Breakout Session # 4

2. Chapter Financial Management Breakout Session # 4 Mark W. Chavez, CFCM, CPCM, Fellow, Rio Grande Chapter, NCMA Board of Directors Laura Lovato, Bandelier Chapter June 23, 2007 10:50am-11:50am Chapter Financial Management

3. Overview of the Accounting Function • Safeguard assets. • Deposit funds. • Pay bills. • Maintain accurate records. • Prepare an annual budget. • Arrange for an annual audit. • Prepare annual financial report. Chapter Financial Management

4. Safeguard Assets Separation of duties is essential. • Person receiving funds should not be the same person that deposits it or accounts for it. Registrar • Receives the funds on site. • Records who paid what when, and in what form (cash, check, credit card). • Retains a copy of the receipts record. • Signs over funds to Treasurer. Treasurer • Deposits funds in bank. • Records deposits in ledger. • Retains deposit slips in accounting records. Chapter Financial Management

5. Deposit Funds Deposit funds immediately. • Deposit exactly what you receive. • Do not write a personal check to cover cash. • Do not use cash received to pay expenses – use checks. • Deposit slips should specify amounts for checks and cash. • Credit card receipts are deposited directly to your bank account. Chapter Financial Management

6. Pay Bills Always obtain and retain documentation. • Pay timely to avoid damaging NCMA’s credit rating. • Pay via check. • Have a policy and procedure in place for approving expenditures. • What can individual officer spend without higher approval? • Who approves expenditures? President? Board? At what levels? • Chapter may obtain credit cards or debit cards for its officers. • Be sure to keep all receipts and turn in expenses on time. Chapter Financial Management

7. Refunds • Issue refunds in the same way that the funds are received. • Do not refund a credit card payment via check. • You can refund cash via check. Chapter Financial Management

8. Maintain Records • Check Register. • Bank Statements and Reconciliations. • Supporting documentation for all income and bank deposits. • Registration lists for paid chapter events should be reconciled to deposits. • Monthly Financial Reports. • Review with your chapter board at monthly meetings. Chapter Financial Management

9. Maintain Records • Supporting documentation for all payments. • Invoices • Expense claims • Chapter Property. • Purchases. • Documentation of property disposal. • Signed record by individual property is assigned to. • Annual Financial Report. • Original due to national office annually by August 31st. • Annual Audit Report • Original due to national office annually by August 31st. Chapter Financial Management

10. Prepare Budget • A simple forecast of income and expenses. • Time phase so you understand your cash flow month-to-month. • Monitor progress against budget periodically, and revise forecasts. • Should be developed with the leadership team as part of annual planning process. Chapter Financial Management

11. Prepare and Submit Reports • Annual Financial Report must be submitted to the national office by August 31. • Report to cover the fiscal period July 1 – June 30. • Important to meet deadline in order to be included in the Group Tax Return. • Annual Financial Audit must be submitted to the national office by August 31. • Report to cover the fiscal period July 1 – June 30. • Audit must be performed by an independent person, who is not a chapter officer or was otherwise involved in the financial management of the chapter during the period being audited. Chapter Financial Management

12. Chapter Rebates • Payment based on $10 per regular member, $8 per Organizational member. • No rebates on associate, retired, student or other complimentary membership types. • Rebates shall not to exceed $1,000 per chapter per program year. • FY 07 rebate calculated on members as of June 30, 2007. • Payments will be issued upon receipt of your Chapter Annual Report with all required attachments. Chapter Financial Management

13. Chapter Rebates • Rebates payable to ineligible chapters will be retained for a period of two years. If at the end of the second year the chapter’s records are still not current, the rebate accrual will be cancelled, and the funds will no longer be available to the chapter. Chapter Financial Management

14. Taxes • Chapters are covered under the group return filed by the national office. • As a 501(c)(6) organization we are normally exempt from federal income taxes. • Exception – Unrelated Business Income Tax. • Advertising revenue. • Chapters should have their own Federal Identification Number. • Obtained by filing Federal Form SS-4 located on the intranet. • If contacted by IRS regarding tax audit, filings, or request for information, contact Sam Smith, CFO, at ssmith@ncmahq.org. Chapter Financial Management

15. Tools Available • Credit card processing software. • Application can be found on the intranet. • Funds will be deposited directly into the chapter bank account. • Quicken software. • Easy to learn. • Efficient data input. • Basic reports available. • Easy to display information in Chart Format. • Bank reconciliations performed quicker. • Query feature. • Provided free of charge by national upon request. • National will provide assistance with the setup. Chapter Financial Management

16. Signs of Trouble • Financial reports not presented to chapter board each month. • Bills not being paid on time. • Checks not being deposited timely. • Treasurer not returning calls, emails or attending board meetings. • Unexpected reductions in bank balances. • Avoiding or not cooperating with annual audit. • Insistence on remaining treasurer year after year. • Suggested term is not more than 2 years. If you become concerned about the chapters finances, contact the national office immediately. Chapter Financial Management

17. For Further Assistance Mr. Sam Smith, CPA NCMA Chief Financial Officer 800/344-8096 x404 ssmith@ncmahq.org Ms. Wendy Murrah NCMA Chapter Relations Manager 800/344-8096 x411 murrah@ncmahq.org Chapter Financial Management