Parent Associations and Parent-Teacher Associations:

Financial Affairs - Part 2

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Part 2 - Session Overview PA/PTA Fundraising Activity Guidelines

Interim and Annual Financial Reports

Preparing and Approving the PA/PTA Budget

Review and Audit of the PA/PTA Records

PA/PTA’s Best Practice Tips

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PA/PTA Fundraising Activity Guidelines Reminder: The PA/PTA must obtain an EIN before conducting any

fundraisers.

Proceeds from PA/PTA fundraisers must be used to enhance the educational, social and cultural programs of the school.

Fundraising activities that take place during school hours are limited to two per year. However, there are no restrictions on the number of fundraisers held during non-school hours.

The principal's written consent is needed if the fundraising activity is held during school hours or on school property.

Association members must approve fundraising activities during meetings, and the approval must be reflected in the minutes of that meeting.

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Securing PA/PTA Funds PA/PTA must deposit all funds received from fundraising in the

organization's checking account within one business day.

If this is not possible, the association has three days to deposit the funds to the organization's checking account.

If funds cannot be immediately deposited in PA/PTA bank account, funds must be secured in a locked location on school premises. The PA/PTA must obtain a written acknowledgement from the principal

when PA funds are secured in the school. This acknowledgement must include the dollar amount being secured, as verified by the PA/PTA and the principal.

Under no circumstances may fundraiser proceeds be stored in a PA/PTA member’s place of work or residence.

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Additional Restrictions on PA/PTA Spending The PA/PTA is required to allocate funds raised for a particular purpose solely

for the designated purpose (e.g., funds raised for senior dues may only be used to fund payment of activities for students in that grade for that school year).

Should there be any funds remaining, the future use of these funds is subject to approval of the membership by majority vote.

PA/PTA contributions to candidates for CEC, CCSE, CCHS, or CCELL membership, political parties, political groups or sectarian groups are strictly forbidden.

The PA/PTA may not directly hire or donate funds for the school to hire core instructional teachers (e.g., teachers who teach core subjects such as Math, Science, English, and History) to work during school hours.

The PA/PTA may not hire staff to complete administrative tasks of the association or manage PA/PTA programs.

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PA/PTA Out-of-Pocket Expenses

A PA/PTA member may be reimbursed for out-of-pocket expenses if she/he submits receipts.

Out-of-pocket expenses must be approved by the membership. Whenever possible, membership approval should be obtained prior to

making an out-of-pocket expenditure.

The bylaws must define permissible out-of-pocket expenditures and the maximum dollar amount for which a member may be reimbursed.

Reimbursement must be made by check payable to the member, and not in cash.

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PA/PTA Fundraising Activity Report PA/PTA Executive Board must prepare a Fundraising Activity Report

after each fundraiser. The Fundraising Activity Report must include the total amount of funds

received and the related expenses.

The Fundraising Activity Report must describe the program goals for which the funds will be used to support .

The report must be distributed to the members at the general membership meeting following the conclusion of the fundraiser.

A copy of the report must be provided to the principal no more than five school days after the conclusion of the fundraiser.

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Snapshot: Fundraising Activity ReportFundraising Activity Reports may be found at http://schools.nyc.gov/parentleadership

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PA/PTA Interim and Annual Financial Reports The PA/PTA executive board must prepare an Interim Financial Report

by January 31st of each year. The Interim Financial Report reflects all financial activity occurring between

July 1st and January 15th.

The PA/PTA executive board must prepare an Annual Financial Report by June 30th of each year. The Annual Financial Report reflects all financial activity occurring between

July 1st and June 30th.

Copies of both reports must be distributed to the general membership and provided to the principal.

The Interim and Annual Financial Statements include the following: Beginning balance for the period

Itemized income

Itemized expenses

Closing balance for the period.

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Snapshot: Interim and Annual Financial Reports

Financial Reports may be found at http://schools.nyc.gov/parentleadership

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The PA/PTA BudgetSteps To Preparing A PA/PTA Budget

1. The outgoing PA/PTA executive board (or Budget Committee) must review the current budget, financial reports, expenditures and outstanding bills and create a proposed budget for the following school year in May.

2. The general membership must approve the budget by June.

3. Once approved, the PA/PTA Budget must be filed with the principal.

4. The incoming PA/PTA executive board must review the budget in September. Any amendments may be addressed during the September meeting.

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Membership Approval of the PA/PTA Budget The PA/PTA general membership must approve all expenditures

during a regularly scheduled meeting where a quorum is achieved.

The approval must be included in the meeting minutes.

The bylaws must contain a process for executive boards to authorize emergency expenditures. The bylaws must outline the circumstances that warrant an emergency

expenditure, a maximum dollar amount that may be allocated, and a timeline for reporting emergency expenditures to the membership.

At the next general membership meeting following the emergency expenditure, members must have the opportunity to vote on whether the emergency expenditure was an appropriate use of the funds.

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June Transfer of PA/PTA’s Records Outgoing executive board members are required to arrange for the

orderly transfer of records to the incoming executive board members.

The outgoing treasurer must assist the incoming executive board with the June transfer of PA/PTA financial records by explaining the details and history of all programs, income sources and expenses for the school year.

If there are outstanding debts, the outgoing treasurer must explain the reason the debts were not paid and provide the incoming executive board will all related documentation.

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Retaining PA/PTA’s Records All PA/PTA records must be kept for 6 years.

The PA/PTA must store records in the school. The school must provide a locked location for the storage of PA/PTA records. Wherever possible, the principal should designate a room or space for

PA/PTA use.

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Requesting a Review of the PA/PTA Records The PA/PTA financial records must be available for inspection by

members upon request and reasonable notice, and at a mutually agreeable time.

Any PA/PTA member may submit a written request to the executive board, identifying the specific records to be reviewed.

The PA/PTA executive board must provide an opportunity for members to review requested documents within a reasonable period of time.

Reviews of financial records must be conducted in the presence of the executive board and two general members not affiliated with the request.

A review sheet that lists the assessed documents must be signed by all the members present.

Upon request, the PA/PTA executive board must make every effort to provide members with copies of the documents reviewed.

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PA/PTA Audits Audits are reviews of financial records conducted to reconcile

revenue and expenditures and determine compliance with applicable laws, policies, rules, and regulations.

Audits are tools that can help the PA/PTA analyze its financial activities and assess the quality of its record keeping.

It is recommended that the PA/PTA conduct an internal audit every year prior to the completion of the Annual Financial Report.

An audit committee must be established to conduct an internal audit.

The audit committee must be selected by the general membership and be comprised of a majority of general members.

Signatories of PA or PC checks may not serve on or guide the work of an audit committee.

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Inappropriate PA/PTA Financial Practices The Chancellor or FACE may order corrective or disciplinary action to

address financial discrepancies or wrongdoing.

FACE may recommend specific action and suspend fundraising activities of a PA/PTA, in instances where a member or members have been found responsible for inappropriate financial practices, including recklessness or a failure to safeguard PA/PTA funds.

A PA/PTA member found responsible for financial discrepancies or wrongdoing may be removed from PA/PTA office and prohibited from subsequently serving on any local, district or citywide parent organization.

Allegations of criminal wrongdoing on the part of a PA/PTA member must be reported to FACE and the police.

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Best Practice Tips! Use binders to store documents.

Record each transaction as it occurs in the PA/PTA ledger.

Maintain a duplicated pre-numbered receipt book.

Receipts must be provided to anyone who makes a payment or offers a donation to the PA/PTA.