What Every Treasurer Must Know
Teresa Williams, National PTA Secretary-TreasurerJeanice Aikens, National PTA Chief Financial Officer
© National PTA, 2010
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Let’s Talk About
Money Management
Reports and IRS Regulations
Insurance Needs
Fund Raising
Resources
Best Practices
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First Steps!
Make sure books are audited/financial reviewCheck the files!Study duties and any reference to finances/budget in your PTA bylawsSecure signatures of authorized officersFile signature cards with bankCheck on bond and liability insuranceReview PTA Money Matters
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Money Management
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Money Management
Develop a realistic budget– Review Records Retention Schedule
Store records properly — keep:– Copies of all Treasurer’s Reports– Bank Statements and Reconciliations– Check Request or vouchers– Deposit Receipts
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Banking
Two Signatures on all checksUse Large Size Checks Duplicate Check Fees and Monthly Charges– Deposit and Withdrawals
Location and Hours Online Banking AvailabilityMonthly Statements
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Reporting
Make a report at all Board meetings
Develop a report to best reflects a transparent process– Budget Amount– Monthly Report– Year-to-Date Total– Balance of Line Item
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East Anywhere High School
Tip: Use the program and report design that is best for you and your PTA!
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Reports And Regulations
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Reports And Regulations
Follow all State and Federal guidelines
Follow your approved budget, amend if needed
Perform an financial review/audit at year’s end, or when needed
Review relevant areas of www.irs.gov
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Applying For Tax-exempt Status
www.irs.gov
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Resources From National PTA
National PTA
provides
all states and local units
access to resources
that are easy to
understand.
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Tax Code Compliance
A top priority of any
state, council, district,
or local unit is to
stay in compliance
with tax codes.
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Federal Requirements
Federal Tax Exempt Status – 501(c)(3)
Employer Identification Number (EIN)
Determination Letter of Tax Exempt Status
Public Inspection Requirements
Unrelated Business Income (UBI)
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A Correct And Timely Form 990
Who should file?
Which form should be filed?
When to file?
What are gross receipts?
Why is this important?
What happens if we don’t file?
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Audits And Financial Reviews
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Purpose Of The PTA Audit
To certify accuracy of books and records
To assure membership resources are being managed properly
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Three Types Of Audits
Compiled Financial Statements – Limited or no verification of information
Reviewed Financial Statements – Perform some inquiry and analytical procedures
– Limited assurance of information
Audited Financial Statements – Highest level of assurance of information– Extensive substantiation and verification
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Preparation For Financial Review
Financial records should be “put in” orderBills cannot be paid after books are closed for financial reviewMaterials needed include– Copy of last financial review/audit– Checkbook and canceled checks– Bank statements and deposit receipts– Itemized statements and receipts of bills paid– Check requests or vouchers
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The Need For Insurance
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Why Does PTA Need Insurance Coverage?
School districts generally do not cover PTA Units
Protects the assets of the PTA
Protects the assets of PTA members
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Types Of Coverage
General Liability
Fidelity Bond
Directors and Officers Liability
Property
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General Liability Coverage
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General Liability Coverage
Who should be protected?– The PTA unit– Volunteers, PTA members
What protection does general liability provide?– Actions against the PTA from injury or property
damage
Is there a dollar limit?– PTAs are encouraged to investigate a policy containing
a $1 million limit; this is an industry standard
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Coverage
Types of Events Covered– Meetings and Dinners– Book Fairs– Food Sales– Carnivals– After Prom – Graduation Parties
Tips:Tips:• Make sure your insurance carrier
provides a list of all covered activities • Never assume that your PTA is
under someone else’s coverage.
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Events Not Covered
Typically the following events are not coveredFirework SalesMechanical RidesBoatsWatercraft ActivitiesOrganized Sports
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Fidelity Bond Coverage
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Fidelity Bond Coverage
Protects the cash of the PTA unit against– Theft– Robbery– Embezzlement
Who’s Covered?– All individuals who handle funds regularly
• Treasurer• President• Fund Raising Chair
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Considerations
How can your PTA protect itself?– Two signatures on all accounts– Have the checking account reviewed by someone
who is not a signer– Conduct an annual audit/financial review
How much coverage do we need?– Each PTA should determine their own amount of
coverage
Tip:Tip:• Match the amount of coverage to the amount of the budget.
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Officers And Directors Coverage
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Officers And Directors Coverage
How are PTA Officers protected?What situations are covered?How are officers not protected?
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A “Word” About Fund Raising!
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How Many Fund Raisers Should A PTA Hold?
Remember the “3 to 1 Rule”
Base fund raisers on your annual budget and plan your activities
Be knowledgeable of IRS Regulations
Research State regulations governing non-profit fund raising
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Who Needs To Approve Contracts?
Approval of contracts has an effect on your overall PTA Budget and Operations
– The Board should have input – The president should sign all contracts
Do not allow a vendor to push your PTA into a contract
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Tips For A Successful Event
Make sure your percentages are the highest possible
Does the event have a good track record with your PTA?
Make sure your members know where the funds are going to be used
Deposit all funds the day they are received
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Useful Resources
www.pta.org
National PTA e-Newsletters
PTA Money Matters
PTA Convention Handouts
PTA President’s Quick Reference Guide
NPTA e-learning courses– Ethical Leadership– Preventing Theft In Your PTA
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The
2010-2011
Money Matters will
arrive in the
PTABox of Possibilities!
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Another great resource
developed by National
PTA is the…
PTA President’s Quick PTA President’s Quick Reference GuideReference Guide
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Contact Information
Teresa Williams
National PTA Secretary-Treasurer
Jeanice Aikens
National PTA Chief Financial Officer