JOHNSTON COUNTY PUBLIC SCHOOLS INTERNAL AUDIT DEPARTMENT PTA, PTO AND BOOSTER CLUB HANDBOOK

JOHNSTON COUNTY PUBLIC SCHOOLS INTERNAL AUDIT DEPARTMENT 2017-2018 PTA, PTO AND BOOSTER CLUB HANDBOOK

Table of Contents Organization Guidelines 3 Financial Guidelines 3 Fundraiser Guidelines 4 Treasurer Job Duties 5 Sample Forms: Sample Bank Reconciliation 6 Sample Check/Payment/Order Request Form 7 Sample Deposit Reconciliation Report 8 Sample Concession Sales Report 9-10 Sample 50/50 Raffles Procedures 11 Sample Ticket Sales Report 12-13 Board Policies: Policy Code: 2020 Parent Organizations 14-15 Policy Code: 2025 Booster Clubs 16-17 Policy Code: 7230 Sales and Solicitations 18-19 Policy Code: 7240 School-Related Organizations-Funds Management 20 Annual Review Checklist/Scope 21 JCPS Internal Auditor s Contact Information 22 Johnston County Public Schools 2017-2018 PTA, PTO and Booster Club Handbook Page 2 of 22

PTAs, PTOs and Booster Clubs with Johnston County Public Schools PTAs, PTOs and Booster Clubs are vital support groups for Johnston County Public Schools. These organizations involve parents that support a particular club or school. They are led by parents, NOT by Johnston County Public School employees. These organizations ARE NOT considered a part of the school system and funds for the organization are not handled by the individual schools. Because the organizations and their activities reflect upon the school system, guidelines are provided stating conditions in order to operate on behalf of the schools. These guidelines are addressed in Board Policy 2020 Parent Organizations, Board Policy 2025 Booster Clubs, and Board Policy 7240 School-Related Organizations Fund Management. A copy of these policies is provided in this HANDBOOK. Individual school PTAs are members of the state PTA organization, which has developed a charter and filed necessary legal papers to qualify as tax-exempt. Each PTA shall have their own federal tax identification number from the Internal Revenue Service and become incorporated with the NC Secretary of State. PTOs and Booster Clubs must be tax-exempt, nonprofit corporations. Nonprofit corporations are created by filing the appropriate documents with the NC Department of the Secretary of State. Application for federal taxexempt status must be made with the Internal Revenue Service. Application for state tax-exempt status must be made with the NC Department of Revenue. Organization Guidelines The organization shall file a copy of its approved organizing paperwork and provide the tax identification number with the principal at the school the organization supports. IN NO CASE SHOULD THE ORGANIZATION USE THE TAX ID NUMBER OF THE BOARD OF EDUCATION. Each organization shall be furnished with Board of Education Policies 2020 Parent Organizations, 2025 Booster Clubs, 7230 Sales and Solicitations, and 7240 School-Related Organizations Funds Management. A copy of these policies is provided in this HANDBOOK. The organization shall submit in writing to the principal the intent of the organization for approval by the superintendent. Each organization must establish a slate of officers with at least a president, secretary and treasurer. Financial Guidelines Sound accounting practices and good internal controls shall be put in place by the organization. Each organization shall open a checking account in the name of the organization. The President and Treasurer shall BOTH be on the checking account and TWO signatures shall be REQUIRED on all disbursements (no debit cards). Revolving charge accounts (credit cards or store accounts) must be established in a way or manner that the bank or business extending credit knows and understands that neither the school nor the school system has any financial responsibility for the payment of any obligations incurred by the club or association on the account. Johnston County Public Schools 2017-2018 PTA, PTO and Booster Club Handbook Page 3 of 22

