FINANCE CONSIDERATIONS FOR THE LOCAL PRESIDENT AND REGION CHAIR

Or: Everything You Wanted to Know About Your Fiduciary Responsibilities,

but Were Afraid to Ask

BEFORE WE BEGIN…• This is an overview, not a “how-to”• You don’t need to do all of the work! Just

make sure that it gets done.• Most of this stuff is covered in more detail in

the Financial Procedures for Locals & Regions (FPLR) manual, or other materials available from IEA

PRE-CLASS QUIZ1. As a dues-paying member of my local IEA

association, I want my local’s money to be safeguarded from loss and mismanagement, and used effectively.

TRUE _____ FALSE _____

PRE-CLASS QUIZ2. I don’t want my local or Region to get into

trouble with the IRS or another government agency by violating laws or regulations.

TRUE _____ FALSE _____

PRE-CLASS QUIZ3. Who is responsible for making sure that there

are no problems with the above?

A. LOCAL/REGION TREASURER _____

B. GOVERNING BOARD/COUNCIL _____

C. SCHOOL SUPERINTENDENT _____

D. NO ONE, IT JUST HAPPENS _____

PRE-CLASS QUIZ

4. Who presides over the governing board/Council?A. LOCAL PRES./REGION CHAIR _____B. LOCAL/REGION TREASURER _____C. SCHOOL MASCOT _____D. NO ONE, IT JUST RUNS ITSELF _____

ANSWER KEY

1. TRUE2. TRUE3. B4. A

How did you do????

WHO SAYS SO?

THE ILLINOIS ATTORNEY GENERAL SAYS…

The full membership of the governing body is responsible for the organization, and each member acts at all times in an ethical manner and in the best interest of the organization and the public.

THE ILLINOIS ATTORNEY GENERAL ALSO SAYS…

The governing body exercises active oversight of the financial affairs of the organization and sets policies to ensure that the organization’s resources are used appropriately in furtherance of the organization’s mission.

THE A.G. SAYS THAT OUR BOARD/COUNCIL MEMBERS SHOULD…

•Become familiar with all financial matters. •Regularly request financial information and review all annual reports and audits of the organization’s financial affairs.• Each board member should be sure to review and keep copies of the returns filed with the Internal Revenue Service.

THE A.G. ALSO SAYS THAT OUR BOARD/COUNCIL MEMBERS SHOULD…

• Assure compliance with applicable local, state and federal laws, including timely filing of reports and meeting procedures.•Provide for regular meetings of the board and its committees with adequate reports on – and discussion of – organizational activities.•Ensure financial resources to conduct organizational activities.

THE A.G. SAYS MORE - OUR BOARD/COUNCIL MEMBERS SHOULD…

•Provide sound investment and management of organizational funds and assets ….to yield a reasonable return without undue risk. •Protect the organization’s property, including reasonable provision for safekeeping….

RESPONSIBILITIES…

NOTE: Delegating all of this to the Treasurer does NOT mean that you have fulfilled your responsibilities!

SAFEGUARDING VS. MANAGING• Safeguarding: Keep funds from being stolen,

lost, or not collected in the first place• Managing: Funds used for the benefit of

members– Discussion/Prioritization– Not wasted on fines, fees and penalties– No private benefit/conflict of interest

THIS CLASS WILL COVER:• Controls over member dues (Safeguarding)• Theft controls (Safeguarding)• Other loss controls (Safeguarding)• Bookkeeping/Financial reports (Managing)• Budget (Managing)• Government regulations (Both)• Atmosphere of honesty/integrity (Both)• Personnel considerations (Both)

CLASS FORMAT• Don’t hesitate to speak up at any time

– Questions– Examples– Bring us back to reality

QUESTIONS?

