Convention 2012 Richmond, VA

Finances / Collections

Convention 2012Richmond, VA

THANK YOU!• FY12: another fantastic year for finances

• Please continue the efforts into FY13 and beyond

• Until we reach 100% - always room to improve

FY12 Collection Rates(as of June 30)

• 98.260% of Fall dues collected

• 89.822% of Spring dues collected

• 95.473% combined full year collected

• 100% paid Fall new member fees

• 100% paid Fall initiation fees

• 100% paid Spring new member fees

• All but two chapters have paid full Spring initiation fees

• 100% / 97.79% - full year NM/Init collected respectively

New IEC Treasurer

• Chris Rakunas – outgoing IEC Secretary / incoming IEC Treasurer

• Cal Tau alum

• Successful business career serving as the CEO of a hospital

• Accomplished Author

• Committed to continued improvements

Filing due on the 15th day of the 5th month after the end of your organization’s accounting period

For more information, visit www.irs.gov/eo or speak to a tax accountant

If needed, ask alumni for advice – chances are you have a CPA that would be willing to help

IRS – FORM 990 FILING

2010 Tax Year and later (Filed in 2011 and later) Form to File

Gross receipts normally ≤ $50,000 990-N

Gross receipts < $200,000, and total assets < $500,000990-EZ or 990

Gross receipts ≥ $200,000 or total assets ≥ $500,000 990

Which 990 Form to file?

Be sure to file!! Failure to file for three consecutive years = LOSS OF

TAX EXEMPT STATUS This happened to two chapters in June of 2011

IRS threatening for ALL of Pi Lam to lose tax status if chapters fail to file

IRS: $20 penalty PER DAY for each day failure to file continues (same penalty if you fail to give correct and complete information)

Committee has been formed to help ensure compliance (Brandon Taylor, Chris Rakunas, Pat Daley)

Use software – Quicken / Microsoft Money

Monitor actuals vs budget – adjust as needed (individual budget “swapping”)

Hold chairs to budgeted amounts – any fluctuations need Exec approval

General Tips for the KOE

Rex and KOE to have bank access (online, signature authority, etc).

Checks over $XX should require two signatures (Rex and KOE)

Alumni chapter/faculty advisor to have “review” authority (possibly signature authority as well)

Tips continued…

Tips Continued… Collect EARLY – more money to start the

semester

**Bank Reconciliations / Do not use ATM balance or “current” online balance to determine amount of cash available**

Include note with payments to IHQ detailing what payment covers

Payments to IHQ

Payments to IHQ Consist of:Per Caps ($325 per man)Insurance ($95 per man)Programming Assessment ($1500 per

chapter/colony)

Colony payment structure slightly differentif you are a Colony and you have questions,

please ask me or Ian

New overall policy in effect beginning with Fall 2010. Changes being made starting with 2012-2013 school year.

FY12 was fantastic – however, some probations and suspensions were handed down. This will continue to be enforced.

Current IHQ Collection Policy

There will be three payment options available to each Chapter/Colony:

1. Full YEAR payment by September 30

2. Full SEMESTER payment by September 30 and February 15

3. Two payments in the Fall (Sept 30 & Nov 15) and one payment in the spring (Feb 15)

Collection Policy Continued…

Payments consist of the following: Full year: 100% Per Caps/Risk Management and

Educational Programming Assessment OR Fall full semester payment: 60% of annual per

caps/insurance plus 75 % of Educational Programming Assessment

Spring full semester payment: 40% of annual per caps/insurance and 25% of Educational Programming Assessment. OR

Two Fall default payments: each at 30% of annual per caps/insurance and 75% of Convention assessment

Spring default payment: 40% annual per caps/insurance plus 25% of Educational Programming Assessment.

Collection Policy Continued…

Pay entire year by September 30 8% discount

Pay semester in full by respective semesterly due date 5% discount Fall Semester payment must be postmarked by 9/30 to

be eligible for Spring discount.

Two Fall payments / One Spring payment Default payment option No discount / no premium

Pros/Cons of Payment Options

NOTE: you will only receive the 5% discount on the full Spring semester payment if you paid the Fall semester was postmarked by September 30.

As you can see, the Spring full semester payment and the Spring default payment are identical. Therefore, the benefit is only given to those chapters who take advantage of the Fall full semester discount.

Collection Policy Continued…

Payment not postmarked within 5 days of due date: ◦ Probation with SOCIAL SUSPENSION◦ School and alumni association notified of social suspension◦ Probation lifted if payment received within 30 days of due date

Payment not postmarked within 30 days of due date:◦ Chapter placed on FINANCIAL SUSPENSION◦ School and alumni association notified◦ Remain on Financial Suspension until payment made or payment

plan presented to and agreed upon by IEC Treasurer and Executive Director and/or Director of Chapter Operations

Disciplinary Actions

What is Financial Suspension? Suspension of Charter - Pursuant to Article V Government, Section 5 (c) of the Pi

Lambda Phi Constitution, the International Executive Council may suspend the Charter of any Chartered group. 