Job descriptions shall be established to identify job duties. The descriptions shall provide for internal controls, to ensure several people are involved in the process. This is very important when handling money. A job description for treasurer is included in this HANDBOOK. A monthly financial report shall be prepared by the treasurer and reviewed by the president and other officers. The report shall be presented at membership meetings and always available for members to review. A copy of the monthly report shall also be provided to the principal of the school. Sales taxes may need to be paid by the organization to the NC Department of Revenue. More information can be obtained from the NCDOR at 1-877-252-3052 or by visiting the website at www.dornc.com. Bank statements shall be reconciled monthly, with copies provided to all officers and principals and made available to members. A sample bank reconciliation form is included in this HANDBOOK. The president and treasurer shall both sign the bank statements or attached bank reconciliation forms upon completion of the monthly reconciliations. All accounts are required to be reviewed annually by an outside entity (an entity outside the organization that is qualified to perform this compliance testing/agreed upon procedures engagement according to the scope approved by the Board). The outside entity does not have to be a paid preparer. A report of the review (containing the required checklist) shall be filed with the principal and the school system s internal auditor by October 1 for the preceding fiscal year ended June 30. Financial records shall be subject to review by the principal or internal audit department upon request. Failure to provide a timely review report or failure to provide financial records upon request may result in suspension or disbanding of the organization. Fundraiser Guidelines Organizations must obtain approval from the principal for any fundraising event. Board of Education Policy 7230 Sales and Solicitations provides guidelines for fundraisers. A copy is located in this HANDBOOK. If products are sold, shipments shall be carefully inventoried to make sure all items are received before products are distributed. When an organization distributes products at the school, products shall be secured at all times (as cash would). Refund policies shall be clearly outlined when products are sold. Bingos and Raffles shall be conducted in compliance with state laws. These activities are governed by NC General Statutes 14-309.5 through 14-309.15. The organizations can find these laws at www.ncleg.net. Johnston County Public Schools 2017-2018 PTA, PTO and Booster Club Handbook Page 4 of 22

Treasurer Job Duties 1. The treasurer is the person with fiduciary responsibility for the clubs funds. This means the funds are not owned by this person but this person maintains the bookkeeping function for these funds that belong to the organization. 2. Good internal control practices shall be followed and include: a. Never sign a blank check. b. Two signatures are required on every check. c. All expenditures shall be made by check or electronic payments (no debit cards). Purchases shall NEVER be made with cash. d. Strong internal controls shall be used to ensure proper use of revolving charge accounts (credit cards or store accounts). Charge accounts shall be used for the organization s use only (never for personal expenses). A receipt from all charges must be submitted to the treasurer in a timely manner, stating the purpose of the charge and the name of the person who made the purchase. Charges for alcohol will not be approved under any circumstances and will become a personal responsibility of the cardholder. All charges must adhere to the approved budget and prior approval from the organization s president is required for all purchases. Credit limits shall be reviewed by officers each year. Credit cards shall be kept in a secure location. Names of authorized users shall be approved by current officers. e. A checking account with the organization s name shall be used. Never deposit any money into a personal account. f. The organization s funds shall be kept separate from all other funds (including the school s funds). g. Maintain complete records including bank statements and images of cancelled checks. h. At the end of the treasurer s term, all records shall be in balance and all bills shall be paid. If there is a treasurer change mid-year, a review shall be performed by a three-member committee (no officers) before the next treasurer takes over the books. Even if a mid-year review is performed due to a treasurer change, the organization is still required to submit an annual review by October 1st (performed by an outside entity). However, if the treasurer changes effective July 1st, the annual review of the previous fiscal year (performed by an outside entity) is the only review necessary. 3. The following files shall be maintained: a. Receipt Book or Log- If money was collected from a person (catalog orders, etc.), then a receipt book or log shall be maintained. The receipt book/log shall list the person s name, date money was collected, amount of money collected, and the purpose of the money. If money was collected from a group of people (bake sale, car wash, concession sales, etc.), then two people shall count all the money immediately after the fundraiser ends. A deposit reconciliation report or concessions sales report shall be completed and signed by two people. In either case, the treasurer verifies the funds and makes a deposit to the bank within one business day. The bank deposit slip shall be attached to the deposit reconciliation report or concessions sales report and both the president and treasurer shall sign this report. b. Checks/Electronic Payments- A form shall be used to request funds from the treasurer. This form (commonly called a voucher or check request) shall list the amount, the person s/vendor s name the check shall be made payable to and the approval signature of the president. A sample check request form is included in this HANDBOOK. The form includes a description and shall always have some type of supporting documentation such as invoices, contracts or receipts attached as proof of the purchase. The treasurer receives the request and then gives it to the president to approve. Once the president has approved the request, the treasurer can write the check/process the electronic payment. This provides for a check and balance system so that one person does not have control of these funds. Johnston County Public Schools 2017-2018 PTA, PTO and Booster Club Handbook Page 5 of 22

SAMPLE BANK RECONCILIATION Organization s Name: Statement Month: 1) Bank Statement Ending Balance 2) Add outstanding deposit(s) (not listed on this statement) 3) Add total of lines 1 and 2. 4) Deduct outstanding check(s)/payments (not listed on this statement) 5) Deduct debits such as bank charges and NSF checks 6) Ending Balance (Subtract lines 4 & 5 from line 3.) This should match your current checkbook balance. : Outstanding Deposits/Credits Amount Check Number: Outstanding Checks/Debits Amount Total Amount: Total Amount: I certify the above information is correct Treasurer s Signature President s Signature Johnston County Public Schools 2017-2018 PTA, PTO and Booster Club Handbook Page 6 of 22

