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 > Little League Online > Media > Little League News Archive > 2009 > January - April > Tips from the Treasurer: Protect Your League, and Yourself, from Financial Problems

Tips from the Treasurer: Protect Your League, and Yourself, from Financial Problems

Tips from the Treasurer: Protect Your League, and Yourself, from Financial Problems

Melissa Singer Melissa Singer was elected Treasurer of Little League Baseball and Softball in 2002, by the Little League International Board of Directors. Prior to that, she was Controller at Little League International since 1998.

In every local Little League, a great amount of well-deserved trust is placed in volunteers.

In all instances, volunteers are expected to do the right thing – whether it is ensuring players on an All-Star team are eligible, ensuring the managers and coaches have passed the background check, or ensuring the money raised for the benefit of the children in the league is wisely spent.

And in a vast majority of leagues, volunteers make the right choices in these examples and all others at the local level. They must, because the volunteer is, in fact, the bedrock of Little League.

But sometimes – particularly during a difficult economic period – even those in whom we place so much trust can be lured into doing the wrong thing.

Every season, local Little Leagues raise funds to cover the costs of operating their leagues, but in recent months Little League International has noticed more stories in the media regarding missing funds at local non-profits such as Little Leagues.

The tips below are designed to help your league, and you as a key volunteer, avoid these problems, as well as avoiding the taint of suspicion should anyone question if money is missing.


Fund Raisers, Concessions and Other Income

Car washes, candy sales, decal sales, concession sales and raffles are staples of the typical local Little League fundraising plan. Leagues also have relied on the kindness and trust of local sponsors and the generosity of parents and fellow Little League volunteers to help keep leagues financially solvent.

“Every year, we hear from leagues in financial hardship because something happened behind the scenes that no one had any idea about,” Melissa Singer, Little League International Treasurer, said. “What’s disappointing is its so easy to place simple procedures in place to protect your league.”

An organization’s size, location and financial status seem to have no bearing on the incidents of missing funds. What does appear to be consistent is the lack of oversight and relaxed attitude that some organizations take with regard to fundraising.

“The biggest problem is leagues have a limited number of volunteers who are already stretched for time, because they’re doing so many different tasks,” Mrs. Singer, a former Secretary and Audit Committee Member for her local Little League, said. “It doesn’t matter how trustworthy you think a person is. You’ll never fully know their personal situation, and what reason that person would have to rationalize stealing from a league.

“When people question a league’s fundraising records, it can be as bad as being robbed,” Mrs. Singer said. “Take the extra time to ensure all receipts are accounted for properly by creating procedures that have multiple people counting money. Even if it’s at the end of the night, after the last game, two or more people should count the money.”

Having more than one person counting money is for the protection of both the league and the individuals who are counting it. And, Mrs. Singer added, the people who are counting the money should not be related to each other.

“Everyone should know that leagues should do this NOT out of suspicion, but out of a sense of responsibility” she said. “It is to protect the integrity of all of those involved, and in Little League and life, integrity is what matters most.”


Leadership of the Local League

The positions of President and Treasurer on a local board of directors are critical to the operation of a non-profit organization, but they also come with great responsibility – and some temptation too.

 “The responsibilities of Treasurer cannot be placed solely with one person,” Mrs. Singer said. “Leagues need transparency so Treasurers can protect themselves. One way is by having checks that require two signatures. Also, the two board members with access to the league’s accounts should never be related to each other.”

Personal ethics and accountability are equally important when electing board members. Each person volunteering for these positions does so of their own free will, and it must be assumed that their motivation is to see the league not only survive, but to prosper.

“All leagues need a Treasurer, but everyone who volunteers in a league must remember that the funds used by the league are inevitably dedicated to the children in that league,” Mrs. Singer said. “There has to be several people counting the money, and as a parent or a league volunteer, I would want many people checking the paperwork to make sure every penny is accounted for.”

This also is another great reason to conduct a full criminal background check on the board members and anyone else involved in fundraising. Little League regulations call for, at a minimum, a national background check that will uncover those listed on a sex offender registry.

But what about a conviction for embezzling?

Conducting a national criminal background check through ChoicePoint can uncover these convictions and may prevent an ugly situation. The best part is, the first 125 checks done by a local Little League are FREE, and only $1 per check after that. Normally, it costs as much as $20 per check.

This is just one more benefit Little League offers to its local leagues – something no other national youth sports organization can hope to match.


Audit Committee

The board itself must shoulder some responsibility as well.

“The board of directors should set up an audit committee to review and verify receipts,” Mrs. Singer said. “In the normal course of the season there are normally three major sources of revenue – registration, concessions, and a large fundraiser. The audit committee should look over the books at least on a monthly basis for those times when most of the income is being produced.”

The few minutes spent by an audit committee can save hundreds of hours of headaches.

“Raising money is vital to keeping a Little League running,” Mrs. Singer said. “If leagues don’t audit themselves it can break them. Keeping good financial records shows the monies generated and explains how it was used. A backup ledger or spreadsheet for operating costs also gives leagues a second point of reference that details all revenues and expenses that can be used to validate financial statements.”


More Information

A description of the suggested “Local League Accounting Procedure,” and “Local League Accounting Records,” are available on Pages 37-40 of the 2009 Little League Baseball and Softball Operating Manual. That information also is provided below:

LOCAL LEAGUE ACCOUNTING PROCEDURE

Funds raised anywhere in the name of Little League constitute a valid trust.

