1. Presented by: Sharon Pender Louisiana State PTA Treasurer

2. What is the purpose of a financial audit? What is it? Why is it done? Who does it? When is it done? How is it done? When is it reported?

3. To certify the accuracy of the books and records of the PTA. To assure the membership that the association’s funds are being managed in a business-like manner To protect both the PTA and the officers

4. A financial reconciliation involves following the financial transactions through the records to be sure receipts are properly accounted for and expenditures are made as authorized in the budget, approved by the membership, and conform to PTA policies and procedures.

5. To certify the accuracy of the financial records of the PTA. To assure the membership that PTA policies and procedures were followed. To maintain standards of affiliation as a 501(C)3 and good standing status at the state level. To qualify and maintain fidelity bond coverage. Non-signer review the bank statement monthly 2 people count money before it is counted by the treasurer Conduct a financial audit as required in your bylaws To keep everyone accountable.

6. Article VII: Duties of Officers, Section 4. The treasurer shall: i. submit the books annually or upon change of officer for a compilation by an auditor or auditing committee of not fewer than three (3) members, who, satisfied that the treasurer’s annual report is correct, shall sign a statement of the fact at the end of the report. Not related to a signature on the checking

7. End of the fiscal year (in your bylaws) When a new treasurer is elected or appointed Any time the signature on the bank account changes Any time deemed necessary by the president or if three (3) or more PTA members make a request Louisiana State PTA review

8. The outgoing (or returning) treasurer is responsible for providing the financial records to the audit committee for review. The incoming treasurer picks up the books, reviews the audit report and implements recommended changes.

9. Copy of the previous audit report Checkbook, cancelled checks, voided checks and all unused checks for all accounts Bank statements, deposit receipts and check requests with original receipts attached. Treasurer’s books and ledgers Copies of minutes from general and board meetings

10. Adopted budget and amendments Copy of previous year 990N or 990EZ Copies of all treasurer’s reports for period being reviewed Current approved bylaws and standing rules Any other information requested by the audit committee

11. Outgoing treasurer should no longer write checks Signature cards should be changed Checks should only be written in the case of an emergency and should be signed by the incoming treasurer

12. Once the books have been closed for financial reconciliation, generally within a two week period. The accuracy of the records will determine if it will be necessary for the committee to meet more than once. A location where the committee can meet for a 2-3 hour time period. A private place, where conversation cannot be overheard, is recommended. All information discussed in the audit process is confidential. Only the final written report is made available to the PTA board of directors.

13. Begin by checking the beginning balance against the previous year’s ending balance Make sure each check has back up receipt Verify fundraising dates and deposits Verify that all deposits had two counters, an itemized deposit form was used and signed by counters and treasurer Check all ledger entries back to cancelled checks and deposits Verify bank reconciliations have been done monthly and check their accuracy

14. Verify that a non-signer has reviewed, initialed and dated all bank statements Check the accuracy of the math in the checkbook Verify that treasurer’s reports were given at each meeting and are accurate Confirm that no checks were made out to “Cash” Make sure that funds were dispensed according to the budget Draw a red line across the ledger and checkbook where the audit is concluded, date and initial

15. Irregularity-a breach of rules, customs, etiquette, morality, etc. A consistent disregard for procedures and policies A consistent disregard for handling disbursements and deposits Failing to make proper reports to the board and membership A lack of proper filing of tax documents

16. Contact the treasurer to secure additional records or information. If the matter cannot be settled to the committee’s satisfaction, contact the current president to work out what additional steps need to be taken. The president can request additional guidance from the district or state treasurer. If the audit committee finds irregularities in the records of the treasurer, the following steps should be followed:

17. Reporting “ The Audit Committee has examined the records of the treasurer of _____________ PTA for the period of ____________. The current balance on hand is $_____________. “ “ The following irregularities have been found.” List all irregularities “ The following steps were taken to correct the problems.” List steps “ To prevent these types of problems from occurring in the future, we recommend the following,” List the recommendations

18. A member of the audit committee should make the report to the membership at the first meeting held after the conclusion of the audit. The association should adopt the report at that time. It must be voted on by the membership The report should be maintained permanently by the treasurer and placed in the minutes. In the event a complete audit cannot be done due to the inadequacy or unavailability of the records, this must be reported to the membership. Steps should be recommended for adoption to correct the situation.

19. Treasurer is legally responsible for all the funds of the association. Officers of the association are elected by the membership and have a fiscal responsibility to keep the association on a sound financial basis. Is your PTA incorporated? Is your PTA Insured?

20. Louisiana PTA Treasurer, Treasurer@louisianapta.org Treasurer@louisianapta.org District Treasurer Internal Revenue Service, Irs.gov Louisiana PTA Resource Guide, Treasurer pp.2-42 Online Back to School Kit, http://www.ptakit.org/Finance/The-PTA- Audit/Overview.aspx