Financial Assistance

[MajBob]

Thank you all for your advice and suggestions. You have been most helpful, and I really appreciate hearing the experiences of others more steeped in the culture of the BSA than I.

 

I am also treasurer for a political action committee, where we use a Request for Disbursement form. The requestor provides a description of the purpose of the disburse, attaches itemized receipts, and/or the bill. After PAC President signs the request, as approval, she forwards it to me for disbursement. This process has been commended by several external auditors.

 

Would something similar to this work in Lieu of two party signatures on each check?

 

SemperParatus:

 

Thanks for your suggestion - yes PeachTree is not all that intuitive. I am completely unfamiliar with QuickBooks; is it also double entry?? If it is as simple as Quicken, which I use for my personal financial management, that may well be the way we go.

 

Again, my thanks to all of you. This is indeed a great forum.

 

Bob Hendry

Troop 908

Hughesville, Maryland

[Vicki]

MajorBob, I instituted a less formal way of doing what you describe in our troop (they resisted anything more formal and it's not work so I could compromise). Any expense outside of the routine is OK'ed by either the CC or the SM before I write the check. If I can write the check directly to the outside party (for instance, directly to the provider of the pizza supplies for our fundraiser), so much the better. My next step is to ask the committee to put a policy in place that requires an approval for any expense over $xxx (I haven't decided yet). Then put some of the policies in writing - but I have a while to bring 'em along to that point. We're one of those troops that tends to "elect" people to the same position until they either don't want to do it any more, their kids finish/quit or they lose interest. My youngest is a WebII...

 

As far as the mechanics of the job I use several Excel spreadsheets. We have individual Scout accounts, the bank account and High Adventure treks to track and that's been the easiest way for me to handle it. I just put together a budget for 2005 so I'm figuring out how to track that against the account. I'm looking at Troopmaster - folks tend to like it but I don't know how it is for just the financial part. Pretty sure I couldn't talk anybody into using it for anything else (at least not yet:

[eisely]

Vicki does not say so directly, but having some kind of voucher or payment request form is not a substitute for a dual signature account. I object to forms that I don't consider necessary. What is necessary is some kind of approval process for major expenditures. I share Vicki's enthusiasm for setting a dollar limit for requiring committee approval. I too don't know what that number would be. As Uncle Guinea says, a petty cash fund is also a good way to handle minor scoutmaster outlays without committee approval for every postage stamp.

[Vicki]

I agree with Eisely - I detest unnecessary paperwork (heck, I even detest necessary paperwork:

[MajBob]

Sage advice indeed!

 

What is generally the upper limit on checks before two signatures are required? Also, is $50.00 normally the SM petty cash limit?

 

Just a couple more questions:

 

It is clear to me that as treasurer, my job is to account for and manage the finances for the troop. Does this typically include the Venture Crew? (We are currently a very small troop and a very small Venture Crew; about 10 total kids)

 

And to whom do I report most directly; the SM or the CC?

 

At the last troop meeting, a scout who had been inactive since Christmas came back with a $50.00 deposit for summer camp. We had just sent the first prepayment to the Blue Ridge Mountains Council which was $100.00/scout. The SM then, on Tuesday evening, asked me to write a check for an additional $100.00 to the Blue Ridge Council for the scout who had just rejoined. I will acknowledge that I am a bit 'audit aware', but very daunted I wrote the check for him to mail with nothing in the form of invoice or receipt to back up the transaction. And I am uneasy about it - not that I dont trust the SM - I do, implicitly, but I would be found out of compliance with GAAP if audited; when does the troop get audited?

 

Again, I would like to thank each and every one of you for pitching-in to help the new guy, i.e., me!

 

Bob Hendry

Troop 908

[Vicki]

Bob, the Treasurer function reports to the CC. From a GAAP perspective, that takes you out of any accountability to the SM - a good thing. In the absence of any committee policies, for something routine like a deposit for summer camp, I would have just given the SM a piece of paper to initial requesting the check. In our troop, knowing the SM as well as I do, I would have just noted the scout's name in the memo line of the checkbook. I do keep a separate spreadsheet detailing which scout has paid a deposit, the full amount, got an official campership or a troop scholarship, etc. The other side of the spreadsheet is the payments we make associated with summer camp.

 

GAAP (Generally Accepted Accounting Procedures) is a very flexible framework that simply provides guidance to accountants in performing their job. You really don't have to worry too much about getting audited unless your CO asks for it. That would be a question for the committee. To us accounting types there are very strict definition associated with the word "audit". If what you are actually talking about is members of the committee looking at your work, that's up to the committee and how often/if they want to do it.

 

Our committee meets once a month - if I were you, armed with the info from this thread and your research, I would pose some of these questions to the committee and get some feedback.

 

Vicki

[Vicki]

Obviously shouldn't start typing before the brain is completely engaged - GAAP is Generally Accepted Accounting PRINCIPLES - not PROCEDURES. Whoops.

 

Should also note - knowing the international nature of this forum - GAAP varies from country to country.

 

Vicki

[Prairie_Scouter]

Vicki, having worked in banking for 30, I've come to believe that the General Ledger is the root of all evil in the universe :-) but I digress............

 

MajBob, Just one more troops way of doing things......

