Techniques For Staying On Budget

The treasurer is the only member of the chapter who is authorized to spend chapter funds. Other brothers who require expenditure of funds for the completion of their duties (recruitment chairman, social chairman, house manager, etc.) must make advance arrangements with the treasurer, adhere to the policies of the treasurer and finance committee (including the expenditure limit), or accept individual responsibility for his spending. Delegations of this nature must be made with care and explained with clarity.

  • Do not burden the treasurer or the chapter with individual expense items from vendors such as clothing, stationery, mugs, jewelry, newspapers, etc. Keep chapter bills uncluttered by items not pertaining directly to chapter affairs.
  • Allow no long distance calls charged to the house phone. Insist on collect, credit card, or third number billings. (Use pay phones!).
  • Post the chapter budget with monthly/quarterly statements of variances of income and expense from budgeted amounts. Include explanations, not excuses, as well as a list of accounts receivable to promote peer group pressure for prompt payment.
  • Review the budget and summaries at each Board of Governors meeting to determine how well the chapter is staying on budget. Discuss measures to be taken if there's a deficit or shortage.
  • Sit down every two weeks with the cook and steward to review the Board budget.
  • Review the past week's expenditures at each chapter meeting. Do not simply read columns of figures. The brothers will absorb pertinent information. Most members are surprised to realize the cost of large parties or formals. Let the brothers know the magnitude and scope of the treasury.
  • Acquire professional help. Many certified public accountants will keep journals and ledgers, complete tax data, and audit billings, receipts and dispersals for a pretty reasonable monthly fee. The professional expertise, unbiased evaluation of the treasurer performance and chapter situation, continuity when changing officers and invaluable advice will more than offset the required fee.
  • Keep organized files and records of all receipts, disbursements, budgets, income statements, and other transactions. Write everything down - do not trust it to memory. Label and date everything.
  • When the chapter votes to spend monies in excess of budget allowances, it must at the same time vote to raise the amount necessary to pay for the expenditure in question.
  • All members and associates are required to live in the chapter house and support the meal plan full time, unless they are local residents, working for their meals, or required to live in a dormitory.
  • No member or associate may move out of the house without the formal approval of the chapter and Board of Governors/House Corporation.
  • Consider not paying officers salaries or compensate on room or board.
  • Lock the kitchen.
  • Do not keep cash or checks lying around the chapter house.
  • Pay bills on time to avoid interest payments.
  • Allow only authorized officers to sign for purchases from local creditors.
  • Require receipts for all purchases.
  • Pay all bills by check and not by cash.
  • Do not become a check cashing service.
  • Never spend Initiation/Associate fees or Undergraduate dues on other chapter budget items.
  • Use a purchase order or purchase authorization system. Officers and committee chairmen are required to get more than one price quote. The treasurer must notarize this purchase authorization form.
  • Use incentives to pay bills early for the year/semester. (5% off for example) Then invest the money in a cash reserve or management account. Those accounts pay much higher interest and have become pretty liberal in check writing and withdrawal requirements.
  • A dual checking account system can be utilized in order to separate administrative/social operating costs and House/Board costs in two different accounts. This is sometimes of help in avoiding misappropriations. Never allow yourself to get below minimum balance for free checking.
  • Require individual officers and "money spenders" to keep individual ledger sheets of their own budget so the responsibility for budgeting is spread out more evenly. They keep records of outlays from their budget. Give them incentives for staying within their budget.
  • Don’t let a few delinquent members hold you up with sending in national fees. The fraternity assesses finance charges after 30 days, so send in a partial payment to the executive offices and then pass the finance charges off to the late payers.
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