CONTROLS

Controls are procedures and organizational structure designed to help protect (safeguard and/or manage) your organization’s assets…

EXAMPLES OF CONTROL OBJECTIVES

• Fraud deterrence and detection• Prevention of unintentional errors• Ensure that dues income is collected and

deposited• Funds not wasted or spent inappropriately• Funds not spent on fines, fees and penalties

CONTROLS: OTHER BENEFITS

• Protect officers/Board members from embarrassment and liability

• Protect the credibility of the Treasurer

CONTROLS OVER MEMBER DUES

• Local dues probably account for 90-100% of your income

• You are responsible for collecting and remitting IEA-NEA dues, and FCPE

• Region rebate: probably 100% of Region’s income

DUES COLLECTION/REMITTANCE

OBJECTIVES OF CONTROL PROCEDURES (LOCALS)

• IEA membership roster always current• Payment of dues for leaders is handled correctly• Accuracy of withholding is verified every pay

period• All dues are remitted, and deposited intact• Payments to IEA conform to schedule and

amounts are correct• All dues and FCPE have been paid at the end of

the membership year

WHEN CONTROLS ARE NOT THERE…

• Dues withheld are not enough to cover the IEA-NEA obligation

• Payment of dues for leaders exceeds the total amount of local dues income

• Treasurer deducts cash when depositing dues checks

• Late payment penalties/Scrutiny from IEA• RA delegates not seated

“MACRO APPROACH”

Dues/FCPE obligation (IEA statement): $10,000Local dues to be collected: +1,000Dues paid on behalf of President: – 500Total to be collected: $10,500Pay periods withheld :

10 Each check should be approximately $ 1,050

“YTD MACRO APPROACH”

Total to be collected: $10,500Year to date payments received: -3,500

Remaining payments to be received: $ 7,000Payments remaining:

7 Next check should be approximately: $ 1,000

“MICRO APPROACH”

Maintain a spreadsheet listing dues info for all members

Update the sheet every time someone joins/leaves

Reconcile spreadsheet to IEA statement monthly

Reconcile spreadsheet to dues deduction list every pay period

QUESTIONS?

REGION REBATE BASICS• Computation- FTEs X Budgeted rebate amount• FTE vs. Member• “Bylaw amendment”• Laptop computer charge• Carryover of funds• Availability of funds• In-region funds• Preliminary vs. final rebate

REBATE BASICS• Prior year financial report• Board Policy 15

BYLAW AMENDMENT• Your region has 2,000 members, all FT ESPs• So you have 1,000 FTEs• Ratio of FTEs/Members= .50• FTE amount= $20• Rebate before amendment= $20,000

($20 x 1,000)• Rebate after amendment= $34,000

(85% x 2,000 x $20)

REBATE INFO6/16/2015

2014-2015 Regional Rebate99

Active Full-Time Equivalent Members 1341

Budgeted Regional Dues Rebate per FTE: $17.80

CURRENT YEAR REBATE: $23,869.80$2,048.00

PRIOR YEAR BALANCE: $7,521.82

TOTAL REBATE: $33,439.62

REGION

REGIONAL REBATE

INCREASE DUE TO 2008 IEA BYLAW AMENDMENT:

REBATE INFO

Direct Deposits:ACH # DATE AMOUNT025418 2/11/2015 4,000.00 025997 4/8/2015 11,000.00 026011 4/14/2015 4,000.00

TOTAL REBATE PAID: $19,000.00

REBATE BALANCE: $14,439.62

REBATE INFO

IN-REGION FUNDS

CURRENT YEAR: $1,400.00Laptop ($300.00)PRIOR YEAR BALANCE: $3,300.00TOTAL FUNDS: $4,400.00

Direct Deposits:ACH # DATE AMOUNT

TOTAL PAID $0.00

CURRENT BALANCE: $4,400.00

REGION CONSIDERATIONS• Make sure you have procedures in place to

verify all of the numbers and transactions• Understand the concepts and rules regarding

the region budget• Don’t ask for funds if you don’t need them

QUESTIONS?

THEFT CONTROLS• “That could never happen here”• “We all trust each other”• “No one would know how to steal from us”• “If I insist on having controls, my Treasurer will quit”

If you believe these myths, you risk eventually pulling your head from the sand and finding all of your region/local funds gone, and members

asking “How did you let that happen?”