We have a dual signature account, but the reality of it is, the treasurer usually asks one of the other signers to sign a few checks each time we meet to avoid logistical problems, Granted, opens a fraud hole, but we've all known each other for years and years, and it's not like emptying our account is going to let someone start a new life in New Zealand or something :-)

 

We do our accounting on a spreadsheet, and while having a single bank account, do divvy up the total among some internal accounts for capital expenses, long term funding, etc. We do have individual internal accounts for each scout to keep track of their credits for fundraising, etc.

 

Awhile back, I tried to find some guidelines on how much money you can carry over from year to year. There doesn't seem to be anything written in stone, but the guidance I've gotten is that it varies from troop to troop based on size and need. Large troops have more long term capital expenses, so they could carry over thousands each year. Smaller troops normally wouldn't have so much, but if they are nearing a high adventure trip, which are usually very expensive, they could have quite a bit in reserve for a short period of time. Seems like you're ok as long as you can justify why the money is being held.

 

We meet each month and go through the treasurer's report at each meeting.

[MajBob]

Dear Vicki,

 

Thank you for you good advice. I am very appreciative.

 

I am also treasurer for a couple of Political Action Committees, and get audited by both the State Board of Elections as well as federal audit agencies, so I am, not so much 'gun shy' as 'audit aware'. So in my ignorance of BSA policy, I tend to go the the extreme.

 

In my former life, I ran an internal audit division in the Army - another reason why I tend to be a stickler . . . ANd I would really like to simplify this to the level necessary - and no more! I will indeed bring what I have gained from this thread to the committee meeting next week.

 

Thanks again to all who have contributed. Cheers!

 

Bob Hendry

Troop 908

[Vicki]

Bob, thank you. Had I realized your level of experience I might have written a little bit differently. I feel your pain, having been through two IRS audits - one of which turned into a "fraud audit" midstream due to events that transpired years before I was brought on board as Controller. Found those skeletons in the closet shortly after I was hired which led to some sleepless nights once we got the audit notice. We averted the fraud part of the program but I liken the experience to what a colonoscopy must be like:

[eisely]

Vicki,

 

I disagree with your colonoscopy analogy. Having worked with clients on IRS audits and having had more than one colonoscopy I think I can respond from true knowledge. The hardest part about the colonoscopy is the preparation. The procedure itself is no big deal and when it is over it is over. As you know, some IRS audits never end. Probably the best part about an IRS audit is that there is nothing you are expected to do to prepare for one other than get your returns in on time. Speaking of which....

 

But I digress.

 

I think the thing that disturbs most people coming into a troop treasurer position with some level of financial/accounting experience is the lack of rules. There are many areas where BSA leaves a lot of flexibility to units. Finances is one of those areas. There is an advantage to this.

 

Having some kind of subcommittee audit or review the accounts annually and/or upon change of treasurers is probably a good idea. I have never seen it done.

 

The story about the kid coming back into the troop reminds me of how I approached this job. My first adult volunteer position was as treasurer for a cub scout pack. The amounts were much smaller and of course the pack and committee met only monthly. What I found was that people would shove odd amounts of currency at me at pack meetings to pay for some activity or whatever. I immediately purchased a receipt book that made copies. When I started handing out receipts some people responded that it was not necessary because they trusted me. My response was that this was not for their benefit but for my benefit. It was the only way I could make sense out of the cash receipts at the end of a pack meeting. The lesson is that there is probably nothing wrong with making the disbursement that scoutmaster requested. Making a note on the check itself and making the check payable to the council, not an individual, is probably sufficient documentation, along with a system of tracking funds paid and disbursed on behalf of the boys generally.

 

With regard to the Venture Crew funds. I would not co mingle funds for separately chartered units. If what you are referring to is a separate group of older boys within a troop, then tracking those funds on a sub account of some kind is both appropriate and sufficient.

[Vicki]

eisely, in the spirit of good fun - on a corporate level, an IRS audit is just like a colonoscopy. You scour all your returns, all your documentation, make sure everything is in order and FIND the stuff that isn't in order and either make it so or begin practicing your mea culpas and/or do damage controls.

 

The examiner arrives.

 

If the audit goes well, it's over, the examiner leaves, prepares the report and sends it to you (analogy is waiting for the test results). If it went well, you go back to your daily grind with the knowledge that they will leave you alone until your number comes up again, if it does. If it doesn't go well, there are endless followup procedures that result in the patient either completely recovering, losing parts of their body or dying.

 

Vicki

 

 

[MajBob]

Dear eisely & Vicki,

 

I agree with eisely - the preparation is the hardest part. I _could_ add that the colonoscopy in more analagous to drinking warm beer, while the audit is like drinking a bottle of Texas Pete - it can continue to frustrate after the fact . . .

 

But I won't go there!

 

Cheers.

 

Bob Hendry

Troop 908

[Vicki]

P_S, I find great comfort in the general ledger - in fact, I've often thought that if I ever got a personalized license plate it would read 0=0.

 

To respond to something you wrote: "We have a dual signature account, but the reality of it is, the treasurer usually asks one of the other signers to sign a few checks each time we meet to avoid logistical problems."

 

My biggest issue here would be the possibility of losing one or more of those checks. The bank will clear anything and the fact that there is one valid signature will raise a question in their minds as to whether or not to make reparation.

 

Also, realistically, if you're going to subvert the process why have that restriction in the first place? My feeling is that there's no point in having a process just to look good - it's supposed to fulfill a purpose.

 

Vicki

[Vicki]

No argument that the preparation is the hardest part...the point of discussion is that the aftermath can be devastating.

 

V