I'm all for being cognizant of feelings in this case, but after several adult discussions -- enough is enough. One more chance to follow the directions of the membership and the board, and -- if she doesn't comply -- have the president go down to the bank, close the account and start anew with current treasurer having no access to books.
Doesn't mean she's stealing, but she's clearly not doing her job if she refuses to comply with a perfectly fair request of your membership.
First step -- get current financial management out of her hands (she's not doing her job). After that -- try to figure out last year, if you want to.
I'd recommend doing these steps in as professional, non-accusatory manner as you can.
Cellular...thanks for clearing things up. It's really helping me to understand the problems you're having. The current Treasurer, tho friends with the prior Treasurer, is arguing a mute point. You're right in stating that it's a good business practice. Have her do some research on WorldCom and find out what happened to them for having shady accounting practices. Is your group required to file informational reports with the IRS?? Are you a 501c3 organization?? If so, you could be even more succeptable to an IRS audit. Having a deposit of $8k would tell us you should be 501c3. Depending on the circumstances, you may be required to file informational returns. With the way things are going, your Treasurer may be setting your group up for trouble in the future. With your bylaws not providing any information on termination, you'll have to find other avenues to address this. There's obviously something wrong if the Treasurer is offended by an audit. Does anyone in the group know a CPA?? Have them ask that person if they would do an unofficial audit of your records. You are allowed to pay them for their services but you'd have to look at the IRS rules governing the amounts. If the Treasurer is not willing to work with the group and within the guidelines of your bylaws, you may have to take legal action as your bylaws don't say anything about termination.
Please keep us posted and let us know how things are going.
Jeff This email address is being protected from spambots. You need JavaScript enabled to view it.
Let me back up a minute:
It was last years treasurer that did not keep accurate records. She is friends with this years treasurer, whom along with last years treasurer and the principal did not want us to do the required audit. This years treasurer is keeping records and finally was able to give us a report (24 pages). It is because of that report that we were able to find out that this years treasurer spent almost $2000.00 over the budget. We had only bank statements prior to that and found out we had $8000.00 deposited in our account during the two months after school was out. When we questioned that along with the Secret Santa budget our present treasurer told us the $8000.00 was from a fund raiser done the previos year and that the treasurer just didn't get around to making the deposits. We thought it was odd to have that much money deposited at the exact time we were requesting the audit. She did show copies of checks deposited from the bank, it included checks from as early as March that were deposited in June and July. This was during a heated moment and no one sat there and added it all up at the time.
The Presidents wanted to close the account all together at the beginning of the year and start new, get everything cleared and go from there since we were not to do an audit but again this treasurer refused to close the account. She is very defensive of last years treasurer lack of records and continues to think she herself has done nothing wrong for spending unauthorized money and refusing to do what the Presidents ask: close account, two signers, spending what she wants, and she also does not think we should have an audit done on her books at the end of the year even though it is in our bylaws, which she has refused to read. She says that we are personally attacking her by doing an audit. We tried to explain to her that it protects her as well as letting next years board know exactly where we are, that it is a responsible way to run any business. It's just an inhouse audit, not the IRS, She just doesnt' get it. Thanks for our your posts. I think I might just take this in and let her read it.
Thank you all for you post!
I have to agree about the bank thing. If the bank can't enforce the "two signature" then you should find another bank. We looked into the possibility of getting a bank card since most companies prefer to deal in plastic now and we couldn't because our account requires two signatures for any expenditures. It can be done.....the bank just doesn't want the added responsibility of ensuring that all of your group checks have two signatures. You should find a bank that will.
On the audit....you won't get a 100% audit but you can get a good idea of what other activities have been taking place. Get copies of all the bank statements and work from their. You won't be able to "balance the checkbook" but once you're done, you'll know where your group is at. Then you can get a new Treasurer and move forward. In addition to all the other suggestions that have been made, require a detailed transaction report at every meeting. It's the boards responsibility to ensure the group is kept up-to-date on it's current financial situation.
By-laws: as mentioned earlier, make some changes to add specifics about termination. Once it's in writing, then all you have to do is enforce it.
You may have to work with what you have, i.e. the bank statements. First reconcile your checkbook with the statements for as far back as they go. Then go through the statements and look at to whom the checks were made out. With some help from people who coordinated your various events you may be able to get a pretty good idea of what expenses and deposits go with what event. It won't give you all the information you want, but it may at least give you a basic idea of what each event made.
Then get a new treasurer and write some more specific by-laws. If you are operating as a 501(c)3 non-profit organization, you need to have better accounting. Just think what could happen if the IRS started asking questions.
