My Tip of the Week: Protect Your Finances
OK, guys, time for my annual plea -- please, please take these simple steps to protect your finances.
OK,
guy
guys, time for my annual plea -- please, please take these simple steps to protect your finances:
Just this month, there has been another flurry of embezzlement stories from school parent groups. A PTA treasurer in California admitted she stole $35,000. And in Kentucky, a PTO president was charged with taking $10,000. We've seen dozens of these every year since PTO Today started in 1999.
The key to keeping your group out of these headlines is to make it much more likely that a misdeed will be noticed. The typical culprit in these crimes is a very normal volunteer, often in financial stress, who notices how easy it would be to "borrow" some funds for a while. I can't recall a single embezzle case (or a big loss) in a group that followed the above steps.
Final plea: If you're a treasurer, will you please make instituting these steps your job? Sometimes leaders worry they'll be insulting their treasurer if they ask about these matters. You can solve that easily by taking on the task yourself. (And consider adding a few more easy-to-follow finance best practices while you're at it.)
Has your group struggled with this issue? Or put some good controls in place? Would love it if you'd share your feedback and experience on our message boards.
- Make a rule that someone besides your treasurer receives and opens the bank statement each month. Temptation is much greater if a financially struggling treasurer knows she can write a check to cash and then just rip it up when it comes back from the bank.
- Have an audit committee that will review the books at least once per year. (It can be all volunteers; doesn't need to be accountants.)
- Get bonding insurance. It's cheap, it provides real protection, and it's worth it.
Just this month, there has been another flurry of embezzlement stories from school parent groups. A PTA treasurer in California admitted she stole $35,000. And in Kentucky, a PTO president was charged with taking $10,000. We've seen dozens of these every year since PTO Today started in 1999.
The key to keeping your group out of these headlines is to make it much more likely that a misdeed will be noticed. The typical culprit in these crimes is a very normal volunteer, often in financial stress, who notices how easy it would be to "borrow" some funds for a while. I can't recall a single embezzle case (or a big loss) in a group that followed the above steps.
Final plea: If you're a treasurer, will you please make instituting these steps your job? Sometimes leaders worry they'll be insulting their treasurer if they ask about these matters. You can solve that easily by taking on the task yourself. (And consider adding a few more easy-to-follow finance best practices while you're at it.)
Has your group struggled with this issue? Or put some good controls in place? Would love it if you'd share your feedback and experience on our message boards.
