Thank you for your replies. We've decided to keep the money donated within the same fiscal year. We will rely on written committments from the corporations to credit the donor accordingly for the donation drive. If for some reason the money doesn't come in, we'll make the adjustments for next year. So far, we haven't had any discrepancies.

We are a small school of less than 300 students. The direct donation fundraiser is the only way we can meet our budget, unless we have 7 product sales!! The sucess of this fundraiser determines wether we do a spring product sale.

Thanks again for your advice.

I would say they get it in the same year. They do get a tax write off for this.And it goes in the same year.
May I ask do you have a fundraiser where you sell things. We make up to 10,000 a year. We have a poor school and about 800 children for k---5, but that is enough a year. Our top sellers are from each grade. We do walmart 50.00 gift cert. I have a great fundraiser if you want it.
GOOD LUCK!

I don't know that this would qualify as "expert" advice (keep in mind how much you're paying for it! ), but here goes....

The short answer is that since you're talking about the rules for an incentive that you're giving, and not necessarily how you record this money on your books, you can pretty much make up your own rules. It's more a question of fairness and ease of administration than what's legal or not. (OK, maybe what you're trying to do is considered to be like a raffle in your state, and maybe that's regulated by your local gaming laws, but that's outside the scope of this....)

My opinion is that the easiest way to do something like this is to give the incentive based on money recorded during this fiscal year--not by mixing and matching some stuff from this year with stuff from last year.

So, if you're following the accrual system of accounting and generally accepted accounting principles, once you get these commitments to pay from different corporations, you should be recording the donations when you get the commitment, not when you receive the $$ (there are some exceptions, but I'm trying to keep this simple). Assuming that you have a fiscal year that roughly corresponds to your school year, and this is a school year campaign, then only things related to this school year should be included in the incentive. (Example: Family writes check for $300 in September. In November they give you a letter that says you'll get a matching $300 from their employer, but it won't come until May. You would credit them with $600 for purposes of the incentive.) That way, it will match with the revenue you're recording in your financial statements. It sounds like what your treasurer is proposing is just way too complicated.

The other way of doing it is to base it on what cash comes in during a certain set time--regardless of what year it is for. I don't know if you have payment plans set up to let people contribute throughout the year, or what. But, if you want to encourage them to pay earlier, for example, you could say that you're going to include all cash received from x day to y day--again, regardless of the year pledged--for purposes of the incentive. Bottom line, though, is that you want to be consistent.

Another issue--if people know you are including corporate contributions in this, doesn't that automatically disincentivize the parents who don't have that option? Maybe you could consider two different levels of incentives--one for people without the ability to get matching corporate donations, and one with.

[ 09-13-2004, 01:39 AM: Message edited by: mum24kids ]

I'm in a heated discusstion with our treasurer about this one, I hope someone can help resolve the issue.

This is the second year our school has asked the parents for a direct financial donation for our major fundraiser. The first year was succefull but thought if we changed a few incentives, it would be even better. One incentive would reward our top five donors. This is where it gets confusing. Our top 5 donors would most likely include the 3 or 4 students that have families that donated through their work. It is mandatory for these parents to donate to a non-profit org., so they have chosen our/their school to donate to. The donations range from $500 - $1500 a year and does not start coming in until about Feb. but we still be a financial statement from the company indicating the amount the donor will be donating. Now, we only ask for $175- $300. from each student in the whole school. This is an example of our situation: We asked for a donation of $175.00 last year. We received $1000.00 from a family that has a company donation. Our treasure wants to subtract the $175.00 from last year and "credit them the $825.00 for this year. Or give them the option to credit any amount and carry the rest throughout the years. My opionion, as PTO pres. is that we can not credit any donations throughout the year for tax purposes. I think many other problems can arise from doing this. Is it legal/illegal? Since we get a comittement from the companies on the dollar figure, why can we say, ok, Mary Janes' company will be donating $1000.00 this year, even though we will not be receiving it in full until May, we will still give her the credit as one of our top 5 donors. Our treasure is concerned something may happen, maybe Mary Jane leaves the company and we only get $500.00. I think it's a chance we need to take rather than to start crediting money. Our treasurer thinks I am punishing and discourageing these families from donating through their company. Am I? Our resolution was to consult with expert advice. I hope someone can help or direct me to someone that can!!!