Sample Check/Payment/Order Request Form Check # (Treasurer will enter #) Check/Electronic Payment Payable to: : Vendor s Address: Vendor s Phone Number: Amount: $ Check/Payment/Order is Needed: Reason for Request: Check/Payment/Order Requestor: Requestor s Signature Return Check to Individual or Mail Directly: Individual Mail Directly Mailed INVOICE AND/OR RECEIPT MUST BE ATTACHED TO CHECK/PAYMENT REQUEST FORM APPROVED BY: (Two signatures required on Check/Payment Request Form & Check) Treasurer s Signature President s Signature --------------------------------------------------------------------------------------------------------------------------------------- If returning check to individual, complete this section when individual receives check: Check Number: Check : Individual s Signature Acknowledging Receipt of Check Johnston County Public Schools 2017-2018 PTA, PTO and Booster Club Handbook Page 7 of 22

Sample Deposit Reconciliation Report Money Was Collected: Reason Money Was Collected: Cash Box Startup Amount (if applicable): $ Signature of Person Who Verified Startup Cash Box Amount: (this should not be the same person who set up the cash box) Total Checks: Total Cash: Total Coins: $ $ $ TOTAL FUNDS COLLECTED: $ (this should equal the total on the deposit slip from the bank) Less Startup Cash Box Amount: $ (if applicable) Total Profit for Event: $ Signature of Money Counter #1 Signature of Money Counter #2 Signature of Treasurer (if not one of the money counters listed above) Signature of President (if not one of the money counters listed above) *Deposit slip from bank should be attached to this form. Johnston County Public Schools 2017-2018 PTA, PTO and Booster Club Handbook Page 8 of 22

SAMPLE CONCESSION SALES REPORT (ALL information and signatures should be legible) : Event: Beginning Change Fund Amount: Signature of Organization s President/Designee (Above information completed by organization s treasurer, verified and signed by organization s president/designee) CONCESSION ITEMS CHECKLIST (Below information completed by Sponsoring Organization s President/Designee/Seller) General Description of Items Sold Quantity Sold Cost Per Item Total Collected Per Item Total Collected for All Items Sold SETTLEMENT OF CONCESSIONS SOLD AND TOTAL FUNDS COLLECTED (Completed by Organization s President & Sellers) A. Total Collected for All Concession Items Sold $ B. Total Collected for Concession Items Sold and Change Fund $ (Starting change fund amount + amount on line A) C. Total Checks in Cash Box (Checks only) $ D. Total Currency (Cash) in Cash Box (Cash only) $ E. Total Coins in Cash Box (Coins only) $ F. Total Checks, Cash and Coins Turned In (Add lines C, D & E) $ G. Less Total Concessions Sold and Change Fund (Total on line B) $ H. Difference (Over/Short) (F G = H) $ Reason for Difference: Signatures Verifying Settlement Information (including final counting out of cash box): Signature of Seller #1 Signature of Seller #2 Signature of Organization s President/Designee RECEIPT OF TOTAL FUNDS COLLECTED Signatures Verifying Receipt and Deposit Totals the Following School Day/Day of Deposit (review reconciliation for accuracy and verify cash box in the presence of Organization s President): Signature of Organization s Treasurer Signature of Organization s President Johnston County Public Schools 2017-2018 PTA, PTO and Booster Club Handbook Page 9 of 22

INSTRUCTIONS FOR CONCESSION SALES REPORT AND CASH HANDLING PROCEDURES: 1. This form is to be completed the day of the event by the appropriate people listed on each section of the report. 2. The event and date should be entered indicating what function the concessions were sold. 3. The treasurer will complete the Concession Sales Report Change Fund Verification section of the form indicating the amount of the change fund provided to the organization s president/designee or seller(s). 4. The organization s president/designee or seller(s) will count out the change fund in the presence of the treasurer, and sign the form indicating acceptance and acknowledgment of money received. 5. The organization s president/designee and seller(s) will complete the Settlement of Concessions Sold and Total Funds Collected section of the form. A. Indicate the total collected for all concession items sold on line A; B. Add total collected for concession items sold and change fund amount together on line B; C. Add total amount of checks and enter on line C; D. Add total amount currency (cash only) and enter on line D; E. Add total amount of coins and enter on line E; F. Add total checks, cash, & coins and enter on line F (C + D + E = F); G. Insert amount from line B on line G; H. Calculate any overage/shortage (F G = H); 6. The organization s president/designee and seller(s) will explain the reason for any overage or shortage and all these people should sign this section. 7. The treasurer will review the reconciliation for accuracy. The treasurer will also verify total funds collected in the presence of the organization s president. Both the treasurer and president should sign and date this section. 8. Any changes to the form are to be initialed by the person making the change. 9. All funds should be secured and deposited the next business day. Optional counting form: Checks 100 s 50 s 20 s 10 s 5 s 2 s 1 s Total Amount of Cash 0.25 0.10 0.05 0.01 Total Amount of Coins Johnston County Public Schools 2017-2018 PTA, PTO and Booster Club Handbook Page 10 of 22