YOU NEED THEFT CONTROLS BECAUSE…

• People steal when they need money• People steal when you just make it too easy• People steal when they can rationalize it• Occasionally, someone who is just plain

dishonest gets into a position of responsibility• Worst case: Combination of the above!• Even if your officers are 100% honest, how about the next group? Or the next?

THE “FRAUD TRIANGLE”

“TOP 5” THEFT CONTROLS

5. No debit or credit cards4. Annual audit3. Two signatures on checks2. No checks written to “cash;” No dealing in cash1. Have the bank statement(s) mailed to someone besides the Treasurer

PREVENTION/MITIGATION OF CASH DEDUCTED FROM DEPOSITS

• Instruct the bank (in writing): No cash withdrawals of any kind

• Electronic transfer of employer dues payments• Make sure the annual audit addresses cash

withdrawals• Have your employer deduct IEA-NEA dues

separately and forward directly to Springfield (NOTE: You’re still responsible for correct

payment!)

IF YOU INSIST ON HAVING A CREDIT CARD…

• One person has custody• Statements go to someone who does not have

custody• Email alerts for all expenditures• Documentation: Credit card slips with

signatures; details• DO NOT PAY BILL BASED SOLELY ON MONTHLY

STATEMENT!

BENEFITS: ANNUAL AUDIT

• Helps ensure compliance with bookkeeping and filing requirements

• Helps ensure compliance with internal requirements

• Fraud deterrence/detection/collusion• Credibility with members• Identify control deficiencies

SPECTRUM: AUDIT OPTIONS

• Internal committee• Outside CPA

– “Agreed-Upon Procedures”– “Review”– “Audit”

• Regions will always use an internal committee

AUDIT OPTIONS

See IEA website for additional information on how to make this

determinationwww.ieanea.org

WHICH IS RIGHT FOR YOU?

• Size/Dues obligation• “Complexity”

– History of questionable integrity– Chronic lateness in paying IEA-NEA dues– Files IRS Form 990 or 990-EZ– Politically active/Files D-2s– High local dues/Numerous local activities– Sends several delegates to RAs

RIGHT FOR YOU (Continued)

• Uses debit or credit cards, or deals in cash• Compensation paid to leaders• Recent involvement with regulatory groups,

e.g. IRS• Numerous bank accounts• Donations solicited (e.g. scholarships)• Poor working relationship with employer• Employer bookkeeper is incompetent

INTERNAL COMMITTEES

• Do not include officers, ESPECIALLY the Treasurer

• Consider the Treasurer of a nearby local/region

• Give the Committee a specific “game plan”• Written report by Committee (share if useful)• Start small/Keep adding

OUTSIDE CPAs

• Constraints: Professional Standards• Required documentation

– “Representation letter”– “Engagement letter”

• Understand what they will (and won’t) do• Understand what they take responsibility for• Payment amount/Timing• Assistance with selection

AN AUDIT IS NOT THE ONLY CONTROL THAT YOU NEED!

• Except for very small locals, the audit can’t scrutinize every single transaction

• People can be ingenious!• An audit is important, but don’t let it

give you a false sense of security

QUESTIONS?

OTHER LOSS CONTROLS• Banking: Maximize interest/Minimize fees• Deposit checks when received• Written reimbursement policy for all travelers• Authorize bank accounts and signers annually• Bank reconciliation• Check mathematical accuracy of bills and reimbursement requests

“SIGNS OF FRAUD”

• See the FPLR manual• If you see them, what do they mean?

