Aside from the obvious reasons stated above, if you are a 501c3 organization, there are the IRS rules on recordkeeping. They require that you keep books and records (although they allow the type of records to be defined by the organization's structure-i.e. your mission etc,) in order to show that they comply with their rules. You need to have documented the sources of your receipts (minutes can show that an expenditure for the playground was approved in July 2001) etc. The most common timeframe for maintaining these records is three years but specific items and assets may require that you keep them longer. Other items are to be kept permanently. Things like your 501c3 application, your determination letter recognizing your exempt status, articles of incorporation and bylaws, plus ammendments.
You can get this information from the IRS publications 4221 and 557.
Also, your insurance company may have it's own guidelines about how long you should keep records. Contact them directly to get their timeline.
As usual, Critter, you hit the nail on the head. Some of you guys are so good at writing your thoughts down! Everything you said is right on the money! DO NOT DESTROY THE RECORDS! They are valuable and do have merit.
I am constantly amazed by the seemingly pervasive notion that every idea has to be new; that old ideas lack merit and that new leaders have to put their personal stamp on everything. So much time is lost and mistakes are made when we completely ignore the past (remember what Ben Franklin said). Is it a pride thing (only our own ideas are worthy)? Or a lack of confidence (nobody would want this old stuff...). Let the new officers go through the old files. Let them decide what they find valuable and what is really redundant or extraneous.
That is so absolutely true. I am seeing a lot on these forums of bashing the old and EVERYTHHING in the past is irrelevant and not good anymore. Those records are gold if you take the time to go over them this summer and see what's what.
Don't let them destroy the files! There is valuable information in there, even if you don't think of it from a financial perspective. Notes and samples of ideas that were tried, or discussed and not tried, lists of people who volunteered, names and addresses of suppliers/vendors, and no doubt more. After two years, why would they think they created nothing of value??
I am constantly amazed by the seemingly pervasive notion that every idea has to be new; that old ideas lack merit and that new leaders have to put their personal stamp on everything. So much time is lost and mistakes are made when we completely ignore the past (remember what Ben Franklin said). Is it a pride thing (only our own ideas are worthy)? Or a lack of confidence (nobody would want this old stuff...). Let the new officers go through the old files. Let them decide what they find valuable and what is really redundant or extraneous.
And don't destroy financial records like treasurer reports, bank statements, and cancelled checks for at least 3-4 years. They can be very valuable for future planning.
As far as auditing goes...our PTO existed for over 15 years before we set up our first financial review. We had no reason to suspect any impropriety in the past, so we reviewed only the current year for our first "audit". Since then, we've found a volunteer parent to review our files for the just completed year in July.
I keep our records, even though we raise such a small amount we don't have to even file a tax return. It is good, if for nothing else, to review what you did before, how it worked, etc. If you don't have a history, you tend to rethink/redo things and tend to make the same mistakes. Not to mention our memories are not that good when you wonder how that fundraiser 3 years ago went (we all remember it different).
We will have a new board this year. The old board Pres. and VP want to destroy all the records that they had over the last two years, with the last year having several questions that evasive answers were given. :confused: What is the rule for record retention and passing on the books and old check book/stubs. Also if the books are audited don't we need those records. It has been 7 years since the school opened and the books have never been audited.
