Financial Management

Banking Information:

Registered student organizations should utilize the following guidelines when managing their accounts: 

  • Each AU Student Organization must establish a checking account if the organization is collecting income such as dues.
  • The account must be in the student organization’s name. Student organizations are not permitted to use Auburn University in the name of their account.
  • Each AU Student Organization that has a checking account must have at least two names on the account, preferably the Advisor and President or Treasurer. If the Advisor is not listed on the account, he/she must be authorized to receive a monthly bank statement.
  • Student organizations must update the signature authority list often as organization officers and advisors change.

The Office of Student Involvement reserves the right to request an audit of any student organization’s financial records. In addition to these requirements, Student Involvement offers the following guidelines to assist your organization in adhering to sound financial practices.

 

Handling Cash:

Anytime a student organization is handling cash, it is important that certain precautions should be taken. This will not only assist in protecting the cash collected but also the individuals responsible for handling money. Below are tips to consider when handling cash. 

  • The organization should utilize income receipts for all funds received. The receipts should be used in sequential order. The organization should perform a reconciliation of income receipts for completeness.
  • The organization should perform reconciliation between the items sold and the funds received. (This should also be performed for application fees received.)
  • All checks received should be made payable to the organization and be restrictively endorsed upon receipt.
  • All funds should be properly safeguarded between deposits (i.e. in limited access areas, safe).
  • All income should be deposited on the same business day or secured in a locked safe/cabinet and deposited on the next business day.
  • Do not leave cash boxes unattended. If carrying a large amount of cash, the student organization must have security present.

 

Checking/Debit Cards

  • Many student organizations choose to utilize Checking Cards in place of physical checks.
  • It is important to ensure that only authorized users have access to the card.
  • Receipts from every transaction should be kept and made available for officers or the advisor to review.
  • Most checking cards come with online banking.
  • Online banking allows for easy access to transactions.
  • Online banking can be a great tool to monitor all transactions and assist the treasurer in maintaining a balanced budget.

 

Role of Treasurer:

  • The organization treasurer is responsible for helping the organization develop a budget monitor spending, and manage all financial transactions for the organization.
  • Treasurers should prepare financial plans, budgets, and utilize the budget as a management tool. Budgets should be established annually and monitored at least monthly. There are three primary purposes for developing a budget:
    • To put the group’s plans into monetary terms
    • To provide a means of allocating limited resources among the organization’s activities
  • To track the organization’s actual revenues and expenditures against its goals
  • Treasurers should provide members of the budget status on a regular basis (balance, expenditures, anticipated expenses, etc.) Preferably, updates should be provided each semester.
  • Treasurers should update all accounts on a monthly basis.
  • Store and maintain account information (account number, passwords, etc.) in a confidential location.

 

Developing a Budget:

  • If your organization has been in operation for a fair amount of time, the easiest way to prepare a budget is to start by recording your last two or three years of actual financial data by year. A schedule thus prepared will allow you to compare trends and identify major expense centers. It will also point out areas where your group is growing or declining and indicate areas where reductions and cost savings might be possible. This historical information can then be used as a basis for preparing a current year budget forecast. The budget forecast is adjusted and modified from the historical data for projected major changes in revenues, programs, or expenditures.
  • Obtain historical data from your organization’s records to assist you in this process. If your organization does not have these records, begin creating a system now that can be used in the future.

 

Accepting Credit Cards on Campus

Department Sponsored Organizations

  • Organizations within a Departments or units must contact the Office of Cash Management to begin the process of accepting credit cards or to modify an existing merchant account.
  • Any department or unit accepting credit cards on behalf of the Auburn University System or a foundation associated with Auburn University must designate an individual within the department who will have primary authority and responsibility within that department for credit card transactions.

For more information, please visit Cardholder Data Environment Credit Card Acceptance Policy.

Others

  • Organizations that are not a part of a department budget (most student organizations) should ensure that secure systems are utilized when accepting credit cards.
  • It is important to protect the data of those who conduct business with the organization. Therefore, it is not recommended that student organizations use 3rd Party vendors such as PayPal, Square, Venmo, etc. Like any other financial transaction, student organizations are not accepting cash, check, or credit cards on behalf of Auburn University and will accept responsibility for any breach of data.

