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ASHRAE Chapter Treasurer Chapter Financial Risk Management for International Chapters Financial Risk Management – Chapter Treasurer Duties – Financial Accounting & Banking – Chapter Annual Audits – Revenue and Taxation Reporting – Fiduciary Duties Chapter Treasurers • Chapter Presidents: prepare balanced budgets for approval by BOG • Treasurer shall make all deposits and issue all checks as authorized by the BOG. • Treasurer to balance monthly statements & present to BOG for review and approval; keep records. • Annual independent Audit Committee appointed by BOG; elect prior to annual Chapter meeting. Chapter Treasurers (cont’d) • Chapter account used for operations only. • Use separate account codes for special events such as CRC Fund or Scholarships. • Responsible to file tax returns – check with local tax authorities regarding status of non profit establishments. Financial Accounting and Banking • It is recommended that each Chapter have its own copy of a reputable Financial Software. • At least three Chapter officers should have signing authority. • At least two signatures are required on each check (for sums of $100 and greater or suitable equivalent local currency). Financial Accounting and Banking (cont’d) • Consider separate bank accounts for high dollar special events. • Where possible all Research Donations should be forwarded directly to ASHRAE Research. • All investments should be in safe low risk investments (i.e. bonds, term deposits). Chapter Financial Audits • Set up Audit Committee made up of Past Presidents and/or senior ASHRAE members to perform annual audit. • Larger Chapters may want to consider outside accounting firms to perform financial audits. • Chapter Treasurers should not audit books for their year. • Audit findings should be presented to Chapter BOG once per year. Revenue and Taxation Reporting • To comply all formalities with regard to filling of financial statements and tax returns with the local state tax authorities. • Income and expenditure, receipt and payment accounts for the year, to be drawn and audited by certified audit firm. Revenue and Taxation Reporting • Your tax filing is due every year by the end of the __ th day of the __th month after the close of your year end. • For most Chapters the year ends on June 30 but the Tax Filing must be completed by ___ (check with local tax office if not known). • You cannot file until after your tax year ends. Information Needed To File • Employee Identification Number (EIN) or alternatively Taxpayer Identification Number (TIN). • Tax Year. • Legal name. (ASHRAE Chapter Chartered name) • Mailing address. • Alternative name organization uses. • Name and address of principal officer. (Chapter President) • Confirmation of annual gross receipts. Late Filing or Failure to File • Chapters who fail to file tax returns risk local fines & loosing non-profit status. • They also would jeopardize the Society’s Tax Exempt Status • The Society could dissolve the chapter UNDERSTANDING FIDUCIARY DUTIES • As a Chapter Officer you have a Fiduciary duty to your ASHRAE Chapter. • The Law.com - Dictionary defines a fiduciary as a person who has the power and obligation to act for another…under circumstances which require total trust, good faith and honesty. Fiduciary Primary Duties A Fiduciary has three primary duties: • Duty of Care • Duty of Loyalty • Duty of Obedience Duty of Care • Board members must exercise reasonable care in overseeing the organizations financial and operational activities. Duty of Loyalty • Board members must act solely in the best interests of the organization and its constituents, and not for personal gain. Duty of Obedience • Board members must act in accordance with the organization’s mission, charter and bylaws, and any applicable state of federal laws. • Board members who violate these duties may be held personally liable for any financial harm the organization suffers as a result. Avoiding Conflicts of Interest • One of the most important components of the duty of loyalty is the obligation to avoid conflicts of interests. • Step aside or abstain from voting when ever there is an appearance of a conflict of interest. • Please review the ASHRAE Codes of Ethics. http://www.ashrae.org/publications/detail/14686 Can a Volunteer be Liable? • A common misconception is that volunteers are shielded from liability. In fact, though they do enjoy some protection from financial responsibility, that protection isn’t absolute. • ASHRAE Security & Privacy Policy does not apply to sites of any ASHRAE chapter, region, student branch, technical committee or other group affiliated or associated with the Society. ASHRAE Chapter Best Practice • Enjoy your participation in ASHRAE