Sources (revenues) and uses (expenses) of funds raised must be recorded properly and appropriate actions taken to safeguard these funds. In order to help local leagues set up and maintain financing records, the following accounting procedure has been prepared and is offered as a guide. It is suggested that every league adopt a plan or some reasonable modification of this procedure to suit circumstances of local administration.

It is the responsibility of a league’s board of directors to require its Treasurer to keep accurate financial records and make adequate financial reports monthly, and a final report once a year at the close of the fiscal period.

Effective at the end of the current fiscal year (normally September 30), each league will furnish the District Administrator and Little League International with a copy of the annual financial report. The financial report must show receipts and payments for the year and the financial status of the league at the close of the fiscal period.

It is recommended that the league secure the services of a Public Accountant to set up such books and records and assist the Treasurer in the proper recording of transactions and the preparation and audit of financial reports.

All funds received must be deposited in a bank account; all payments must be by check. Two signatures are required on each check - that of the Treasurer and that of another officer or director.

To assist in setting up audit records for the league, the following chart of accounts and sample statements are suggested. It may be desirable to expand the chart of accounts if the league wishes to break down the items by Major, Minor, Junior, Senior and Big League Baseball and Little League, Junior, Senior and Big League Softball operations. Leagues that have no property will delete those accounts that do not apply to their operation.

SAMPLE CHART OF ACCOUNT FOR LOCAL LITTLE LEAGUE ACCOUNTING RECORDS

Current Assets:
Checking Account
Savings Account
Petty Cash

Fixed Assets:
Land
Buildings and Improvements
Field Equipment
Concession Equipment
Office Equipment

Deferred Charges:
Playing Equipment & Supplies
Concession Supplies

Current Liabilities:
Accounts Payable
Notes Payable
Interest Payable
Taxes Payable

Fixed Liabilities:
Mortgage Payable
Other

Income:
Sponsor Fees
Collections at Games
Advertising
Accounts Receivable
Concessions
Fund Raising Projects
Other

Expense:
Baseball/Softball Equipment & Supplies
Field Equipment & Supplies
Utilities (water, electricity, gas, concession equipment, telephone)
Rent
Maintenance and Repairs
Office Expenses - Administrative
Concession Expense
Interest
Taxes
Depreciation
Background Check Fees
Miscellaneous
Charter Fee
Insurance
Tournament Entry Fee

Net Worth:

NOTES:

Accounts, as applicable, should be sub-divided to show income and/or expenses for softball and baseball in the Tee Ball, Major, Minor, Junior, Senior, Big League and Challenger Division operations.

Insurance should be sub-divided to show: Accident, Liability, Crime, Directors and Officers Liability and locally purchased insurance against fire, flood, property theft, etc.

Equipment and Supplies: Uniforms and patches, baseballs, softballs, bats, etc.

Field Equipment and Supplies: Bases, tools, stands, scoreboards, etc.
Maintenance and Repairs: Field, buildings.

Concession Expense: Food and beverages, novelties and merchandise, etc.
Office Expense: P.O. Box rent, stationery, postage, etc.

Miscellaneous: Legal, tournament, background check fees, awards (pins, pictures, certificates), etc.

STATEMENT OF INCOME AND EXPENSE FOR THE FISCAL YEAR ENDING 20______ IN THE __________________ Baseball/Softball Division.

Income
Sponsor Fees............................$_____
Collection at Games.....................$_____
Advertising (fence, scoreboard, etc.)...$_____
Concessions.............................$_____
Fund Raising Projects...................$_____
Other...................................$_____
TOTAL INCOME............................$_____

Expense
Charter Fee.............................$_____
Insurance...............................$_____
Baseball Equipment and Supplies.........$_____
Field Equipment and Supplies............$_____
Utilities...............................$_____
Rent of Property........................$_____
Maintenance and Repairs.................$_____
Concession Expense......................$_____
Office Expense..........................$_____
Interest and Taxes......................$_____
Depreciation............................$_____
Miscellaneous...........................$_____
Background Check Fees...................$_____
Tournament Fee..........................$_____
Total Expense...........................$_____
Surplus or Deficit......................$_____

STATEMENT OF ASSETS AND LIABILITIES AS OF 20_____

Current Assets:
Checking Account........................$_____
Savings Account.........................$_____
Petty Cash..............................$_____
Accounts Receivable.....................$_____
TOTAL CURRENT ASSETS....................$_____

Fixed Assets:
Land....................................$_____
Buildings and Improvements..............$_____
Field Equipment.........................$_____
Concession Equipment....................$_____
Office Equipment........................$_____
TOTAL FIXED ASSETS......................$_____

Deferred Charges:
Uniforms, Bats, Baseballs...............$_____
Concession Supplies.....................$_____
TOTAL DEFERRED CHARGES..................$_____
TOTAL ASSETS............................$_____

Current Liabilities
Accounts Payable........................$_____
Notes Payable...........................$_____
Interest Payable........................$_____
Taxes Payable...........................$_____
TOTAL CURRENT LIABILITIES...............$_____

Fixed Liabilities:
Mortgage Payable........................$_____
TOTAL LIABILITIES.......................$_____
NET WORTH...............................$_____