Your Guide to Yearly and Mid-Year Financial Reviews for PTAs/PTSAs

​A yearly financial review completed in July is necessary to ensure that the board has engaged in responsible fiscal oversight and that good financial practices have been followed. It is a formal examination of the financial books and records of your PTA and serves to certify that receipts and expenditures, as authorized in the minutes, conform with bylaws, standing rules, and budget limitations. The annual financial review is also a PTA/PTSA insurance requirement.
Additionally, completing a mid-year review in January can make the year-end review easier to process and allows your PTA to catch any problems early on so that they are addressed as soon as possible.
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As a treasurer, you want to make sure your review committee can easily access all documents. As the review committee, you want to stay organized and have a good system for including all committee members in the process.
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Did you know that financial reviews can be done in person or virtually over a video call? Offering a digital option allows for more flexibility in how volunteers meet and can even make it more accessible with tools such as closed captioning during video calls.  Below, you will find pointers for both treasurers and financial review committees on how to organize, prepare, and complete an online financial review. Following the guidance below will help treasurers feel confident when handing over the books for review and help empower the financial committee members to fulfill their duties.

Who Can Serve on the Finanical Review Committee:
The financial review committee shall consist of no fewer than three members appointed by the president.

The financial review committee shall not include officers with signatory authority or individuals living within the same household as those authorized to sign on the bank account for the period being reviewed.
Further information about financial reviews may be found in the Managing Your Nonprofit PTA Handbook.

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TREASURERS
You want to make sure you are continuing to maintain your physical binder while also putting together a digital binder. The entire review committee will need access to the digital binder, but it’s recommended that at least one member of the review committee be given access to the physical binder as well. Note: Before you hand over your binder, remove anything you store in it that shouldn’t be shared, such as passwords. Also, if it is at all possible, give at least one person on your review team viewing access to your financial software.
Steps to creating a simple and easy-to-use online binder:

1. Choose your online program
   ​Uploading files should be simple, and you should be able to share them easily and securely with the financial review committee. Examples of online programs include, but are not limited to, Google Drive, Drop Box, and One Drive. 
   
   
2. Create a folder specifically for your financial review
   You may already be keeping digital files, but keep in mind that the best way to keep files for you to find may not be the best way for your review committee to locate those files.
   
   
3. Set up folders for each section
   You can find the Financial Review Checklist on the WA State PTA website. Note: Section 4 will not need a folder as that is for the review committee’s comments and signatures.
   
   
4. Fill each section’s folder with digital copies of these documents
   Each section has a list of documents needed to answer questions in that section. To make it easier for your committee to locate documents, if an item is needed for more than one section, put a copy of that document in both sections. To help organize each section folder, create folders within the folder to group items together. For instance, create a folder for each month where you can put your expenses and deposits for that month.
   
   
5. Clearly label all digital documents
   Keep in mind what the review committee will be looking for when naming it. Example: in Section 2, it asks for minutes where specific things were done (budget approval, elections, etc…). Consider labeling those minutes with that title (Budget Approval Minutes). When labeling expenses, consider using the check number (7623 Reimburse Chambers), as this puts your expenses in numerical order.
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6. Go through the review questions
   Once you have all your documents uploaded to your financial review folder, walk through answering each question and make sure you have all the needed documents. 

FINANCIAL REVIEW COMMITTEE MEMBERS
If you’ve volunteered to be a part of your PTA’s Financial Review Committee and are not sure where to begin, check out these 3 steps:

1. Set Yourself up for Success
   Each committee member should have a copy of the WSPTA Financial Review Checklist to follow along. One person should be in charge of notetaking. You will want to make notes on a draft and then sign the final draft to submit to the board.
   
   While working remotely, it’s helpful for each team member to take ownership of one section of documents: Meeting Minutes, Standing Rules, any additional Policies (such as money handling, password updates, etc.), Bank Statements, Reconciliation Reports, Treasurer’s Reports, Expenses Reports, Deposit Reports, Grant Documents, Budget, etc.
   
   
2. Understand the Financial Review Form
   Check out the document below document for notes on what documents to reference for each question. Click here to print the PDF of this document.
   
   
3. Use the Comment Section
   As you work through the checklist, make note of any exceptions in the comments. If you cannot answer a question based on the information and files that you have, note this and move on to the next question.
   
   ​The final page will require signatures from all parties of the Financial Review Committee as well as any feedback and recommendations for the board of directors to take under advisement. This is also a great place to provide positive feedback!

​IMPORTANT REMINDER:
The annual Financial Review is a requirement of your PTA/PTSA’s insurance. It is also a helpful tool meant to assist the treasurer and the rest of the board of directors in establishing and refining best practices. During a Financial Review, the policies and procedures are reviewed, and the committee’s feedback is important in providing guidance on those policies.
 
If you still have questions about preparing for or completing a Financial Review, contact Council Treasurer, Brenae Brix.