Chapter Leader Playbook: Lay the Groundwork For Healthy Chapter Finances

When it comes to chapter finances, what you don’t know – can hurt you. Chapter finances and accounting are complex, but staying in the dark will only make things more complicated down the line. If your chapter finances aren’t healthy, it’s likely that your member’s experience is going to suffer as a result.

In thefirst post of our Chapter Leader Playbookseries, we discussed how your chapter can improve its reputation on campus and in your local community. Poor financial management can cause damage to your chapter’s image and reflect negatively on your organization. With some simple questions, you can start chipping away at the ambiguity around your chapter’s financial health.

According to Investopedia, while there are many measures of financial health, common indicators are a steady cash balance, a consistent flow of income and rare changes in expenses. Investing time to understand chapter finances can ease anxieties and make you feel confident that your chapter is headed down the right financial path to reach your programming and membership goals.

The first step to building up your financial knowledge is making sure you have a grasp on your organization’s financial procedures, policies and tools. A strong understanding of this framework will enable you to better monitor the indicators of financial health.

Depending on your organization’s financial structure, you may have a local bank account for your chapter, or a consolidated bank account set up by National. Always check with National to see what policies and procedures are in place. Below are a few questions to get you started, based on your chapter’s bank account structure:

 

IF YOUR CHAPTER HAS A CONSOLIDATED BANK ACCOUNT:
  • Do you or someone at the chapter have access to review your accounts? Who should you get in touch with at National to gain access to your chapter’s account?
  • Is there access to training to learn the financial management system that National is leveraging?
  • Do you understand the spend approval process?
  • Is it clear what reports from the financial management system would be helpful for chapter officers to review?
  • Are available expense management options and processes clearly outlined to reduce member and/or chapter officer reimbursements?

 

IF YOUR CHAPTER HAS A LOCAL BANK ACCOUNT:
  • Are you, as chapter leader, required to have a signor from National on the account? If so, who should you contact at National?
  • Are there any approvals that chapter leaders or volunteers need to be aware of to cut checks or set up payments?
  • Are there any chapter credit card policies or procedures you should be aware of?
  • How should chapter leaders send required reporting to National?
  • How frequently do you need to send reporting to National?
  • What information should reports sent to National include? (e.g. bank statements, etc.)
  • If chapters collect funds (dues, event registrations, etc.), is it clearly stated how any dollars owed to National by the chapter should be paid?
  • How should you, as a chapter leader, reimburse members or other officers who front money for the chapter?

 

UNDERSTAND YOUR CHAPTER’S DUES FRAMEWORK

A steady flow of income is important to sustaining your chapter’s operations. A majority of your income will come from chapter dues. While the chapter dues process is notoriously complicated, it doesn’t have to be. Start at the foundation so you can better facilitate and answer questions on the dues process. Use clarifying questions like the ones below to understand your chapter’s responsibility in the process:

  • Does National provide technology to enable you to collect funds, or do you need to build your own infrastructure to do so?
  • Is there training or resources available for your officers responsible for collecting dues?
  • Is there specific messaging you should be using to communicate the benefits members receive with their chapter dues and/or their National dues?
  • Do you need to transfer National dues to National and if so, how often?
  • Are the items you need to invoice for clear and easy to explain?

If you feel in the dark about processing dues, asking questions can help when the inevitable hiccups arise. Challenges in the dues process can impact your time and budget, but should not be cause for panic. Keeping in communication with National regularly when questions arise will enable you to identify problems and discuss solutions sooner. If your organization offers conference lines or webinars for chapter leaders, consider joining them. This is a great time to share any pain points you’ve come across with the process. Communication is key to evolving the dues process.

 

MAKING LIFE EASIER FOR NATIONAL

If you are facing challenges at a chapter level, it’s important to keep perspective that National is likely facing them at a larger scale. This can be helpful in the sense that it allows you to leverage their experiences and solutions. It also means that you can help alleviate National’s stress by keeping organized and having strong communication. Consistency is key, so asking for a dues template is a great way to ensure everyone is on the same page. Having a positive relationship with National will only benefit you further down the line.

Chapter leaders need to keep an eye on finances to run and grow a successful chapter. Chapter finances and dues are an integral part of chapter operations, understanding them should not just fall to a Chapter Treasurer. All chapter leaders should take it upon themselves to understand the financial and dues framework. In the next post in our Chapter Leader Playbook, we discuss how all officers should be involved in running an efficient and transparent election process.

About the author

Charlotte Muylaert is the former Marketing Leader at Billhighway and greekbill. She oversaw the marketing and branding strategies for 10 years in the fraternal and association markets.