– Fraud is not necessarily taking place, but the opportunity is present

– You need to take action (don’t ignore the signs)– Don’t jump to conclusions– Don’t accuse anyone– Talk to your UD

“TOP 5” SIGNS OF FRAUD

5. Organization always seems to be short of cash and/or late in paying IEA-NEA dues4. Poor documentation/No documentation3. Excessive dealing in cash2. Treasurer won’t provide access to records1. No oversight by governing body

POP QUIZ #11. Which of the following is NOT an important component of controlling the member dues collection/payment process?

a. Your IEA membership roster is kept current at all timesb. Your employer is remitting the correct amount of dues to you every pay periodc. Your local is paying its required obligation to IEA per

the quarterly dues payment scheduled. All payments from your employer are deposited intact, i.e. no cash deductions are made

POP QUIZ #12. It’s June, all of the member dues deductions for the year have been made, and your local does not have enough money in the bank to pay its last IEA-NEA dues payment. What is a possible cause of this situation?

a. The employer agreed to deduct dues over 16 pay periods but only deducted them for 14b. Your Treasurer made some unauthorized cash withdrawals when depositing the dues checksc. The employer did not deduct dues for five new members d. All of the above

POP QUIZ #1

3. Which side of the “Fraud Triangle” is most under your control?

a. Opportunityb. Rationalizationc. Pressured. Cash flow

POP QUIZ #14. Which of these is NOT one of the “Top 5 Theft

Controls”?

a. Have monthly bank statements mailed to someone besides the Treasurerb. Have an annual auditc. Have a budgetd. Do not allow cash transactions

ANSWER KEY

1. C2. D3. A4. C

Questions??

BOOKKEEPING

Every dime that goes in and out of your bank account(s) needs to be recorded, and documentation needs to be kept on file to:– Support your financial reports– Retain data in case of audit– Support operations

• Bills not paid twice• Quick information retrieval in case of questions

BANKING ISSUES

• Taxpayer ID number

• Board awareness: Accounts/Signers

• GET COPIES OF CANCELLED CHECKS!

NEED FOR FINANCIAL REPORTS

• Keep the Board/Council informed • Regions: Part of annual budget process• Monitor spending• Using your members’ money: Decision-making and prioritization• IRS/DOL reporting for some locals• Member credibility/Rumor control

BASIC COMPONENTS

• Cash on hand - Beginning and current• Categorization of income and expense• Actual vs. budget• Actual vs. prior year• All bank accounts should be included

CATEGORIZATION OF EXPENSES

• Functional– Board meetings– RA delegates– Newsletter/Website– Bargaining– Member representation

CATEGORIZATION OF EXPENSES

• Nature– Meals– Printing– Travel– Stipends– Office supplies

CATEGORIZATION OF EXPENSES

• Hierarchical combination (see region budget format)– Board meetings

• Meals• Supplies

– RA delegates• Hotel• Mileage

OTHER CONSIDERATIONS

• Frequency• What do you show your members?• Test the accuracy as part of the annual audit

QUESTIONS?

WHY SHOULD WE HAVE A BUDGET?

• Financial planning• Avert preventable financial disasters• Prevent arguments over spending• IEA reimbursement of mediation/arbitration costs

– Dues: $15/member– Budget: $3 per member budgeted for specific

categories• Member satisfaction• Regions: It’s an IEA requirement!

RESOURCES

• FPLR manual• Video• Other material on IEA website• Spreadsheet template• Your UD/Local office• Other locals/regions

REGION BUDGET SPREADSHEET

• Important components– Instructions/Suggested process– Guidelines/Suggestions– Checklist– Account tracking

POP QUIZ #21. Which of these is NOT a good reason to have

monthly financial reports for your local?a. It’s part of your Treasurer’s job descriptionb. They keep your governing body informed about your local’s financial statusc. They are helpful in making choices about how to spend your moneyd. They help to squelch rumors about your local’s finances

POP QUIZ #2

2. What was recommended as a way to test the accuracy of the monthly financial reports?

a. Have the Board compare the reports to the bank statementsb. Have them tested as part of your annual auditc. Have good controlsd. Verify that the addition is correct in all columns

POP QUIZ #2

3. To automatically qualify for IEA financial assistance for mediation, factfinding and arbitration, your local dues must be AT LEAST:

a. $10b. $15c. $20d. $25

POP QUIZ #2

4. Which of the following was listed as a reason for a local to have a budget?

a. The IEA has a budget, you should have one alsob. It’s required by the IEA Bylawsc. Having a budget ensures financial successd. It is useful when planning financial initiatives

such as building up a crisis fund

ANSWER KEY

1. A2. B3. B4. D

Any surprises??

