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Suggestions for
safely managing your chapter’s funds… As IRS requirements continue to increase, banking regulations tighten up, and public scrutiny of organizational dollars becomes the norm, we’d like to take this opportunity to offer some suggestions for more appropriately, securely, and transparently managing your chapter’s funds. Please keep in mind, most of the below are suggestions – they may not work for every campus, and in some places, they may be outright impossible. Please, please, please check with your campus’ business office and discuss with your student leaders and student affairs professionals any changes you plan to make in your chapter’s finances, whether those changes were spurred by these suggestions or not. If possible, keep your chapter’s funds in an on-campus account. Most of our chapters already do this, and we consider it to be extremely important to maintaining good chapter finances. With an on-campus account, you have built-in accountability and reporting, and built-in security (if the account is properly set-up). With an off-campus account, there is a greater chance of fraud, mis-management of funds, and accounting errors. We have received complaints about on-campus accounts from some schools: “It takes so long to get checks issued,” “They require so much additional paperwork,” “We have to have two signatures to get any money issued.” These are all good things – they slow the transfer of money, reduce the likelihood of payment being issued without service rendered, and increase the accountability of the chapter – no one person can make off with chapter monies without an alert being raised. Wherever your account is maintained, consider requiring two signatures for any checks. We all like to think the best of our fellow Alpha Lambda Deltans, but even the best and the brightest have been known to succumb to temptation. Never, ever allow a single person to have full control over chapter funds – and never allow two students to be co-signatories on the account. Make sure your account requires two signatures on any check before it is paid, make sure the checks denote the two-signature requirement (some banks may miss or ignore the electronic notification, a printed notification is extra security), and make sure at least one signatory is a chapter advisor. Make sure to update your signatory list at the end of the school year, before students graduate and disperse. More than one chapter has had funds tied up in an account for months, while last year’s treasurer was studying abroad or otherwise unavailable to the chapter advisors. Keep accurate, up-to-date books. This may be the most important suggestion, and is the one that can be implemented anywhere, regardless of local laws and regulations. You must maintain accurate records of your chapter’s finances. Even if it’s a simple Excel spreadsheet or even a paper ledger, keep track of your chapter’s income and expenditures. At a small chapter, this may be only a handful of entries every year; at larger chapters, this may mean an hour’s work every week on the part of the chapter treasurer. Have your treasurer maintain the books, and a chapter advisor should review them monthly. Balance the books whenever possible – if you have an off-campus account, reconcile the books against your monthly bank statement; if on-campus, request quarterly (at least) or monthly (even better) statements, and reconcile your books then. Investigate discrepancies immediately If, in your monthly reconciliation, you find a discrepancy between the actual account and the books, investigate immediately. Don’t assume that a small error is just a glitch and that it will come out in the wash – immediately review the books, go back through statements, and get to the bottom of the problem. In 99.9% of the cases, it’s nothing to worry about – a check drops late or not at all, or something like that – but someone could be testing the waters to find out how easy it is to get away with your chapter’s money. Investigate any discrepancies in the books – no matter how small – as soon as possible. Keep on top of incoming money Even if your chapter does nothing else during the year but induct new members, you’ll still have income – the dues from your new members. Make sure to deposit dues promptly – with anywhere from 25 to 1,100 checks coming into your office in a 1-2 week period, it’s awfully easy to lose one or two. Deposit incoming dues checks promptly, and don’t allow checks to accumulate in your office. Keep a copy of your deposit ticket, and a copy of the deposit receipt from the bank or the business office with your chapter’s financial records. Be extra careful with cash Ideally, your chapter won’t accept cash for dues payments, but if you do, issue receipts for cash payments at the time of payment. Never, ever, ever accept cash from a student without issuing a receipt right then. Pick up a cheap receipt pad from a discount or office-supply store, and keep it handy. Keep a copy of the receipt, and make sure the student has a copy in their hand before they walk out the door – that way, there’s no question as to the receipt of a cash payment. Deposit any cash you collect ASAP, and make sure to keep a copy of the deposit receipt with your chapter’s financial records. Do not accept an ATM/debit/check card Checks may seem a little old-fashioned, but they’re a lot easier to track and keep up with than cash/credit receipts. With an ATM, anyone with the PIN (and if more than one person is using the card, then it’s impossible to truly secure the PIN) can withdraw cash, and that money will be completely untraceable. If that’s not a concern, the possibility that someone could confuse their own personal card with the chapter’s card, and end up making personal purchases with chapter funds should be. Make things easier on yourself and decline an ATM or check card. Very important – watch your account identification This is the one section of this document that isn’t a suggestion – it’s law. If you have an off-campus bank account, you cannot use the National Alpha Lambda Delta Employer Identification Number to set up that account. Your chapter has a subunit number that is unique to your chapter, and should be used for any off-campus accounts. Again, you cannot use the National ALD EIN to set up an off-campus bank account. Contact your bank if you’re uncertain as to what number was used to set up your off-campus account, and if your chapter is using the National EIN, contact us immediately to get your subunit number. |
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USPS: PO
Box 4403 |
1-800-9-ALPHA-1 |
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