Sample 50/50 Raffle Procedures The following procedures should be followed when PTA, PTO or Booster Club sponsors a 50/50 raffle: 1. The organization should purchase a roll(s) of numbered tickets. 2. The organization s treasurer will complete the Ticket Checkout and Change Fund Verification section of the Ticket Sales Report. The treasurer will indicate the ticket color(s), the first and last ticket numbers on the ticket roll(s), and amount of the change fund provided to the organization s president/designee or seller(s). 3. The organization s president/designee or seller(s) will verify the ticket numbers, count out the change fund in the presence of the treasurer, and sign the top portion of the Ticket Sales Report indicating acceptance and acknowledgment of money received. 4. At the end of the fundraiser, the organization s president/designee and seller(s) will complete and sign the Settlement of Tickets Sold and Total Funds Collected section of the original Ticket Sales Report. 5. A note shall be written on the ticket sales report stating that half the money collected was given away as prize money. The following information shall be included in the note: winner s name, address, phone number, amount received, and a signature to show receipt of the prize money. 6. The organization s treasurer and president shall sign the bottom portion of the report after reconciling the tickets and total money collected. The money shall be secured and deposited the next business day. 7. This ticket sales report shall be kept with the deposit information. (This procedure was approved by Dr. Ross Renfrow on 9-14-15.) Johnston County Public Schools 2017-2018 PTA, PTO and Booster Club Handbook Page 11 of 22

SAMPLE TICKET SALES REPORT (ALL information and signatures should be legible) Sponsoring Organization: Event: : TICKET CHECKOUT AND CHANGE FUND VERIFICATION (Completed by organization s treasurer, verified and signed by organization s president/designee/seller) Ticket Color(s): Change Fund Amount: $ Ticket Numbers: through 1 st Ticket Number on Roll (note color if more than one) Last Ticket Number on Roll (note color if more than one) Verified Receipt of Above Tickets and Change Fund: Signature of Organization s President/Designee/Seller SETTLEMENT OF TICKETS SOLD AND TOTAL FUNDS COLLECTED (Completed by Organization s President/Designee & Sellers) Tickets Sold: through 1 st Ticket Number Sold Last Ticket Number Sold A. Number of Tickets Sold: @ $ = $ (Remember to add 1 when calculating number of tickets sold) B. Total Value of Tickets Sold and Change Fund $ (Starting change fund amount + amount on line A) C. Checks Amount in Cash Box (Checks only) $ D. Currency Amount in Cash Box (Cash only) $ E. Coins Amount in Cash Box (Coins only) $ F. Total Checks, Cash and Coins in Cash Box (Add lines C, D & E) $ G. Less Total Tickets Sold and Change Fund (Total on line B) $ H. Difference (Over/Short) (F G = H) $ Reason for Difference: Signatures Verifying Settlement Information (including final counting out of cash box): Signature of Seller #1 Signature of Seller #2 Signature of Organization s President/Designee RECEIPT OF TOTAL FUNDS COLLECTED Signatures Verifying Receipt and Deposit Totals the Following School Day/Day of Deposit (review reconciliation for accuracy and verify cash box in the presence of Sponsoring Organization s President): Signature of Organization s Treasurer Signature of Organization s President Johnston County Public Schools 2017-2018 PTA, PTO and Booster Club Handbook Page 12 of 22

