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Student Body Accounting and Activities. February 2008. Organization and General Policies – Unorganized Student Bodies. Based in Ed Code 48938 Student Body Policy – gives overall structure Elementaries, Continuation Schools, and Adult Schools may establish unorganized student bodies
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Student Body Accounting and Activities February 2008
Organization and General Policies – Unorganized Student Bodies • Based in Ed Code 48938 • Student Body Policy – gives overall structure • Elementaries, Continuation Schools, and Adult Schools may establish unorganized student bodies • Usually no student councils (making monetary decisions) • Usually no student clubs • May do fundraising • Principal oversees the raising and spending of funds
Governance – Unorganized Student Bodies • Principal is primarily responsible for all ASB activities including • Opening bank accounts • Assigning staff to maintain accounting records • Assigning staff to prepare monthly bank reconciliations • Reviewing bank reconciliations • Deciding what fundraising will occur • Deciding how funds raised will be spent
Budget Requirements – Unorganized Student Bodies • Budgets are usually not necessary for unorganized ASB’s • Periodic budgets may be helpful when fundraising for big-ticket items • Revenue Potential forms should be used • The funds raised in a given year should be utilized to benefit the current student population, and not carried over to future years
Organization and General Policies – Organized Student Bodies • Based in Ed Code 48930 • Student Body Policy – gives overall structure • Secondary schools have organized student bodies with a formal constitution, student body officers, and minutes of meetings • Clubs are formed under Student Councils • Must submit a proposed charter or constitution • Must have officers and an advisor
Budget Requirements – Organized Student Bodies • Each High School ASB should have a finance committee (and recommended for Middle School ASB’s) • Committee is responsible for submitting a budget each year • See sample budget (FCMAT manual)
Budget Requirements, cont. • Preliminary budgets should be submitted annually (by approx 5/15) • Periodic budgets should be submitted quarterly (optional) or at the beginning of the second semester at the High School level • Final budgets must be submitted annually (by approx 11/1 following the fiscal year). These should compare estimated budget with actual.
Cash Receipts • Most common audit finding • Sample finding: “Cash collections are being verified and receipted at the time of deposit to the District Office, rather than at the time or soon after the collection of the money by the bookkeeper (secretary).” • See Cash Receipt memo for process
Segregation of Funds • MS and HS can have checking, savings, petty cash, and change funds • Elementaries (& continuation & adult) usually have one administrative account • Use Petty Cash Reconciliation and Petty Cash Reimbursement forms • Follow petty cash guidelines
Segregation of Funds • Petty cash guidelines: • Should be $250 maximum • Individual disbursements should not exceed $50 • Should not be used to cash checks for faculty or others • Should not accept IOU’s • One custodian only (designated by principal) • Clearly mark all supporting invoices “paid” (date & initial) when fund is reimbursed • Conduct a cash count each time the fund is reimbursed (someone other than the custodian). Cash + invoices = total of fund
Bank Facilities and Investments • ASB funds may be held in any bank/agency that is insured by FDIC, FSLIC, NCUA, or comparable agency • The ASB must submit authorized account signatures to the agency annually • Funds may be invested in CD’s and bonds, but not in stocks or mutual funds • All accounts should be interest bearing (recommended)
Expenditures • See Expenditure handout, and FAQ’s • No classroom or core curricular expenditures allowed • May be spent on non-instructional items that augment and enrich the educational experience • No gifts, loans, or unusual ventures • No scholarships in excess of $250 per person • Must benefit the current student population.