GOVERNMENT REGULATIONS: LOCALS VS. REGIONS

• Locals are considered as related to, but separate from, the IEA

• Regions are technically part of the IEA• Both are tax-exempt for the same reason,

so many rules apply to both

IRS TAX EXEMPTION (LOCALS AND REGIONS)

• Classification: Labor union- Section 501(c)(5)– State sales tax– Contributions received– Purpose is to benefit members

• IRS determination letter/Articles of incorporation

• “Nonprofit” vs. “No profit”• Taxpayer ID number (When in doubt, IEA has

your number on file)

INTERACTIONS WITH THE IRS

• Written “notices”– Don’t ignore! Respond per deadlines– Verify taxpayer ID number– Keep copies– Seek help!

• Audit– Seek help!– Seek help!– Seek help!

• Annual returns

WHICH RETURN DO I FILE?

• Regions: No filing requirement• Locals: Depends on your “average annual

gross receipts”• AAGR does NOT include the IEA-NEA dues that

you collect and forward to Springfield• < $50,000: 990-N (“E-Postcard”)• $50,000- $200,000: 990-EZ• $200,000+: 990 (or assets > $500,000)

WHO FILES WHAT?

• 900+ IEA locals file the e-postcard• IEA files on behalf of all but a handful of these• About 30 locals file the 990 or 990-EZ• For the latter, we strongly advise that you

engage a CPA to prepare and file the return• You need to be aware of the filing thresholds,

to make sure you are filing the correct return

990/990-EZ ISSUES

• IRS code section • Three “programs”• Compensation

– Reporting– Employer reimbursements

• General appearance/Mathematical Accuracy/Spelling

• REMEMBER: This is a public document!

QUESTIONS?

IRS BOOKKEEPING RULES

• All financial transactions: Obtain documentation and keep on file:– Date/dollar amount– Business purpose– Payee/Source of funds

• Actual receipts, not just a note asking for reimbursement

• Mileage: Start/End points

COMPENSATION PAID TO LEADERS/OTHER MEMBERS

• “Compensation”- Payment for services rendered• “Reimbursement”- Payment for business

expenses incurred• “Compensation” is taxable “Reimbursement” (if properly documented) is not taxable• Payment of dues on behalf of someone

IS “Compensation” and thus taxable

HOW IS COMPENSATION REPORTED?

• Employee vs. independent contractor (sometimes gray area)

• Employee: All compensation, regardless of amount, reported on W-2

• Due to complexity of withholding/filing requirements, we strongly suggest that you get outside help with employee bookkeeping/filing

EMPLOYEE VS. INDEPENDENT CONTRACTOR

• Dollar amount• Officer vs. non-officer• Payment

– Frequency– Hourly, annual, etc.

• Control over actions• About 15 other criteria

INDEPENDENT CONTRACTOR (MEMBERS)

• Stipends/Payment of dues• Payment for work performed, e.g. setup of

website• Total annual compensation < $600- No

reporting requirement• $600 or more; Must report on Form 1099-

MISC• Be aware of deadlines and rules

“TAXABLE” VS. “REPORTABLE”

For independent contractors:– ALL compensation is taxable, i.e. must be reported

on their tax return– ONLY compensation of $600 or more in a calendar

year is reportable by you– Exception: Reporting payments less than $600 in

case of theft/not providing documentation for expenses

– Do NOT tell people that compensation less than $600 is nontaxable. It’s just nonreportable.

INDEPENDENT CONTRACTOR(NON-MEMBERS)

• Same basic rules as for members• Reporting requirements apply only to payments

to individuals, not corporations or partnerships• You need their taxpayer ID number in order to

report them. If you pay someone $1,000 to fix your website, you should ask for their Social Security number before the job is complete. This will also give them fair warning that the payment will be reported.

GIFT CARDS• The IRS considers gift cards as being the same

as payments of cash, and like payments of cash, there is no “de minimis” threshold. Virtually all payments are taxable!