INSTRUCTIONS FOR TICKET SALES REPORT AND CASH HANDLING PROCEDURES: 1. This form is to be completed the day of the event by the appropriate people listed on each section of the report. 2. The event and date shall be entered indicating what function the tickets were sold. 3. The treasurer will complete the Ticket Sales Report Change Fund Verification section of the form indicating the ticket color(s), the first and last ticket numbers on the ticket roll(s), and amount of the change fund provided to the sponsoring organization s president/designee or seller(s). 4. The sponsoring organization s president/designee or seller(s) will verify the ticket numbers, count out the change fund in the presence of the treasurer, and sign the form indicating acceptance and acknowledgment of money received. 5. The sponsoring organization s president/designee and seller(s) will complete the Settlement of Tickets Sold and Total Funds Collected section of the form. A. Indicate the tickets sold (Insert 1 st ticket number sold & last ticket number sold); B. Indicate the total number of tickets sold (last ticket number 1 st ticket number + 1) and the purchase price; C. Multiply the total number of tickets sold by the purchase price to calculate the total amount sold (A on form); D. Add the amount calculated above (A on form) to the change fund amount (B on form); E. Add total amount of checks (C on form); F. Add total amount of currency (cash only) (D on form); G. Add total amount of coins (E on form); H. Add total checks, currency, and coins (C + D + E = F on form); I. Insert amount from line B on line G; J. Calculate any overage/shortage (F G = H on form); 6. The sponsoring organization s president/designee and seller(s) will explain the reason for any overage or shortage and all these people should sign this section. 7. The treasurer will review the reconciliation for accuracy. The treasurer will also verify remaining tickets and total funds collected in the presence of the sponsoring organization s president. Both the treasurer and president should sign and date this section. 8. Any changes to the form are to be initialed by the person making the change. 9. All funds shall be secured and deposited the next business day. Optional counting form: Checks 100 s 50 s 20 s 10 s 5 s 2 s 1 s 0.25 0.10 0.05 0.01 Total Amount of Cash Total Amount of Coins Johnston County Public Schools 2017-2018 PTA, PTO and Booster Club Handbook Page 13 of 22

Policy Code: 2020 Parent Organizations Principals The board encourages the development and participation of parent organizations that support the goals of the board and the schools. The board also supports parent organizations as an effective means of actively involving parents in the schools. The superintendent and school officials are expected to educate such organizations on the goals of the board and individual schools, especially as it relates to improving student success. The superintendent and school officials also are expected to help such organizations in identifying opportunities to assist the schools in meeting these goals. Conditions For Establishment And Continual Operation Of Parent Organizations Parent organizations, including PTAs and PTOs, are not considered a part of a school district. However, because the organizations and their activities reflect upon the school district, all parent organizations must accept the following conditions in order to operate on behalf of the schools. The superintendent will approve the establishment of parent organizations. PTAs are members of the state organization, which has developed a charter and filed necessary legal papers to qualify as tax-exempt. Both PTAs and PTOs shall file forms N-01 (Articles of Incorporation) and N-14 (tax exempt form) with the NC Secretary of State in order to become a nonprofit corporation. Articles of Incorporation bylaws must provide for the distribution of club assets to the school or school system and not to the officers or members of the club in the event of the dissolution of the organization. The PTO must be a tax-exempt, nonprofit corporation with necessary papers being filed with the Internal Revenue Service and the NC Department of Revenue. All parent organizations must provide the superintendent and the principal with a document describing the purpose of the organization and the general rules and procedures by which it will operate. Any modifications also must be shared in writing with the superintendent and the principal. Parent organizations must obtain prior approval from the principal for (1) any fundraising event, (2) any purchase for the school, (3) any function involving the participation of students, or (4) any event which is likely to reflect upon the school or school district. When making purchases of items, the club or association shall notify the vendor or suppliers, in writing, that the club or association and not the school or school system is the purchaser and that neither the school nor the school system shall accept any responsibility for the payment of the invoice or purchase price of the items sold. Bank accounts should reflect the official name of the club or organization and carry the tax ID number of the club or organization. In no case may the school system's tax ID number be used on a PTA/PTO bank account. Bank accounts and revolving charge accounts, if any, of the club or association must be established in such a way or manner that the bank or business extending credit knows and understands that neither the school nor the school system has any financial responsibility for the payment of any obligations incurred by the club or association on the account. Parent organizations are responsible for maintaining their own financial records. All accounts are required to be reviewed annually by an outside entity. A report of the review shall be filed with the principal and the school system's internal auditor by October 1 for the preceding fiscal year ended June 30. Employees of the school are not permitted to routinely manage the affairs of parent organization during the workday. Financial records shall be subject to review by the principal or superintendent's staff, upon request. Failure to provide a timely review report or failure to provide financial records upon request may result in suspension or disbanding of the organization. Johnston County Public Schools 2017-2018 PTA, PTO and Booster Club Handbook Page 14 of 22

