When I took over as treasurer, our principal (who was only in his second year as a principal) said we should carry over several thousand dollars "just in case". I analyzed the check registers for August and Sept for a couple of past years and proved that our incoming cash flow (dues and fundraising) far outpaced our outgoing cash in those months. When I showed him the numbers, he realized there was no "in case" and had no concerns about the PTO spending down its balance a bit more. Of course, if we were saving for a specific captial improvement, that would be a different story.
Would be interesting for you to ask your treasurer why he/she thinks you can only carry over a couple of thousand. I suppose it's possible that someone wrote some sort of provision in your bylaws that would prohibit any large carryovers, but that's probably the only place you might see something like that in writing.
There is this persistent myth out there that "nonprofits" can't have a profit--they must spend pretty much everything they take in every year, either within that year or maybe within the next. Not sure where that came from, 'cause it just ain't so.... Like Tim said, check some other threads on here, but you'll see where this has been explained before. I seem to recall JHB taking part in a good discussion on this a few months back.
I have one nagging question.Our PTO is tax exempt. Is there a certin amount of money that can be carried over each year or can we raise as much as we need and set it aside for items and events we may need or have in the future? I keep getting the same response that our treasure keeps telling us wich is we can only carrie over a coupple thousand. I have also heard that we can have as much as we want. Help!!!!
