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Annual Obligations & Internal Controls

The chapter treasurer, perhaps more than any other position in the Fraternity, has a number of annual tasks that they must complete in order for the chapter to maintain good standing with the Internal Revenue Service, International Fraternity, and University.

Annual Tasks

The chapter treasurer, with assistance from the finance advisor, should remember, budget, and plan for the following items:

  1. Plan for annual assessments. The chapter treasurer should budget for the annual chapter assessment, Liability Protection Program payments, and any local IFC dues that need to be paid on a semesterly/quarterly basis. In addition to this, the chapter treasurer and executive board should ensure that each member pay the initiation fee prior to their initiation.
  2. Complete all tax obligations. The chapter is designated as a 501(c)(7) organization through the Internal Revenue Service. This means that any income collected on behalf of the organization from its dues-paying members is exempt from federal taxes. However, in order to maintain that status the chapter must file their Form 990 annually. The Form 990 should be filed no later than November 15th of each year. You can find more information about filing the Form 990 here.
  3. Ensure proper reporting of new-members & initiations. The chapter is required, per convention delegation, to report new-members and initiations in a timely manner. This task usually falls onto the secretary or treasurer. As finance advisor, it is recommended to make sure the chapter is correctly doing this so they can avoid fines for delayed reporting.

Internal Controls

While this was not discussed on the previous page about OmegaFi, one of the best services that OmegaFi can offer is financial transparancy and accountability. More frequently than should be the case, the Fraternity hears about stories of chapter treasurers embezzling chapter funds across the country – some of them at PIKE chapters. OmegaFi, if properly used, will help reduce this risk almost down to zero as multiple people will have access to the balance sheet and will be able to track any improperly used funds.

As a finance advisor, this is one area where you can you really help make a difference by having view-access to the chapter’s Vault account. Additionally, it is recommended that the finance advisors help in the annual chapter audit. For some of our larger chapters & house corporations, this might mean advising the chapter treasurer on a CPA that can help complete the audit. For others, the finance advisor might be a CPA who can complete the audit for the chapter himself. Either way, an annual audit of the chapter’s finances is critical to the long-term financial stability of the chapter.

Please see this PIKE Blog post for more information on proper internal controls.

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