The Montreal Fine Arts Museum

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The Montreal Fine Arts Museum

Simulation 2 (37 marks, 90 minutes)

The Montreal Fine Arts Museum (MFAM) is a non-profit organization that was founded nearly 25 years ago by the Monet brothers, who devoted their entire lives to promoting art. For the past five years, the MFAM has grown nicely due to its Curator’s talent for putting on exhibitions that the public finds very interesting.

As a result of the budget cuts announced by the government this year, grants for the arts were down considerably. The cut is even more significant for private organizations that, like the MFAM, have to raise 65% of their financing requirements through ticket sales in order to be eligible for a grant program.

The Chairman is very happy to announce some excellent news. As of April 1st, the London Museum will lend to MFAM, free of charge and for a period of nine months, its entire dinosaur and prehistoric art collection. This is extremely good news because it will attract the public and generate some much needed cash flow.

It is now February 26 and the Chairman of the Board of Governors, Mr. Monet, has just asked you, CA, the newly hired Controller, for your opinion on various matters concerning the Museum.

There are some concerns about the administration of the MFAM. A fraud was recently discovered involving a purchased painting that was found not to be authentic. This could have a serious impact on the Museum’s reputation and could cause the London Museum to refuse to lend its collection to the MFAM. You meet with a few different people to obtain an understanding of how the museum operates (Exhibit I).

In light of this fraud, Mr. Monet wants you to recommend controls that should be implemented as well as suggesting means for ensuring they are followed. These recommendations will be executed by yourself and Mr. James, a member of the Board of Governors who is also the Controller of a company in the area. The Board of Governors also wants you to raise to their attention any other significant control and operating weaknesses in the management of the Museum.

Furthermore, the MFAM announced publicly that on April 1st it will be launching a new website. The site will allow users to learn more about the permanent collection and current exhibitions as well as allow the public to make donations to the museum online. The Board of Governors has received a proposal from the potential supplier, WebStirs, (Exhibit II) and would like your opinion on it.

Finally, The Board of Governors is aware that the public is still reluctant to use the internet for donations and would like you to recommend measures to be taken to reassure potential donors and encourage them to use this advanced technology.

Exhibit I

Discussions Regarding Museum Operations

Curator, Mr. Picassi:

Mr. Picassi mentioned to you that he’s had some concerns with respect to the Museum’s new buyer, Mr. Vinci, for quite a while. He tells you he recalls a number of conversations with Mr. Vinci concerning the painting from a new “up and coming” artist that he desperately wanted to buy.  

Mr. Vinci said he had lost all the purchase documents for the painting during his last trip to Paris. This was a cause for concern as the painting turned out to be very expensive. In fact, it was the most the Museum had ever paid for work from a new artist. Mr. Picassi also wondered if the painting was genuine since Mr. Vinci had also misplaced the official document proving it was an original. This made the Curator very nervous because the Museum must present proof of authenticity for all new paintings before they are put up for exhibition.