what every treasurer must know teresa williams, national pta secretary-treasurer jeanice aikens,...

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

twilliams@pta.org

Jeanice Aikens

National PTA Chief Financial Officer

jaikens@pta.org