The internal audit department will provide a handbook with guidelines and suggested practices for financial record keeping and club operation. It is required that club or association use the school's address as its business address to maintain the continuity of club or association records. Parent organizations are expected to take into consideration the cultural diversity and economic differences of students and parents in planning various functions. All parent organizations will follow state and federal guidelines with regards to fundraisers and tax requirements. After proper organization, should a PTA or PTO fail to adhere to the established guidelines, rules and regulations of the organization or fail to act in a manner consistent with the educational purposes for which it was established, the principal with the approval of the superintendent may suspend or disband the organization. The Board of Education accepts no responsibility or any liability for actions or financial/contractual obligations or any other cause of actions of the organization. All items purchased by parent organizations or booster clubs for a school or school use become the property of the Johnston County Board of Education if accepted by the Johnston County Board of Education. Adopted: June 14, 2005 Amended: May 12, 2015; May 10, 2016; June 13, 2017 Johnston County Public Schools Johnston County Public Schools 2017-2018 PTA, PTO and Booster Club Handbook Page 15 of 22

Policy Code: 2025 Booster Clubs Introduction All booster clubs and similar associations which are organized for the purpose of improving, developing and supporting extra-curricular activities or programs of any school must be authorized and approved, in advance by the principal, subject to the review of the Superintendent, or his designee, in accordance with the criteria set forth in this policy. Booster clubs which are not approved by the school system may not use the name of the school in the name of the organization. Conditions for Establishment and Continual Operation of Booster Clubs A copy of the booster club or association's Articles of Incorporation and/or copy of its bylaws must be submitted to the principal for review and approval by the superintendent. The principal shall retain a copy for the school records. 1. The club or association must be a nonprofit, tax-exempt corporation or association, with necessary papers being filed with the Internal Revenue Service, NC Department of Revenue, and the NC Secretary of State. 2. Its Articles of Incorporation or association bylaws must provide for the distribution of club assets to the school or school system and not to the offices or members of the club or association in the event of the dissolution of the club or organization. Booster Clubs must obtain prior approval from the principal for (1) any fund-raising event, (2) any purchase for the school, (3) any function involving the participation of students, or (4) any event which is likely to reflect upon the school or school district. When making purchases of items, the club or association shall notify the vendor or suppliers, in writing, that the club or association and not the school or school system is the purchaser and that neither the school nor the school system shall accept any responsibility for the payment of the invoice or purchase price of the item sold. Bank accounts should reflect the official name of the club or organization and carry the tax ID number of the club or organization. In no case may the school system's tax ID number be used on a booster club or organization's bank account. Bank accounts and revolving charge accounts, if any, of the club or association must be established in such a way or manner that the bank or business extending credit knows and understands that neither the school nor the school system has any financial responsibility for the payment of any obligations incurred by the club or association on the account. The club will provide for an annual review of the financial books and records of the club or association by an outside entity. Copies of the review shall be filed with the principal and the school system's internal auditor by October 1 for the preceding fiscal year ended June 30. A copy shall also be provided to the organization being reviewed. Financial books shall be subject to review by the principal or superintendent's staff upon request. Failure to provide a timely review report or failure to provide financial records upon request may result in suspension or disbanding of the organization. The internal audit department will provide a handbook with guidelines and suggested practices for financial record keeping and club operation. It is required that the club or association use the school's address as its business address to maintain the continuity of club or association records. All school-sponsored organizations will follow state and federal guidelines with regards to fundraisers and tax requirements. Johnston County Public Schools 2017-2018 PTA, PTO and Booster Club Handbook Page 16 of 22

After proper organization, should a Booster Club fail to adhere to the established guidelines, rules and regulations of the organization of fail to act in a manner consistent with the educational purposes for which it was established, the principal with the approval of the superintendent may suspend the association of the organization with the school. The Board of Education accepts no responsibility or any liability for actions or financial/contractual obligations or any other cause of actions of the organization. All items purchased by parent organizations or booster clubs for a school or school use become the property of the Johnston County Board of Education if accepted by the Johnston County Board of Education. Adopted: June 14, 2005 Amended: May 12, 2015, October 13, 2015, June 13, 2017 Johnston County Public Schools Johnston County Public Schools 2017-2018 PTA, PTO and Booster Club Handbook Page 17 of 22