 

Fundraising:

  • Many student organizations choose to raise additional funds for trips, operations, and philanthropies through fundraisers.
  • Many fundraisers may be conducted on campus. Anytime an organization is fundraising, it is important to be clear that funds will benefit the student organization NOT Auburn University.
  • If food will be provided, it must be catered and not personally prepared by the organization.
  • Student athletes may be prohibited from participating in fundraisers and raffles. . Please contact the university’s athletic compliance office for guidance.
  • Only certain entities are designated by the IRS as entitled to receive tax-deductible charitable contributions. Notify companies donating to student organization that they are not eligible for a tax deduction unless the organization has tax exempt status

For more information or questions about fundraisers on campus, please contact Debbie Hood at 334-844-1300

 

Organizations Fund:

 The Organizations Fund is available to permanent status student organizations each year from the Organizations Board. The Organizations Fund is granted to student organizations through the Student Government Association Code of Laws.

  • Before an organization can receive funding, they must present Student Involvement with a Tax ID Number and proof of the expenses.
  • Organizations must be able to purchase all approved expenses up front and will only be reimbursed for the amount of money spent on approved expenses. Pre-approval of expenses may be obtained by the Organizations Board.
  • The Organizations Board provides all student organizations with a list of Funding Guidelines they must follow. Completed applications must be turned in to AUinvolve. A representative of the organization will be invited to the Organizations Fund Hearing where the Student Organizations Board will review the request. The representative will be given the opportunity to explain the request and answer any questions the Student Organizations Board may have.

 

Tax Information

THIS DOCUMENT IS FOR EDUCATIONAL PURPOSES ONLY. EACH LEGAL SITUATION IS VERY FACT SPECIFIC AND UNIQUE TO EACH INDIVIDUAL ORGANIZATION. THUS, WHILE THIS DOCUMENT WAS PREPARED BY AN ATTORNEY, THE ACCURACY OF THE INFORMATION AND THE PROCESS IS NOT WARRANTED. THIS DOCUMENT SHOULD BE CONSIDERED A GUIDE AND SHOULD NOT BE CONSIDERED A SUBSTITUTE FOR ACTUAL, ONE-ON-ONE LEGAL ADVICE. FOR ACTUAL LEGAL ADVICE, YOUR ORGANIZATION SHOULD CONTACT AN ATTORNEY.

Employer Identification Number
Any student organization collecting dues or income of any type are required to have a bank account. In order to set up your bank account, you must apply for an Employer Identification Number (EIN) from the Internal Revenue Service (IRS). The EIN application is located on the SS-4 form. You may apply through the following links:

Non-Profit Organization
Some student organizations choose to apply for federal income tax exempt status through the IRS. The most common type is a 501(c)3. The non-profit process is time consuming and does require additional fees for application. Organizations wishing to apply for non-profit status may find more information on the IRS website.

Filing Taxes
For organizations not classified as non-profit, it is important to ensure your organization is filing taxes as appropriately outlined by the IRS. If the student organization reports less than $5,000 on their “gross receipt”, regardless of the organization’s classification, it will automatically be considered federal income tax-exempt and will not need to file annually with the IRS. A “gross receipt” is defined by the IRS as “the total amounts the organization received from all sources during its annual accounting period.” Note that this number is calculated before subtracting any costs or expenses. Also note that this number includes student activity fee money, donations later re-donated to a charity, dues collected from members, etc. Thus, most forms of money taken in by the organization count against this $5,000 limit.

 

  • If a Student Organization receives $5,000 or more during an annual accounting period, it should contact the IRS to determine which form to file on behalf of the organization.
  • If you would like more information about taxes, please see our “Student Organization Tax FAQs“.

 

Spending:

Student organizations should use organization funds for business purposes only. No alcohol, weapons, or illegal substances should be purchased with organization funds

 

Securing a Bank:

In identifying a bank to utilize for the student organization’s account, groups should consider if the bank:

  • Has a local branch
  • Allows organization to change signature authority with relative ease
  • Allows organization to cap spending limits if they so choose
  • Prohibits use of debit card for cash advances
  • Is transparent about use of fees

Permits use of physical checks if the organization wishes to utilize.

Last modified: September 24, 2020