Authorizations for Expenditures • Must receive necessary approval beforehand on requisitions • Elementaries/Unorganized Student Bodies: • Requires principal’s authorization • Principal should designate a second person to also approve disbursement of funds • MS and HS Student Bodies: • require principal (or other District designee), advisor, and student representative authorizations • Proposed expenditures and estimated amounts may be formally approved in writing by the principal or officers in advance
Contracts • May not be for more than the current school year • Need to issue a 1099 if contracted for > $600 • Typical contracts: Vending machines, yearbooks, disc jockey, picture sales, etc. • Know the difference between an employee and a contractor • Does the worker set their own hours, set their own contract or hourly rate, furnish their own tools and equipment? (= contractor) • Does the person work “at will” of the District – regular and continuous basis; District sets hours, trains and provides instruction, controls work performed. (= employee) • Must have District signed contract in place (obtain through purchasing department)
Employees of ASB • ASB’s can hire employees, but the District is the employer and pays salaries, then bills back the ASB • Cost includes salary and benefits, and regular hiring process (finger prints, etc.,) applies • Hiring must be approved by the principal and designee • HS MS examples: finance clerk, coaches • Unorganized Student Body examples: part-time finance clerk at adult school, or extra duty hours if elementary secretary types up a play program after hours
Expenditure Procedures • The first step is preparing a requisition that has the two (or three) approved signatures • The requisition will generate a PO, which encumbers funds and may be paid upon • When an invoice or request for reimbursement is received, it is matched to a PO, and marked “OK to pay”, with initials and date • Voided checks should be destroyed, and no checks should be honored past six months of issuance
Allowable Expenditures ASB organizations have tremendous flexibility and discretion regarding how they may use their funds. Allowable purchases: • Magazine subscriptions • Library books • Field trips/excursions • Extra-curricular athletic costs (including game officiating and security) • Student social events • Scholarships • Supplemental equipment (aquarium, telescope, video camera) • Indirect charges
Prohibited Expenditures • Salaries or supplies that are the responsibility of the District • Repair and maintenance of District owned equipment and facilities • Articles for personal use of employees (e.g. laptop for principal, leather jacket for coach) • Faculty meeting expenses and refreshments • Expenses for PTA’s or Boosters • Large awards, gifts of any kind • Employee appreciation meals, employee clothing/attire, • Donations • Cash awards to anyone
Internal Controls • Internal Controls for cash receipts and cash disbursements must be in place • Key: limit access to checks to authorized personnel only • Only use imprinted receipts authorized by District • Reconcile receipts issued to deposits made • Use only pre-numbered imprinted checks • Checks should never be made out in advance with blank amount or payee; never made out to “cash” or “bearer” • All bank accounts should be reconciled monthly. • Ticket sales – 1 person should “issue” tickets, and a different person(s) should sell. Don’t issue to self. • Ticket inventory should be reconciled to receipts on all ticketed events
Equipment • Equipment costing >$500 must have approval from the District Purchasing Director (e.g.) • Recommend that equipment be donated to the District, therefore cost of maintenance and insurance (& liability) is a District expense, rather than student body • Donations to District will always be marked and inventoried as belonging to donor group
Required Reports • Current reconciled bank statements, which tie to subsidiary trust account reports, are most important to the auditors. • Monthly cash receipts and expenditure reports should be sent to the District office • District office may prepare these for unorganized student bodies
Sales and Use Tax • No sales tax is due on candy and snack food when sold on an “irregular” basis (student stores are usually considered a “regular” basis). • Do not pay sales tax on items purchased for resale (show vendor your resale permit # if applicable). • On occasion, use tax may be due on items such as pencils for a vending machine. (Recommend discussing with finance department.)
Food Sales • Please see competitive food sale memo • Restriction of competitive food sales has always been the law • Ed Code 48931 is actually not too restrictive, but states “The State Board of Education shall adopt policy and regulations…”, which is where the trouble began… • CCR 15500 is very restrictive • County Counsel has come out with an even more restrictive interpretation of the law • New State laws regarding food & beverage nutrition
Fundraising • All fundraisers must have prior permission and be on “school activities calendar”. Fill out fundraising request form. • Note: • Not during class time • Voluntary basis • Not after dark • MS & Elem must have adult supervision, and not sell/solicit alone • No raffles allowed (though non-profit organizations may register annually to conduct authorized raffles).
Fundraising, cont. • Revenue Potential Forms must always be filled out. • Should be filled out for: • Candy sales • Class Fundraisers • Dinners • Drama productions • Magazine sales, product sales, etc. • Dances
Fundraising, cont. • Always have a site administrator review the form • Always have another party reconcile the receipts to the planned revenues • Prohibited Activities – see FCMAT manual • Social Events should be on campus, and not during class time (e.g. dances)
Ticket logs • Ticket logs are important. Failure to utilize properly will lead to an audit exception • Ideally there is one log (and one ticket roll) for the whole site • Tickets are assigned out • Unused tickets and money are turned in • Sales analysis and log reconciliation should be done for each event (see example)
Booster Clubs and PTA’s • These are completely separate entities • Principals should meet with clubs annually to explain guidelines and expectations • Cash is always kept separate • Do not fall under District supervision or jurisdiction • Great to utilize for gifts to the ASB or specific clubs
Gifts • Student Body funds cannot be gifted to individuals, booster/parent clubs, teachers, or club sponsors • Must be used for benefit of current students body/group as a whole • Can raise specified funds for unique individual scholarship or crisis needs, if purpose of specific fundraiser is clearly identified • See also FAQ’s
FAQ’s • This memo addresses many questions that may arise. • Expenditures and Purchases: • Allowable: • Playground equip • Club equip (sports, musical, etc.) • Awards/certificates • Supplies for special events • Prohibited: • Dunk tanks • Animal rides/mechanical rides • Darts • Trampolines
General Audit Findings • Key components: • Cash receipts/sub receipts • Inventory • Timely deposits • Fees collected • Appropriate expenditures • Budgets • Constitutions/charters • Minutes from meetings • Revenue Potential forms
Odds and Ends… • Remember to keep your eyes open for counterfeit bills! • Remember lotteries and raffles are illegal. • Keep ASB records for 3 years, tax returns (sales) 4-5 years, minutes of meetings indefinitely • Remember – cannot collect dues for club memberships