• Locals: This is not a big deal unless:– You give a card to someone who gets a W-2 from

your local– The amount of the card, in conjunction with other

compensation, brings the annual compensation of someone up to the 1099 threshold ($600)

EXAMPLES

• You pay your President $3,000 per year and report this on a W-2. If you give him/her a $50 gift card, you need to report $3,050 as income on the W-2

• You pay $580 of your Treasurer’s dues. This is not reportable, but if you also give him/her a $50 gift card, the compensation is now $630 and IS reportable

ADDITIONAL CONSIDERATION FOR REGIONS

• Since regions are technically part of IEA, then gift cards given to IEA employees become very problematic.

• Due to the reporting requirements, regions should NOT give gift cards to IEA employees

• IEA employees include:– GPAs– Interns– MVCs

GIFT CARDS: CONCLUSIONS

• If at all possible, refrain from giving gift cards• Be aware of the possible reporting

requirements• For all gift cards, keep a record of the date,

amount, payee, and business purpose• Regions should absolutely not give gift cards

to IEA employees

QUESTIONS?

CONTRIBUTIONS TO POLITICAL CANDIDATES (LOCALS)

• Contributions should go to local candidates, i.e. school board

• Don’t contribute to state candidates• Make contributions out of IPACE rebate

money, not local dues• Keep your investment income under

$100/year to avoid tax issues

MEMBER IPACE CONTRIBUTIONS

• All members pay $30/year, along with their dues

• Payment is not optional, and your local is responsible for collection

• Members can get a refund of their $30; they have to contact Government Relations

IPACE REBATES

Your local is entitled to a rebate of IPACE contributions from your members– 20% ($6/contributing member)– 50% ($15/contributing member)– Additional funds available in special

circumstances– “Contributing Member” means those who did

not request a refund of their contribution

REBATES: YOUR RESPONSIBILITIES

• Keep IPACE funds in a separate, non-interest bearing account– Only deposits: Funds from IPACE – Only payments: Legitimate political expenditures

• Know what IPACE funds can be spent for, and what they cannot

• Keep good records• Know your State reporting requirements

STATE REPORTING REQUIREMENTS

• Illinois State Board of Elections requires you to register as a PAC immediately, if you meet the filing criteria

• Criteria: Spend $5,000 or more in ANY 12-MONTH PERIOD on:– Supporting/Opposing political candidates– Supporting/Opposing an issue on the ballot, e.g.

referendum– “Electioneering Communications” (exception:

member-to-member communication)

IF YOU ARE REQUIRED TO REGISTER…

• Do so (Form D-1) within timeframes• Amend your D-1 any time info changes• File quarterly D-2• File other forms when you meet the criteria• Filing requirements are ongoing forever,

regardless of your level of activity in any given quarter

MAKE SURE YOU COMPLY

• Monitor expenditures on an ongoing basis– Cumulative dollar amount– Type

• Avoid crossing the threshold if you can• Register if you must• Don’t forget to file D-2’s: Substantial fines for

being late (even one day)

QUESTIONS?

FUND FOR CHILDREN AND PUBLIC EDUCATION (FCPE)

• NEA PAC (equivalent of IPACE)• Contributions to FCPE cannot be made out of

local dues money (consideration at NEA RA time)

• “Hard” vs. “soft” money• Rules for solicitation

SOLICITATION OF FUNDS FOR “CHARITABLE PURPOSES”

• Scholarships, tornado relief, etc.• State registration/filing requirements

– $4,000 in “charitable assets” OR– $15,000 in income (any 12-month period)

• Must register with state, pay fees, file annual reports

• Avoidance:– Stay under thresholds– Work with an existing charitable organization and have

funds flow through it

IRS CONSIDERATIONS• Regions should not solicit funds for charitable

purposes (part of IEA)• Any contributions made to your local/region

for charitable purposes is NOT tax-deductible• If you solicit funds in writing/electronically,

the solicitation must include a statement to this effect, that meets IRS guidelines