Financial Suspension of Charter means that the Chapter must take all actions necessary to:

– Remain a member of the respective University/College, IFC and/or similar governing bodies or constituency

– The Chapter will not hold itself out as a Chapter of Pi Lambda Phi Fraternity. This includes, but is not limited to the following:

• Prohibition of participation in events where any individual(s) and/or group(s) would associate a chapter of Pi Lambda Phi Fraternity being associated with;

• The Chapter may not orally, in writing, or by symbol represent itself as a Chapter of Pi Lambda Phi Fraternity in any campus activities. Campus activities include, but are not limited to the following:

– Greek Week/Greek Games

– Intramural sports/events; and/or

– Social events

Financial Suspension Continued

Recruitment

• Recruitment will not be permitted unless approval is obtained from the Executive Director, or the Director of Chapter Operations, or the President of the International Executive Council

New Member Education

• New Member Education will not be permitted unless approval is obtained from the Executive Director, or the Director of Chapter Operations, or the President of the International Executive Council

• Each suspended group must submit a written proposal stating how continuing the new member education period will help to meet their financial obligations

– Approval will only be given if new member fees are paid as detailed in the new member and initiation policy

Chapters on Financial Suspension for two semesters will be given notice of charter revocation

Colonies on Financial Suspension for two semesters will be given notice of termination of colony recognition

Discipline - continued

New member fees to be paid within two weeks of pinning or by the new standardized semester due dates (10/10 and 2/20) New Member Fees are $65 per man. New Member Payment and Cards are sent to IHQ.

Request for Permission to Initiate form and appropriate fees are due AT LEAST TWO WEEKS BEFORE or by the new standardized semester due dates of (11/20 or 4/10). Initiation Fees at $175 per man. Fees and Permission to Initiate Forms are sent to IHQ.

Any “rush” request on pin /badge shipments will be at chapter’s expense

Penalty for late reporting/payment of initiation fees: $25 per man per semester

New Member Fees / Initiation

New Member Fees / Initiation Continued

Beginning with Fall 2010, any Chapter/Colony that fails to report and/or pay for New Member and/or initiation fees in a timely manner may be placed on probation with social suspension until payment has been made. The decision will be made on a case-by-base basis by the Executive Director, Director of Chapter Operations, IEC President, and/or IEC Treasurer

New member program may NOT begin until previous periods are paid, unless given permission by Executive Director and/or the Director of Chapter Operations

Roster Adjustments For 2012-2013 school year, roster adjustments due

to IHQ by August 31, 2012. Once verified through the school, these updated rosters will dictate billings.

This only happens ONE TIME each year.

Email current Officer contact info to Laura NOWlaura.patricio@pilambdaphi.org

Contracts Brother agreement (get completed/signed at

time budget is approved) Brother agreement / payment plan

• Only if legitimately “needed”

• Brother must present reason why it is needed to Exec Board

Don’t be afraid to ENFORCE contracts

Collections

Hit ‘em where it hurts the most. The previous list contained plenty of incentive to pay dues. But how about SOCIAL PROBATION? Who wants to miss out on social events?

More “Consequences”

Unable to attend New Member events Ineligible to be big brother Unable to attend initiation Unable to attend various brother nights/activities Unable to participate in chapter athletics Added “work shifts” at parties or functions Added DD duty Loss of voting privilege at meetings

“Consequences” for Non-Payment

Can’t attend closed partiesCan’t attend sorority socialsCan’t participate in sorority events around

campusCan’t attend “band parties”Extra “sober crew” assignments at “regular”

parties

Social Probation

If nothing else works and they are not living up to their commitment:

Small Claims CourtLow costs (if any)Simple proceduresIf you have the contract and signatures,

easy to prevail

Final Attempts

Omega Financial

Online chapter financial services including billing, statements, budget tracking, various payment options with direct transfer to chapter accounts as well as to IHQ, etc

System accepts credit cards, debit cards, and online checks

7 chapters have been actively using Omega – some beginning as early as 1998. A handful of others are considering implementing it this coming school year or at least researching it a bit further.

Examples from Brothers on how they handle late payments and payment plans currently. (This is the part where you talk)

Chapter Examples

How to budget Master budget (spreadsheet review) Sub-budgets by committee to feed master budget

Budget “backwards”

TIP: be conservative…overestimate costs, underestimate any variable income

Be sure to include an “allowance”

Budgeting

The following items will be available on the Pi Lam website in the members’ section within the next few weeks:

Budget Template for you to use (Excel) Collection Policy Chapter Brotherhood Agreement Template Chapter Brotherhood Payment Plan Agreement

Template This presentation Our international budget with explanations

PI LAM WEBSITE

If you slept through everything else…

• Do a 990 for the IRS

• Pay bills

• Communicate, communicate, communicate

How to reach me…Chris Rakunas - IEC Treasurer

treasurer@pilambdaphi.org

crakunas@hotmail.com

Cell: 310-871-4466

Facebook.com/crakunas

Q&A