actively  on huge debts  because  it could  borrow from  reserves  [Flag Admin Order ’71].  An  OTL  ignored  its  nearby  CENTRAL  ORG  and  kept  trying  to  get  its support  from  its  CLO  [ANZO  ’71].  The  earliest  example  was  a  navy  admiral [Scoles]  running the LA Foundation into the ground in  1950 because he thought it should be supported by Elizabeth, New Jersey.) The WHY of all these was lack of understanding  of flow  lines,  and  lack of definition  of income,  expenses  and reserves as different,  precise money pools and different types of orgs.

Hubbard, L. R. (9 March 1972). Financial Planning Tips The Management Series (1983 ed., Vol. 2, pp. 520-523). Los Angeles: Bridge Publications, Inc.