PROTECTING THE PTA’S FINANCIAL ASSETS

Fiduciary Responsibility:
As a member of the board of directors of an organization (your PTA unit), it is the individual responsibility of each board member to make sure the organization is operating in a fiscally, financially, and legally sound manner.

When an individual becomes a board member, either through election or appointment, that person becomes legally obligated to prudently, properly and responsibly conduct themselves (as an individual), and to be sure the organization conducts itself in a manner so that the best interests of the organization and its members are protected and preserved.

If an individual, as a member of a board, fails to exercise reasonable caution and care, that person is left open, not only to criticism from their peers, but to potential personal liability for financial losses or damages resulting from failure to exercise reasonable care during the term as a board member.

Prevention:
1. Update the signature cards at the bank:
• when an individual who is authorized to sign legal documents resigns from the organization, or
• when newly elected officers officially assume their duties, e.g. as of July 1st.
• All checks must have TWO signatures
2. All PTA mail is sent to the school’s address or PTA USPS mailbox.
• No PTA mail should ever go to a person’s home address.
Bank Statements
IRS form 990
Personal Property Tax forms
Sales and use tax forms
Employer quarterly tax forms
3. Monthly Written treasurer’s reports showing expenditures since the last report and comparison with budgeted amounts (and attach a copy of the monthly statement).
• Reports and budget must reflect gross income, not net income.
4. Resolve each bank statement and have an officer without signature authority compare the resolved bank statement with the treasurer’s report.
5. Establish, in writing, the process for handling PTA funds and which individuals are authorized to handle PTA funds.
6. Deposit PTA funds in the PTA bank account immediately upon receipt.
7. NEVER sign a blank check.
8. Use “disbursement request forms”. Completed forms should include an approval signature and attached receipts to support the amount of the check requested.
9. Pay all bills by check WITH TWO SIGNATURES. This is in accordance to your bylaws.