Policy Code: 7230 Sales and Solicitations A. STORE SALES School stores may sell supplies and related items; however, they shall not sell food products. B. SALES OR SOLICITATIONS SPONSORED BY PARENTS, ORGANIZATIONS, BOOSTER CLUBS, ETC. Sales or solicitations sponsored by parents, organizations, booster clubs, etc., which are held outside the school and do not involve students in direct sales do not require board of education approval. Revenues received by the school from such projects are considered gifts and, the school nor the board of education accepts responsibility for any liability connected with the project. In such cases, the entire project must be handled by the sponsoring organization. Projects jointly sponsored by an organization and the school must meet all requirements of the board of education for school sponsored projects. C. STUDENT AND FACULTY INVOLVEMENT IN SALES (9-12) Every fundraising project involving sales by students in grades 9 through 12 to persons outside the school must be approved by the superintendent or designee. No instructional time may be used for the purpose of sales to the public and no student may be excused from school for the purpose of participating in a sale or solicitation. The superintendent or designee will consider approval when the request is made on the official forms provided by the school system and when required supporting data is included. The data must include: 1. The product to be sold and a copy of the proposed contract with the vendor. No contract is binding on the school unit until it is approved by the superintendent or designee. 2. The inclusive dates of the sales. All activities must be concluded within thirty days after the final day of sales. 3. The sponsoring club or group within the school that plans to conduct the sale. 4. The specific purposes for which the funds are to be used, the estimated amount required for those purposes, and the amount estimated to be raised through the sale. 5. The number of students to be involved in the sales. 6. The teachers or administrators who will be responsible for the sales project. D. STUDENT AND FACULTY INVOLVEMENT IN SALES (GRADES K-8) The effective school sales program shall safeguard the total development and the well-being of students. Schools and school-related organizations such as the PTA may conduct fundraising activities if students are not involved in direct sales and solicitation of contributions, pledges, or orders. The above restrictions do not prevent parents from ordering school pictures. Johnston County Public Schools 2017-2018 PTA, PTO and Booster Club Handbook Page 18 of 22

E. ATHLETIC ADMISSIONS, YEARBOOKS, NEWSPAPERS The sale of admission tickets to athletic events, concerts by school bands, school vocal groups, or other student performances does not require specific approval by the superintendent. The sale of advertising space in school yearbooks and school newspapers does not require the approval of the superintendent. F. FUND PURPOSES Fund-raising activities of students and teachers in the school shall be limited to purposes that have recognized educational value, and such activities shall not be used as the primary means of providing equipment, materials and services that are ordinarily financed by capital outlay and/or maintenance and operation funds. Fundraising efforts which are for the personal gain of an individual are prohibited. G. ACCOUNTING FOR FUNDS RECEIVED THROUGH SALES AND SOLICITATIONS The Johnston County Board of Education shall require a final report from the faculty or administrative sponsor and approval by the principal at the conclusion of each sale or project. Such report shall include an accounting of all receipts and disbursements, and the disposition of items not sold. Forms for this final report will be provided by the superintendent. All disbursements shall be by check, in accordance with applicable laws and regulations, and subject to review by the Johnston County Board of Education. The superintendent may develop procedures for the accounting of funds received by school-related organizations. H. USE OF APPROVED CROWDFUNDING FUNDRAISERS The use of any crowdfunding sites must be approved in advance of posting the fundraiser. The approved regulations as detailed in Policy 7230R must be utilized. Legal References: None Adopted: February 9, 1982 Amended: December 14, 1983; August 14, 1990; April 13, 2004; February 9, 2010; May 12, 2015; February 9, 2016, May 9, 2017 Johnston County Public Schools Johnston County Public Schools 2017-2018 PTA, PTO and Booster Club Handbook Page 19 of 22

Policy Code: 7240 School-Related Organizations - Funds Management School-related organizations or organizations which engage in public fund-raising activities in the name of the school or for the purpose of supporting school programs and extracurricular activities must be properly accountable to the public which contributes to such efforts and the school. These groups shall adopt a constitution or set of rules/by-laws which are approved by the membership prior to acting for or on behalf of the school. As part of the rules/by-laws providing for duly-elected officers, one officer shall be designated as organization treasurer charged with maintaining accurate and current financial records. These records shall be shared regularly at meetings of the membership or executive committee in a written financial report. The principal shall be apprised of the financial reports and share these reports with the school system's internal auditor. School-related organizations are responsible for maintaining their own financial records and depository separate from the school's accounts. All disbursements from organizational funds should be approved by the executive committee and shall require two signatures (generally the president/chief officer and treasurer) on all disbursements. All accounts are required to be reviewed annually by an outside entity. A report of the review shall be filed with the principal and the school system's internal auditor by October 1 for the preceding fiscal year ended June 30. Employees of the school are not permitted to routinely manage the affairs of school-related organizations during the workday. Financial records shall be subject to review by the principal or superintendent's staff, upon request. Failure to provide a timely review report or failure to provide financial records upon request may result in suspension or disbanding of the organization. All funds shall be deposited in a separate organization banking account. The organization treasurer shall be bonded for a limit equivalent to the organization's annual budget. Legal References: G.S. 115C-47, -448 Adopted: April 13, 2004 Amended: February 9, 2010; May 12, 2015; October 13, 2015; June 13, 2017 Johnston County Public Schools Johnston County Public Schools 2017-2018 PTA, PTO and Booster Club Handbook Page 20 of 22

