So you’ve just become the treasurer (or are thinking of becoming a treasurer) for your local club, but you’re not sure what it involves, or your responsibilities for taking over this role.
Well, let’s clear it all up so you know what to expect and what you need to do.
First off, you need to know the treasurers chief role is to keep the books up to date, and to report to the club’s committee about the club’s finances whenever required according to the club’s constitution (or articles of association if it’s been formed as a limited company and the articles include those details).
Bookkeepers and Accountants
Second, you need to know there is a clear distinction between what a bookkeeper is responsible for and what accountants do. That is, the bookkeeper’s role is to ensure the club’s transactions are recorded, and the accountant’s role is to audit those transactions, create periodic reports, and submit tax returns (yes, clubs have to pay tax too unless they’re registered charities, and even then not everything is free of tax).
If your club can afford it, always employ a professional bookkeeper and accountant.
TOP TIP: You can often get an accountant for free if your club serves the community (and the accounts are simple) because accountants tend to value the kudos they get for doing good community work out of the goodness of their hearts (just promise them you’ll tell everyone you know how brilliant they are for helping you out).
Having said all that, it’s odds on you will be doing most of the bookkeeping and reporting yourself (and for many, even completing tax returns and submitting them are part of the job – you might want to check that with the chairperson first if you have any doubts about your role as treasurer).
But don’t panic. it’s not hard.
Using software is a very good idea, but most clubs are still run using spreadsheets to record transactions. And on the subject of software, why not try and leverage your community minded spirit to try to get the software free or at a discount using the leverage that you’ll be happy to promote the accounting software company on your club website.
A Club Treasurers Main Roles
- Recording day to day transactions
- Reporting at club committee meetings
- Ensuring year end filing is completed
- Answering questions members of your club may have
- Collecting membership fees
- Responsibility for banking
- Responsibility for paying bills
- Meeting financial deadlines
It may not include all of the above, but it may also include more. Your chairperson will usually know. Always ask so you don’t discover any surprises later on. If in any doubt, ensure (or insist) the club appoint an accountant (it doesn’t have to cost any money if you follow the advice above).
Recording Day To Day Transactions
The first rule. Know your debits from your credits. Every bookkeeping system on the planet uses the double-entry bookkeeping process (whatever claims you may have read). This is because every transaction ALWAYS affects AT LEAST TWO accounts.
Every transaction consists of at least two entries in your books. Double-entry is called double-entry because of these minimum two entries that make up a complete transaction. It has NOTHING to do with repeating the same information twice (which is a common urban myth).
If you haven’t already subscribed to the Accounting for Everyone Bookkeeping Course, you will learn everything you need to know about this tricky subject (written in simple terms, and it also includes personal help if you get stuck).
If you’re using spreadsheets to record your club’s day to day financial activities, the simplest way is to use a single spreadsheet, but broken down unto multiple tabs. That way, everything will be contained in one place, and will be far easier to manage.
You will also be able to cross reference items and produce reports more easily.
What Is a Transaction?
Each of the entries made from a transaction will need the following information as a minimum:
- Who (who paid the money or who the money was paid to)
- What (what the transaction was for)
- Amount (the total amount of the transaction
- Reference (any reference number or notes that make it easier to find the details of this transaction later)
What Should You Record In Your Treasurer’s Spreadsheet?
Here’s the minimum list of tabs you’ll need in your spreadsheet:
- Income (record every bit of money that comes into the club and break it down by category – eg. subscriptions, donations, other income)
- Payments (record every payment made and break it down by category – eg. rent, stationary, equipment, travel, miscellaneous)
- Budget (you don’t need to set a budget, but it’s a good idea to have one, as everyone will then have a rough idea of how your income will pay for known expenses or overheads)
- Profit and Loss (summarise your income on a monthly and year to date basis against your outgoings – then you’ll be ready and prepared for your club’s committee meetings)
- Assets register (if your club buys anything for use by the club that will last for more than a year, it’s called an asset, and keeping a register of your assets, when you bought them and what they cost will help you carry out inventory audits as well as forecast when they are likely to need replacing so you can more easily budget for them)
- Debtors (record a list of money owed to the club – and remember to cross them off or mark them as paid so you never lose track – this will also help you chase up people who owe the club money)
- Creditors (record bills that come in that have yet to be paid by the club – this will help ensure you have plenty of warning of any cash flow problems)
What About a Club Bank Account?
It’s a very good idea to open a bank account for the club. Make sure there are at least 2 signees (usually the treasurer and chairperson), otherwise responsibility and trust will be questioned – plus it’s best practice and will serve to protect you from insinuations and allegations.
Try to find a bank that does not charge you fees. Many have concessions in this area if you can prove you are a service to the community and not a profit making entity.
Keep all bank statements so you can show any requests about activity easily (this is one area where paper still rules the world despite our best efforts to save it – if you care about the environment, try and persuade committee members that everything can be accessed electronically these days (use Google docs to share spreadsheets, reports and even images – it costs nothing, and you just need to setup a free Google Gmail account to use it).
Where Can I Get More Help
If you are taking over the role from someone else, it goes without saying they will be a great source of knowledge, but if not, you can always access advice if you join the Accounting for Everyone Online Bookkeeping Course (it also includes a 3 part treasurers guide).