This school year has been anything but normal as so many of our children have been taking classes at home. However, it is coming to a close and that means it’s the year end for your PTA, PTO, or booster club.
Many PTOs and PTAs choose a June 30th fiscal year-end, as it is a time that’s less busy than August when back to school planning and potential last-minute vacations are the order of the day. If you plan and organize now, your final bank statement for this year can be reconciled by July first. Once your year-end audit is complete, your treasurer will have nothing to worry about for the rest of the summer.
We’ve put together some simple steps to make your year-end closing simpler:
Form your audit committee
If you haven’t selected this team, make it a point to elect one at the year end. Generally, three people make the perfect size team to get the job done.
We recommend that you have at least one member without check-signing authority for the group or anyone whose relationship would bias the audit. In fact, you may want to reach out to past officers of the group.
Here’s a thought: your incoming treasurer is a great choice, as working on the audit will give them a handle on their job for the next school year.
Elect new officers
When it’s time for new officers, it’s important to try and make the year-end transition go as smoothly as possible. After all, if your group is to continue to grow and improve, it’ll need some new faces. Our article, Smooth PTA/PTO Officer Transitions, will give you plenty of advice on making this process simpler.
Review your policies
Even though school’s out and your fiscal year is at an end, you still need to keep your insurance policy current, even as COVID-19 is canceling so many face-to-face events. You’ll also need to ensure your property is protected from theft, fire or vandalism.
While we hope people will pull together in these uncertain times, your organization still needs to protect your funds from embezzlement. For some common sense advice, we’ve put together a list of Top 10 Ways to Protect Against Organization Embezzlement.
Who would want to sue your PTO, PTA, or booster organization? Don’t be caught unaware. Be smart and read up on how often lawsuits occur in our article, Do PTO and Booster Club Lawsuits Happen?
How long should you keep financial files?
With the end of the school year, you may be tempted to do some house cleaning. However, according to the IRS, you should keep your monthly treasurer reports for at least three years, whole bank statements, canceled checks, check registers and IRS 990 forms should be saved for seven years.
You should never throw away your IRS determination letter for 501 © (3) tax-exempt status, as well as your incorporation paperwork, IRS form 1023, year-end reports, meeting agendas and minutes, and your annual financial review reports.
Check out the year end checklist
We’ve created a PDF checklist that lays out every step of closing out the year. Even if you’re done the year end process before, this list is a great resource for your parent/teacher group. You can download the checklist before you start your closing process.
If you discover that your policy is leaving you unprotected, AIM is here to help. We offer affordable insurance programs – tailored to the needs of groups like yours – that will protect you and your officers.