When to Bill for the Dinner
Many schools have adopted the practice of making it mandatory for households to attend the annual dinner. The question becomes when the dinner charge should appear on the bill. The two choices are either at the beginning of the years or after the dinner.
The main benefit of billing at the beginning of the year is for cash flow purposes. The earlier an item is billed the earlier it is likely to be paid.
A second benefit is that by billing at the beginning, the dinner can be included in the total charges and can be included in the households monthly payment schedule. Including an additional charge after having already arrived at a total charge amount and a schedule can be slightly disruptive.
The downside to billing early is that is decreases the probability that a person will increase their dinner obligation voluntarily, since it is already on the bill, many people will stick with the minimum amount rather than increase their pledge. It usually won’t affect your big donors, but the loss to the average household could add up.