One of the best lines I ever heard from an expert on PTO finances:
TRUST IS NOT A SAFEGUARD
The volunteer you trust today could be tempted or replaced tomorrow. On the surface, financial controls sound like that could strain relationships ("you dont' trust me?", but they actually preserve relationships by taking the relationship out of the business of running the PTO.
Two signatures, no matter what, no matter how small the check. When everyone understands the policy, and realizes it will be applied consistently, no matter who is involved, everyone learns to deal with the policy.
Yea, I'm a stickler on this point. To me, it's the Exec Board's responsibility to do EVERYTHING they can to preserve the integrity of the PTO's finances. It's a matter of assessing the risk and deciding how much you and your members are willing to live with....and openly discussing the procedures you'll put in place in case you get burned.
I would never go with anyone other than current board members and possibly, the principal as signatories.
We have to have two signatures from Pres, V.P., Secr or Treas.
The Pres and I-secr, make probably 90% of the check requests. There are times I can go weeks without seeing board members other than the treasurer since we are both in the school five days a week. There have been many times that I have been the second signature on a check made out to me. I understand how that could be problematic but I do trust myself.
We can't just go buy something and then get reimbursed. We never buy anything off the budget and do have to have a request form approved by one board member.
Jim--I'm glad that is working for you -- and we too don't have 2 signatures required but we do separate the signature authority from the checkbook holder. Our treasurer holds all the checks and she writes them and then meets with me (primary) or the VP (in case I break my neck or something) for signature. It is very much the same thing as 2 signatures in a sense....but is what I believe a sound approach to fiscal responsibility. I've long been an advocate of trusting my board, however I believe that the policy of not writing and signing the checks protects the treasurer as well as the PTO. There is no question come audit time, that I was aware of the purchase request and that as President had approved the disbursement of money. That puts the onus of the disbursement and responsbility for it's approval on my shoulders and not my treasurers. That way she cannot get waylaid in the hallways by someone with a receipt, make a disbursement that may not have been approved and then we all go "huh"? It can be a pain, but the sense of knowing what's going on with probably the most important aspect of the PTO's business (the disbursement of our money) is what I get paid to do.
Now it is true if someone wanted to rip off the PTO without any regard as to the consequences of the outcomes, they could do that. But as I see the bank account dwindling (the bank statement comes to the school where I have first view) and I know that I have not signed any checks, well then forgery can now get added to the misapporiation of funds charge.
Again--I trust my treasurer completely (she even watches my children on occassion), but the approach is one of the two man rule as far as oversight, and is in place for a time when my t and I are long gone.
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The only question that I would have, and your Bylaws may specifically require it, is whether or not the dual signature is needed. I know that it can prevent bad things from happening, but hopefully you would have trustworthy people voted into the offices so it would not be a factor.
In my group the checks only require one signature. The treasurer, Assistant Treasurer and the President (myself) all have check signing authority. Personally I don't believe that this is an issue as the three of us provide checks and balances for each other. If I signa check for a purpose it is my responsibility to contact (usually by e-mail the treasurer with the fact that I did so and for what purpose. I also need to provide the collected proof of purchase to the Treasurer for book keeping. If someone ends up purchasing a bunch of items for the upcoming Holiday Gift Shoppe I don't see why I shouldn't be able, or one of the Treasurers shouldn't be able to provide them a check for that purchase, as long as they have the receipt. The idea of having to obtain two signatures seems like an awful waste of time and resources.
Hopefully a non-trustworthy person would not be voted into this position. I know that that is difficult to ensure, but for the most part I would imagine that the avergae Treasurer or President are trustworthy. Having the President, along with two others on the account should provide the required checks and balances. Requiring two signatures shouldn't be needed.
I know, some of you are thinking that one might be non-trustworthy and take advantage, but at the same time if there was someone of that nature that wanted to do this anyway they would just forge the others name.
The point is that the dual signature requirement seems, at least to me, a nuisance more than anything. As long as you have the checks and balances in place to ensure that something innappropriate would be caught quickly, that should be enough. Of course this is IMO and the Bylaws would be the ultimate authority, unless changed.
The parent groups I belong to are the same as yours-require only one signature. The two signature rule would be best, but it is nearly impossible to coordinate two people meeting to sign checks. We have strict reimbursement policies, forms that must be completed for any financial transactions, and a very clear budget. The treasurer provides a detailed financial report at each meeting, audits are performed annually, and other officers are on the signature card so they can contact the bank to get info if needed. Monthly statements are also available for review by officers.
As for the credit card, our elementary group had a debit card held by the President that was used to make large purchases for events, when the treasurer couldn't do it. We decided to try this out to help with committee chairs who were uncomfortable spending large sums of their own money and waiting for reimbursement. We felt is wasn't fair to expect that of them and that the issue could affect someone's decision to volunteer for those positions. We used a form for any transaction in relation to the card and the receipt had to be attached. I could see that the credit card might be a bit better, because you would have the opportunity to dispute any inappropriate transaction made. I'd really limit who has access to the card and establish some firm policies for its use.
We are currently discussing the 2 signature issue to some degree. I agree with the 2 signature requirement in theory, however, for an organization like ours that for most expenditures is quick trips to pick up things and all it is not an easy thing to comply with the 2 signature. We do not feel like it is fair to ask a person to sign checks in advance so the other person can go do whatever. Basically that makes the 2 signature thing ineffective. The way we handle it is the treasurer is completely responsible for the checking account. We have more than her on the signature card and if necessary someone can have access to the account, but the treasurer is responsible. We feel this works best for the way our organization operates. There aren't many things that we have no bill for to sit down and write out checks. We may have to make a run to Walmart or Sam's to get items for an event and no one would be available to sign a check. We are a small school and don't operate on a large budget or anything, but we feel like this works best for our situation. It is a hard call. In other words, we don't require 2 signatures, but handle the disbursement requirements in the by-laws. We have a form for reimbursements, a copy of the checking account statements are kept at school readily available for the other officers to view at any time. We feel like if someone is going to "take off" with the funds then 2 signatures won't stop them. It is a trust issue. Now like I said, if the situation is best handled with the 2 signatures, I agree with it. We are considering getting a credit card with a $300-$500 limit on it to be able to purchase needed items, then pay for them with a check. Has anybody done this and would you recommend it? Thank you.
