Planning for Excellence 2012 Treasurer Planning for Excellence Budget & Finance Jo Ann Stevens 1996 Texas President jas3610@aol.com 713-829-1827 Sharon Morton 2012 Texas Treasurer sharon@sharonmorton.com 832-524-6530 Mission Statement: We are a network of successful REALTORS® empowering women to exercise their potential as entrepreneurs and industry leaders.

Planning For

Planning For Excellence Dollars & Sense Treasurer Duties Chapter Budgets Audits and Reserve Accounts Legal Issues (IRS/Insurance) Ways & Means 3

So…now YOU are the Treasurer Work with Governing Board to develop annual budget Use 2011 Budget & YTD info as guide Use LPPM as a guide (pages 31, 41-43, and 127-134) Have your Budget in place by Jan 1st 2012! Cannot make 2012 payments until you have an APPROVED BUDGET! PARTICIPATE on your Chapter’s Budget Committee Participate on your Chapter’s Ways & Means Committee, reviewing & monitoring Event Budgets

Duties of the Treasurer see page 31 LPPM Treasurer is in charge of all funds and makes disbursements/reimbursements as directed by the President AND THE Governing Board. Keeps all receipts and disbursement forms and provides reports at all regular meetings. Coordinates with Finance & Budget Chair so that financial statements are reviewed monthly with officers & Governing Board. Completes a mid-year review with Finance & Budget and makes recommendations to the Board if necessary to end the year BALANCED.

Duties of the Treasurer Asks questions about any discrepancy between budgeted and actual expenses. Submits the financial accounts of the chapter to a CPA or bookkeeper to file with IRS . Gives receipts for collection of cash, keeps copy of transaction for Chapter’s permanent records. Provides records to chapter Audit Committee for annual review. (Some Chapters do quarterly or mid- year as well… refer to Chapter Standing Rules)

Duties of the Treasurer Handling Reimbursements Have a clearly defined Policy for reimbursable expenses in your Standing Rules (break it into separate categories) Give reimbursement for budgeted/approved expenditures ONLY (stay within the budget) Have a deadline for submitting receipts Use an Expense Request Form Keep ALL Records in case of an IRS audit

Duties of the Treasurer Fiduciary Obligation The legal requirement to care for another’s assets as you would your own . . . to provide meaningful oversight!

Duties of the Treasurer Meaningful Oversight Meaningful oversight involves more than an occasional look at the budget. It means to constantly monitor your Chapter’s financials to remain balanced!

What do all successful businesses have in common? Question ? ? ? What do all successful businesses have in common?

Answer A Budget!!!

Chapter Budget What is It? The Forecast of Financial Activity over a period of time.

Budget Planning Cycle (1) F & B Committee Researches History & Future Needs (2) F & B Develops Budget for Upcoming Year (3) Governing Board Approves for (4) Approved Budget Presented to Chapter Members (1) F & B Committee Researches History & Future Needs

hi Chapter Budget WHY have a budget at all? Every Successful Business Plan is guided by a Budget Plan! Gives Governing Board a roadmap to follow based on what has been budgeted for 2012 Puts your Chapter on the right track for planning and achieving a successful year

Budget ~ What’s Included? Revenue National Membership Dues Income (# of National Members x Local Dues) Local Affiliate Membership Dues Income (# of Affiliates X Annual Affiliate Dues) Strategic Partner Money (Annual and/or Monthly Partners) Ways and Means Money (Money from Chapter Events) Other Revenue: (i.e. Education Classes or Sale of Merchandise)

Budget ~ What’s Included? Expenses Monthly Programs (Breakfast/Luncheon Expense, Speaker Expense) Education (MCE classes, PMN course) Ways & Means Expenses Newsletters (E-blast / Design Cost) Leadership Development (Officer Travel to National/State/Regional/District) Leadership Orientation (National LO for PE, State MO for officers & committee chairs)

