The Booster Club Treasurer's Guide: Controls, Calendar and the Handover

Booster club treasurer is a volunteer position with the responsibilities of a finance officer and none of the training. Most people take it on because they were in the room, inherit a shoebox and a bank login, and discover in March that the organization has a federal filing obligation nobody mentioned. This is the guide we wish existed for that person.

Your first thirty days

Before you touch a spreadsheet, get hold of these. If any are missing, that is your first project, and finding out now is much better than finding out during a sponsor's due diligence.

1. The EIN. The club's federal employer identification number. Without it there is no bank account and no filing.
2. The IRS determination letter. The letter granting 501(c)(3) status. Sponsors and grantmakers will ask for it. If nobody can find it, check the club's name in the IRS tax-exempt organization search.
3. The last three years of filings. Form 990, 990-EZ or 990-N. Three consecutive missed years is the threshold that triggers automatic revocation, so this is the first thing to verify.
4. Bank access and the signatory list. Get yourself added and get departed officers removed. A former treasurer who still has access is the most common finding in booster club problems.
5. The bylaws. They will say things about spending limits, quorum and who may authorise what. You are now bound by them.
6. The current budget, as approved by the board.
7. Insurance certificates. General liability, and directors and officers cover if the club carries it.
8. Any state registration. Many states require charities that solicit donations to register separately from the federal exemption, usually with the Attorney General or Secretary of State.
9. Any active vendor agreements. Concession contracts, apparel agreements, payment processors, including the auto-renewal dates. If the club runs a merchandise store, the terms worth checking are set out in how a spirit wear fundraiser works.

The six controls that matter

Booster clubs handle real money with volunteer staffing and constant turnover. That combination is exactly the environment where problems occur, and the controls below exist as much to protect the honest treasurer as to prevent the dishonest one. Being the only person who can move money is a bad position to be in even when — especially when — nothing is wrong.

1. 1. Two signatures on every disbursement

   Two unrelated officers, on every check and every transfer above a small threshold set in the bylaws. No single person should be able to move club funds alone.

2. 2. Separate the person who handles money from the person who records it

   The classic control. If the same volunteer takes the cash, banks it and writes the ledger entry, no error or misuse is detectable from the records.

3. 3. Count cash in pairs, on site

   Two people count, both sign the tally sheet, and it is banked promptly. This applies to gate, concessions and every event where cash appears.

4. 4. Reconcile the bank statement monthly

   Every month, against the ledger, by the treasurer, with the reconciliation reviewed by someone else, usually the president. Monthly reconciliation is what turns a year-end panic into a routine.

5. 5. No reimbursement without a receipt and a purpose

   Receipt, date, amount and a one-line statement of what club purpose it served. This is what substantiates the club's spending if it is ever questioned.

6. 6. Report to the board every meeting

   A short written report: opening balance, income, expenses, closing balance, and any variance against budget. Minuted. This is the record that protects you personally.

The monthly rhythm

• Download and file the bank statement.
• Reconcile against the ledger, and investigate anything that does not match before moving on.
• Process reimbursements. Batch them rather than paying ad hoc.
• Update the budget-versus-actual figures.
• Write the board report.
• File receipts and deposit slips, digitally if at all possible.

An hour a month done properly is dramatically less work than a weekend in June reconstructing a year from a carrier bag.

The annual calendar

The federal filing deadline is the 15th day of the fifth month after the close of the club's tax year: 15 May for a club whose year ends 31 December. The IRS sets this out on its Form 990-N page, and there is more detail in our guide to booster club tax filing.

The mistake that costs clubs their exemption

If you read one section of this post, make it this one. It is the single most common serious problem in booster club finances, and it does not look like a problem at all.

The practice is called cooperative fundraising, and the accounts are called individual fundraising accounts. A family works the concession stand or sells fifty raffle books, and the club credits their athlete's travel fee or dues. Everyone involved thinks this is fair: the people who did the work get the benefit.

The IRS does not see it as fundraising for a charitable purpose. It sees benefit flowing to specific individuals in proportion to their own effort, which is private benefit or inurement and is incompatible with 501(c)(3) status. Parent Booster USA's guidance on cooperative fundraising and IFAs walks through how the IRS and the tax courts have treated it.

What clubs can do instead: raise money into the general fund, and separately operate a needs-based assistance policy that the board applies without reference to who raised what. The distinction is that the benefit is allocated on need by the organization, not earned by the individual.

Cash at events

Gate and concessions are where clubs lose money without anyone doing anything wrong.

• Issue a counted float and record it. Reconcile against it at the end.
• Use numbered tickets or a register so expected takings can be compared to actual.
• Two people count, both sign, on site, before the money leaves.
• Bank promptly. Cash in a volunteer's house over a weekend is a problem waiting for a name.
• Take card payments where you can. A card reader is a control as much as a convenience, because it creates a record you did not have to write.

What to keep, and for how long

• Permanently: the determination letter, EIN documentation, bylaws and amendments, board minutes, and filed returns.
• At least seven years: bank statements, reconciliations, receipts, invoices, deposit records and contracts.
• Digitally, in a place the club owns. Not a personal drive, not a personal email account. Every club that lost its records lost them because they were on the last treasurer's laptop.

The handover

Your last act is the one that determines whether the next treasurer starts on solid ground. Prepare a single file containing everything in the thirty-day list above, plus the current ledger, the reconciliations, the login inventory, and a short written note of anything unresolved. Then physically walk the new treasurer through it, and get yourself removed from the bank account on the same day.

Treasurer questions

What does a booster club treasurer actually do?

Maintain the ledger, reconcile the bank account monthly, process reimbursements against receipts, report to the board at every meeting, track the budget, ensure the annual federal information return is filed, handle any state charitable registration, and prepare a clean handover at the end of the term.

Do booster clubs need two signatures on checks?

It is not a universal legal requirement, but it is standard practice and most bylaws require it. Dual authorization protects the treasurer as much as the club. No volunteer should be in a position where they alone can move funds, because that makes every discrepancy personal.

Can a booster club credit fundraising proceeds to individual families?

This practice, known as cooperative fundraising or individual fundraising accounts, has been treated by the IRS and the tax courts as private benefit to individuals rather than charitable activity, and it can jeopardise a club's 501(c)(3) status. Clubs that want to help specific families should use a needs-based assistance policy applied by the board instead.

How long should a booster club keep financial records?

Keep governing documents, the determination letter, board minutes and filed returns permanently. Keep bank statements, receipts, reconciliations and contracts for at least seven years. Store everything somewhere the club controls, not on an officer's personal account.

What happens if a booster club misses a year of filing?

One missed year is recoverable, but three consecutive missed years results in automatic revocation of tax-exempt status under federal law. If a year has been missed, address it immediately rather than waiting for the next deadline.