Most people think that president is the toughest job in PTA, but in reality, it is probably the treasurer’s job that is the hardest. Not that the work is difficult—it is mostly just addition and subtraction and attention to details—but that the stakes are high. As treasurer, you are ensuring that all the PTA funds are being tracked accurately and are ready to be reported to your PTA membership and to the government. Here are our top ten tips to help new PTA treasurers make the toughest job in PTA a bit easier.
- Make sure the audit is done before you officially take over the books. Once you take over the PTA’s books, you are responsible for everything they contain, so make sure the audit is complete and shows that everything is in order before you take responsibility for them. This does not mean that your membership needs to have approved the audit report before you take the books, just that the audit committee has signed off on the audit.
- If you’re not a signatory, serve on the audit committee. As an incoming treasurer, serving on the audit committee is a great way to learn how the PTA handles their books and tracks the funds flowing through the PTA.
- Make sure you get all the financial records from the previous treasurer. The treasurer’s job is a lot easier if you have all the PTA’s financial records available to look back at and see what was done in previous years. Information on most government forms won’t change much from year to year. Work with the previous year’s treasurer to get the records to you.
- Update the signatures for the PTA bank account. Updating who can sign checks for your PTA is critical for the coming year. Contact your bank to ensure you have whatever paperwork they need to change the signatories on the account (e.g., minutes from the election meeting, previous signatories signing off the account, etc.).
- Agree with the other signatories to the PTA account to change passwords. Whether it is online access to the bank account, social media accounts, or MemberHub, make sure that passwords and who can access accounts are changed over.
- Know your fiscal year and your PTA’s EIN. Your PTA’s fiscal year determines when your tax forms need to be filed. For most PTAs, the fiscal year is July 1 to June 30. It should also be included in your PTA’s bylaws (Article XIV). You can also double-check using your PTA’s Employer Identification Number (EIN) on the IRS website. You can find your PTA’s EIN by looking at a previous year’s Form 990 or by contacting your district or region director.
- File your Form 990 with the IRS. While PTAs are 501(c)(3) non-profit organizations and are generally not required to pay taxes, your PTA does have to file a Form 990 with the IRS annually. For most PTAs, this is the online postcard Form 990-N. Your Form 990 must be filed by the 15th day of the fifth month following the end of your fiscal year (November 15 for PTAs whose fiscal year ends June 30). You do not have to wait until November to file. Once the audit is complete, you have all the information you need to file. Printing out a copy of the online receipt and filing it is a good practice.
- Always do your treasurer’s report. You should provide a treasurer’s report for every executive committee, board, and general membership meeting. Your report should work off the calendar month, as this provides an easy divider between months. You do not need to include every check written in the report. Rather, start with the funds on hand at the beginning of the month, the deposits made on each budget income line, the expenses paid on each budget expense line, any outstanding payments or deposits, and the reconciled funds on and at the end of the month. Note that failure to provide regular treasurer’s reports is considered a red flag for potential misuse of PTA funds.
- Always have two people count cash. The most common misuse of PTA funds is someone pocketing cash. By having two people count any cash, having the treasurer count the cash given to them with at least one of the original counters present, and using a cash out/cash in form that leaves one copy with the original counters and one copy with the treasurer, your PTA can minimize the possibility of this happening.
- Don’t write a check without an expense form; don’t make a deposit without a deposit form. As treasurer, you need to know not just how much money is coming in to your PTA or going out. You need to know what budget line those funds are assigned as well. Using expense and deposit forms can help track that and maintain a paper trail for all PTA funds.
While many of these tips on proper handling of funds may seem like a lot of paperwork (e.g., expense forms, deposit forms, cash out/cash in forms), using these best practices to provide a paper trail for every penny coming into or going out of your PTA protects you as PTA treasurer from being accused of mishandling funds. Check out our 9-minute PTA Essentials video on handling PTA funds for further information.