Budget ~ What’s Included? Expenses Awards (Member of the Year, etc.) Strategic Initiatives (Education Scholarships, Funds for non-officer members to attend State/National meetings New Membership Orientation (Orientations, Pins, etc.) Office Supplies (Postage, Printing) Professional Services (Insurance, CPA, Legal)

Budget ~ What’s Included? Expenses Website (Set-up, Monthly Fees) Rental Storage Discretionary Fund (Flowers, Memorials) Bank/Credit Card Service Charges Miscellaneous or Other Expenses:

Stay within your Budget Don’t spend this If all you have is this amount!

Audits and Reserves President appoints Audit Committee at the next to the last meeting of the elective year. Audit is the Check and Balance System that validates information and protects both Treasurer and Chapter. Audit Committee presents report at the first meeting of the next year. Each Chapter should seek to maximize financial resources to best advantage and generate systems to protect member funds.

Chapter Legal Issues page 127-134 LPPM Tax ID Number (FEIN) IRS Exempt Status- “501 (c) (6)” Form 1024 IRS Information Return Form 990 (gross income or assets $25,000 or more) Form 990N (gross income or assets less than $25,000) Filing deadline is May 15th (Aug.15 w/1st extension; Nov. 15 w/ 2nd extension)

Federal Employer ID Number (FEIN) Every local and state chapter should have one Identifies companies and organizations, like a SSN does individuals Banks require to open most banking accounts, especially when the account earns interest Apply for a FEIN on line: https://sa2.www4.irs.gov/modiein/individual/ index.jsp

Federal Employer ID Number (FEIN) Your new number will be provided at the end of the process Record this number in the Chapter Management Center for future officer reference

Reporting to the IRS and Tax-Exempt Status Effective with the 2007 tax year, every Local Chapter must file an information return with the IRS Chapters filing a regular 990 return should continue to do so; small Chapters may file on line at : http://epostcard.form990.org/ In order to file, the Local Chapter must be deemed exempt by the IRS. Use IRS Form 1024 available at: http://www.irs.gov/pub/irs- pdf/f1024.pdf

Reporting to the IRS and Tax-Exempt Status Information form 990 is generally needed when annual Chapter gross income or assets are $25,000 or more Even tax-exempt Chapters have to pay “Unrelated Business Income Tax”

Incorporation Provides personal liability protection beyond that of the Chapter’s bylaws Being incorporated as a not-for-profit association is not the same as being federally tax exempt The common term “501 (c)(6)” refers to the section of the IRS Tax Code that covers real estate and other trade associations

Sales Tax Generally speaking, Chapters WILL NOT be exempt from paying retail sales tax. Tax exempt status means there is no federal tax on revenue

Defense & Indemnification of Officers & Directors WCR Chapters are covered under the NAR Professional Liability Insurance Policy Claims for general liability, theft or bodily injury are NOT covered by this policy – Chapters should always get event insurance The PL policy has a deductible for Local Chapters of $3,000

General Liability Insurances Sometimes required when holding a Chapter event on public or private property Chapter must arrange coverage, usually through a local insurance agent Limit your liability when serving alcohol at your events

Ways & Means Committee Page 33 LPPM Assumes from Finance & Budget Committee the responsibility to conduct fundraising programs Raises funds to enable the Chapter to fulfill the WCR Mission Statement

Ways & Means Ways & Means Committee should plan events for the year and must submit Proposed Budget for Each Event to Governing Board for approval and inclusion in Chapter’s overall Budget EACH Fundraising Event must have a Budget. No money can be spent until Event Budget(s) is approved. Only the Chapter President may sign a Vendor Contract, after Governing Board Approval. Event Insurance is Required Chapter Treasurer is member of Ways & Means Committee

For any questions or concerns contact Sharon Morton 2012 Texas Treasurer Sharon@SharonMorton.com 832-524-6530 Together We Will Work it! Work it! Work it!