Student Activity Accounting

1. Student Activity Accounting Let the Fireworks Begin

2. Introduction • Extracurricular fund activities are those organized student activities that do not fall within the scope of the regular district curriculum. • The use of the student extra-curricular funds is limited to the benefit of the students. Students shall be involved in the decision making process related to the use of the funds. • The authority to establish an extracurricular fund is found in Section 20-9-504 MCA.

3. Internal Controls • Are Employee’s Bonded • Is the safe combination where cash is stored changed periodically/turnover of personnel? • Where are unused Checks Stored-Secure location. • Where are voided checks stored – are they mutilated to prevent reuse. • Received Checks are they endorsed upon receipt. • Dual Signatures on checks – Should be required • Are NSF Checks researched in a timely matter to collect – Should have policy on this. Sample Attached. • Are all receipts counted by one individual and verified by another before turning in cash boxes.

4. Are Receipts pre-numbered • Are financial reports available when requested and reported monthly to board of trustees. • Are current signature cards on file with the bank? • Are inventories done to prevent loss? • Yearly audits must be completed in conjunction with district wide audit.

5. Administrative Policy • The board of trustees should develop written policies for the administration of extracurricular funds. • Once policies are established they should be subject to constant review and expanded when necessary. • All transactions in extra-curricular funds are subject to the approval of the Board of Trustees. • An audit of the extra-curricular funds is conducted in conjunction with the audit of other funds of the district.

6. Administrative Responsibilities – Board of Trustees • The Board of Trustees is responsible for the establishment and management of student extracurricular funds. • The Board of Trustees authorizes the District Superintendent to designate the fund custodians and to establish the accounting procedures for all student extra-curricular funds.

7. The admission of new clubs or activities to the extracurricular fund must be submitted and approved by the Board or its designated representative (usually Supt.). • The cancellation of extracurricular fund checks will require prior approval from the board or its designate. Outstanding checks should be cancelled after one year of date of issue. Make sure you have this in a motion in the board minutes. Hint: Do this every June Board Meeting.

8. Non-sufficient fund checks cannot be written off without first obtaining approval of the board or its designate. • Inactive fund accounts should be reviewed by the board or its designate each June, those accounts discontinued should have any remaining balance transferred to a related account.

9. Fund accounts should not be permitted to become overdrawn. • Each Club must maintain separate financial records and reconcile with fund custodian. • Board should review adequacy insurance policies. • Board should review bond coverage to make sure activity accounts are covered.

10. Each May the board or its designate should direct the Senior Class to dispose of any money remaining. Such disposition should be accomplished by one of the two methods. • The Senior class could designated the balance for a specific purpose and authorize the expenditure immediately. • The Senior class could authorize the balance to be transferred to a designated fund account.

11. The practice of making lump sum payments to the extracurricular fund from school district funds should be restricted. This practice weakens internal control. • The board should have a policy regarding the handling of cash overages and shortages. (ticket sales)

12. Funds that do not belong in extra-curricular accounts • Faculty flower/coffee/lounge funds • Booster club money • Rental receipts for district facilities & equipment. • Book fines • Drivers Education fees • Petty Cash • Sale of district supplies or equipment • Lunch monies • Reimbursements from insurance companies

13. Fees & Charges • “A school district may not levy fees or charges for a course or activity for which credit may be applied towards graduation.” • If such collections are for fees or project supplies not required for graduation then reasonable charges may be imposed. • If such fees or charges originated from district sources, then these collections must be deposited into the proper district fund.

14. Investments • Trustees may direct the Clerk/Business Manager to invest any excess money in the extracurricular fund in accordance with the provisions of 20-9-213(4). Interest earned as a result of the investments may either be: Credited to a general operating account within the fund to be used to offset expenses incurred in administering the fund or distributed to the funds from which the money was withdrawn for investment on a prorated basis.

15. Inventory/Fixed Assets • Items purchased by a particular program or group must maintain an inventory, this is if it is under the capitalization amount set forth for fixed assets. • It is very important that the inventory of extra-curricular activity accounts be maintained.

16. Inventory/Fixed Assets • Each fund account sponsor is responsible for conducting inventory and forwarding copies to the fund custodian.

17. Change Fund • A change fund may be necessary for making change at athletic events, concessions and other student activities, a change fund may be establishing by: • Issuing a check against the bank control account, thereby reducing the cash in the bank account and increasing the cash on hand account. • This cash will be retained throughout the year and would then be redeposited separately at the end of the school year.

18. CASH BOXES • Setting up of cash boxes is necessary for ticket sales, cake raffles, dances, etc.. • This is done by using the cash obtained from the change fund. • Before cash boxes are released money needs to be counted and person checking out box needs to sign. DO NOT GIVE CASH BOXES OUT WITHOUT CASH BOXES BEING COUNTED FIRST!!!

19. Ticket Sales • Only Pre-Number colored strip tickets • Different tickets & colors for each price class • Tickets are checked out to seller • Seller must reconcile at end of event number of tickets sold to money collected • Seller and fund custodian must sign reconciliation sheet at end of event • Watch for seller tearing off tickets at end of event to reconcile, DO NOT LET HAPPEN

20. TRAVEL • A request for travel authorization and funding must be prepared well in advance of the time the funds are needed • Travel forms are to contain at least the following information • Date of request, date funds needed, destination/purpose of trip, estimated departure & return times, number of persons making trip, estimate of cash required, estimate of other expenses, signature of person requesting authorization, signature of approval from principal, superintendent or designee, check number and date of payment, credit card or checkbook issued, signature of fund custodian.