“PRIVATE SECTOR” LOCALS

• Employer is not a government entity• Must register with U.S. Department of Labor

as soon as local is formed• Initial/annual filing requirements;

bookkeeping issues

POP QUIZ #3

1. Your local/region is regarded by the IRS as what type of tax-exempt organization:

a. 501(c)(3) Public charityb. 501(c)(5) Labor unionc. 501(c)(6) Business league

d. Fraternal Beneficiary Association

POP QUIZ #3

2. Nearly all IEA locals file which of the following annual returns?

a. 990b. 990-EZc. 990-Nd. No return required

POP QUIZ #33. Which of the following payments to a local

President/Region Chair would require filing a 1099-MISC?a. Advance of $1,000 for the purpose of attending the RAb. Payment of his/her IEA-NEA dues in the amount of $400c. Reimbursement of travel and business expenses in the amount of $800d. Payment of a $750 stipend as compensation

POP QUIZ #34. Which of the following is NOT true?

a. As tax-exempt organizations, IEA locals and regions are not required to pay Illinois sales taxb. You may spend IPACE funds to purchase yard signs for school board candidatesc. You should not solicit funds for the NEA’s Fund for Children and Public Education from non-member school employeesd. If you pay a member a large salary, you may be required to withhold payroll taxes and file form W-2 at the end of the year

ANSWER KEY

1. B2. C3. D4. A

Questions?

ATMOSPHERE AND ENVIRONMENT

• General reputation of labor unions• Solution:

– Transparency– Follow rules– Implement and enforce controls– Avoid conflicts of interest– Provide avenues for addressing questions/concerns– Don’t let expediency cause you to do the wrong

thing

PERSONNEL

Selection of honest/qualified candidates– Job descriptions– Qualification requirements– Avoid those who have demonstrated bad behavior

TRAINING AND DEVELOPMENT

Make sure funds are available and leaders understand expectations:– IEA trainings/website resources– Local IEA office– Outside organizations– Structured meetings of peers

SUCCESSION PLANNING

• Your successor• Selection of next Treasurer• Treasurer transition

– Written expectations– Job shadowing– Calendars/Procedure manuals– Documentation, filing, etc. up to date

LAST RESORT…

• Mechanism for removing someone from office– Won’t do work– Can’t do work– Bad behavior- theft, etc.

• Just, fair, impartial process• Governing documents• Work with your UD

POP QUIZ #41. Which of the following was NOT suggested as

a way to maintain a good public image?a. Be transparent with how you spend your members’ moneyb. Don’t allow conflicts of interestc. Invite your members to attend all Board meetingsd. Make sure that your leaders know that they are free to express concerns

POP QUIZ #4

2. What was one suggestion to promote a healthy and honest work environment within your local?

a. Support your Treasurer in enforcing your local’s rules regarding payment approvals,

documentation, etc.b. Make it clear that you expect resultsc. Require background checks for anyone who handles moneyd. Have a good whistleblower policy

POP QUIZ #4

3. What was cited as a way to ensure a smooth transition of Treasurers?

a. Personally train the new Treasurerb. Make sure that you have up-to-date calendars of important datesc. Require a “job shadowing” period of at least six monthsd. Require the new Treasurer to pass a test prior to assuming his/her duties

POP QUIZ #4

4. What was NOT suggested as a way to make it more likely that you will have honest and

competent colleagues as local leaders?a. Have an impartial and fair method of removing

leaders who are demonstrably dishonestb. Make sure that leadership positions are filled by

people that you have known for a long timec. Implement screening mechanisms such as job

descriptions and required qualifications.d. Encourage training and development

ANSWER KEY1. C2. A3. B4. B

Comments? Questions?

CONCLUSION

• Your local/region is a business and has to be run as one

• This includes procedures/controls to ensure that your members’ funds are used appropriately

• Overall responsibility: Governing body• Your role:

– Make sure it happens– Don’t do all the work yourself– Try to surround yourself with capable, honest people

RESOURCES

• Local IEA office• IEA Secretary-Treasurer• IEA Business Services Department• IEA Government Relations Department• IEA website• Peers

FINAL QUIZ/BRIEF TOUR OF WEBSITE