Annual Review Checklist Upon completion of the June 30 bank reconciliation, an annual review shall be scheduled with an outside entity (an entity outside the organization who is qualified to perform this compliance testing/agreed upon procedures engagement according to the scope approved by the Board). Effective for the annual review of the 2017-2018 school year, the following checklist must be signed by the reviewer and submitted to the school s principal and the Johnston County Schools Internal Audit Department by October 1 (per school board policy 7240) for the preceding fiscal year ended June 30. Reviewers shall confirm the following items based on written documentation (not verbal information). For PTAs, this annual review replaces the standard review for the NCPTA and the results shall be reported to them by their required deadline. The scope of the review is as follows: 1. Confirm that the organization s Articles of Incorporation and bylaws were provided to the reviewer or are listed on the NC Secretary of State's website (www.sosnc.gov) showing that the organization is a nonprofit corporation. Yes No N/A 2. Confirm that a copy of the Johnston County Schools PTA, PTO, and Booster Club Handbook was provided to the reviewer. 3. Confirm that a list of organization s officers (minimum of president, secretary, and treasurer) was provided to the reviewer. 4. Confirm that the organization is a member of the NCPTA organization (if organization is a PTA) 5. Confirm that the PTO or booster club provided written documentation showing approval of 501(c )(3) or other tax-exempt status from IRS (or reviewer can confirm this on the IRS website) 6. Confirm that organization provided written documentation from the IRS stating the federal tax identification number (EIN). Proof would include the original letter from the IRS assigned the EIN to the organization. Another acceptable document would be the prior years' Form 990 showing the EIN. 7. Confirmed that 1099's were filed for previous calendar year for qualifying payments as required by the IRS by providing copies of these forms to the reviewer. 8. Confirm that all required 990 filings are current with the IRS by providing copies of these forms or e-filing confirmations to the reviewer. 9. Confirm the use of dual signatures on checks or electronic payments for at least 20% of disbursements. Reviewer may confirm this by reviewing cancelled checks or check images on bank statements, as well as supporting paperwork for electronic payments. 10. Confirm that the disbursements tested were made by check or electronic payments only (no debit cards or cash). 11. Confirm that supporting paperwork (check/payment request with dual signatures, invoices, receipts, and/or packing slips) was provided on at least 20% of disbursements. 12. Confirm that supporting paperwork (deposit slips, deposit reconciliation reports, fundraiser reports, or concession sales reports) was provided for at least 20% of deposits. 13. Confirm that the organization has a receipting process for fundraisers and other collections, where amounts are reconciled to the bank deposits. 14. Confirm that funds are deposited in a separate organization banking account (not the school s bank account). This account shall reflect the official name of the club or organization and carry the tax ID number of the club or organization. 15. Confirm that at least two officers names are on the bank signature card (President and Treasurer). The organization's officers shall provide a copy of the bank signature card to the reviewer. 16. Confirm that financial records are shared regularly at meetings of the membership or executive committee in a written financial report. Monthly financial reports or meeting minutes containing this information shall be provided to the reviewer. 17. Confirm that the organization s treasurer is bonded for a limit equivalent to the organization s annual budget. A copy of the current position bonding insurance policy and approved annual budget shall be provided to the reviewer. (Signature of Qualified Outside Entity/Reviewer) () (Print Name of Reviewer) (Email address of Reviewer) (Telephone Number of Reviewer) *Additional comments may be attached if needed Johnston County Public Schools 2017-2018 PTA, PTO and Booster Club Handbook Page 21 of 22

Thank you to all our volunteers! We appreciate everything you do for our students and staff. Please feel free to contact me with any questions or concerns. Tracy Stubblefield Internal Auditor Johnston County Public Schools P.O. Box 1336 Smithfield, NC 27577 Phone: (919) 934-6032 Ext. 7052 Cell: (919) 796-7163 Fax: (919) 209-0778 tracystubblefield@johnston.k12.nc.us Johnston County Public Schools 2017-2018 PTA, PTO and Booster Club Handbook Page 22 of 22