21. Payment Options for student travel • Credit cards/Procurement Cards • Open Account – Purchase orders • Per diem • Cash Advances • RECEIPTS MUST BE TURNED IN USING ANY OF THE ABOVE OPTIONS AND A FINAL ACCOUNTABILITY REPORT MUST BE TURNED IN TO THE FUND CUSTODIAN

22. Receipting in Money • Receipts must be issued immediately upon collection of money • Checks need to be endorsed with “for deposit only” stamp immediately upon receipt • Receipts should be pre-numbered and must consist of the original and one copy • Computer generated receipts and all receipts need to be initialed by fund custodian • Receipts must contain the following information • Date of receipt issued • Payer • Amount received • Purpose or source of money • Designated fund or funds to which to cash is to be deposited

23. Depositing of Receipts • Must be deposited regularly, the amount of cash held at the school must not exceed the maximum coverage of burglary insurance • Closing day of each month a deposit should be made • Deposit slips must show the receipt numbers that, when totaled, correlate with the deposited amount

24. Cashing of Personal, extracurricular checks & school warrants. • This is absolutely prohibited

25. Intra-Fund Transfers • Transfers of money from one student account to another is allowed only when such transfer is justifiable and supported by proper authorization • Transfer forms should contain name of school, date and space for transfer number (to be assigned by fund custodian) • Reason for transfer • Amount to be transferred • Name of fund accounts affected • Approval of fund account sponsor, president or treasurer • Approval of fund designee • Posting verification and reference by the fund custodian • Must keep form on file after transfer is completed.

26. Non-Sufficient Funds Checks (Bad Checks) • Checks returned are to be carried as cash items on hand • NSF checks should immediately be re-deposited on a separate deposit slip • NSF checks returned more than once the fund custodian must notify the author of the checks to attempt to make collection • If cash or other replacements are made for the NSF check the proceeds should again be re-deposited on a separate deposit slip. • If a NSF check is determined to be uncollectible by the fund custodian, the fund custodian should seek collection assistance from the county attorney • If all collection attempts fail, the fund custodian should then submit a memo to the board of trustee requesting authorization for cancellation, memo should include, date/author/amount/purpose/ and account check was receipted into and cancellation authorization by the Board

28. Disbursing Procedures and Requirements • All extracurricular fund disbursements must initiate with and be authorized by representatives of the fund accounts to which the disbursement will be charged. (Class or Club president, treasurer)

29. Disbursement authorization • Must Contain • Name of Vendor or payee • Date of order • Fund account or accounts to be charged • Detailed description of items or services purchased • Signatures required (fund sponsor, president or treasurer and fund custodian • Verification of receipts of goods or services (invoices, packing slips, etc.) • Following payment, check number should be added to authorization form • NO CHECKS SHOULD BE ISSUED PAYABLE TO CASH!!

30. Disbursing Referee Checks • Referee’s must be MOA licensed officials before no taxes are to be taken out • Referee’s must sign activity contract stating that they are solely responsible for all taxes • Contract must include • Contract Date • Officials Name • Officials Signature • Officials S.S. # for 1099’s if needed (Over $600.00) • Athletic Directors Signature • Date • If you have referees that are not MOA officials, the school district is liable for all taxes, unemployment and workers comp. Run through regular payroll • Do Not Cash Referee Checks

31. Official Independent Contractors!! • Section XXVI – MHSA Handbook, page 273. • Schools must pay all fees & expense allowances directly to officials with individual checks prior to the contest. • Schools are NOT permitted to pay pools or officials’ groups any fees which are then to be later distributed to member officials. • MOA members cannot accept checks written to other MOA officials. If unforeseen circumstances result in a change in official(s) scheduled to work a contest, and the school has written checks for the previously scheduled official(s), the incorrect checks(s) will not be issued or cashed. It is recommended that the school has one week from the date of the contest to reissue appropriate checks to the officials who actually worked.

32. Monthly Reconciliations • Each month all receipts-disbursements must be totaled • Individual fund account balances must be verified in the following manner • Beginning Balance • Receipts for month • Disbursement for month • Transfer for month • Ending Balance

33. Total of all individual fund accounts must be in balance with combined total of the cash control and bank control accounts • Any remaining balance shown in cash control must be identified (change fund, NSF checks, up-deposited receipts) • Balance shown must reconcile with bank statements received each month, EVIDENCE OF THIS RECONCILATION MUST BE AVAILABLE FOR INSPECTION • NO ACCOUNTS SHOULD EVER HAVE A NEGATIVE BALANCE

34. Reconciliation of bank accounts is to be made a follows: • Balance per bank statement • Add Deposits in transfer • Less Outstanding Checks • Less Monthly bank charges or costs if any • Resulting reconciled bank statements must equal register bank control account

35. Monthly Report to Board of Trustees • Each month a report of reconciliation and fund activity must be presented to the board of trustees for their review, Report must show the following information • Statement of receipts, disbursements and fund balance • Fund Account • Beginning monthly balance of each account • Receipts of each fund account • Disbursement of each fund account • Transfers of each fund account • Ending monthly balance of each fund account • Initials of fund account sponsor/president/treasurer acknowledging that fund account receipts, disbursements, transfers & balances are correct • Signed by fund custodian and approved by board chairman.

36. Destruction of Records • State guidelines • Montana Local Government Retention and Disposition Schedule • 20-1-212 MCA

37. References • Student Activity Fund Accounting manual found on MASBO web site. • www.MASBO.com • ASBO Student Activity Fund Accounting Manual • www.asbointl.org

38. Reporting of Activity Fund on District’s Trustee Report • Extracurricular fund activity MUST be reported as a trust fund on the Trustee Financial Summary under fund number 84

39. THE ENDMaryetta Engle-Big Sandy School District (406)378-2502 mengle@bigsandy.k12.mt.usKathy Preeshl-North Star School District (406-355-4481 kpreeshl@nsschools.org