Financial Management

Strong financial management is vital to student group success. Student Unions & Activities provides templates for general ledgers, annual budgets and event budgets. These documents are helpful organizational tools and will be vital if your group goes through an audit process. We also outline successful officer transition documentation, as you prepare for incoming leadership or a change in leader responsibilities. For training in this area, set up an appointment with a Student Activities Advisor by emailing sao@umn.edu or calling (612) 626-6919.

In accordance with the University of Minnesota’s co-curricular educational philosophy, the University of Minnesota has an educational interest in promoting the sound financial operations of student groups. With regard to registered student groups classified as Registered Student Organizations (RSOs), this interest does not assume supervision over or responsibility for these groups. Student Unions & Activities provides financial training, consultation, and other services supporting the operation of student groups. Compliance with basic financial policies and procedures designed to promote responsible financial management is a requirement for student group registration with the University.

An online version of our Financial Management Training is available here.

Financial Policies for Campus Life Programs (CLPs)

  1. Registered student groups classified as Campus Life Programs (CLPs) must comply with all University financial policies and procedures.
  2. All CLP funds shall be reflected on the University ledger system and all major equipment shall be registered on University inventory.
  3. CLPs shall not maintain financial accounts (including checkbooks) outside of the University and/or University of Minnesota Foundation.
  4. CLP funds and financial operations shall be subject to the oversight of the host academic or administrative department.

Recommended Procedures

  1. Student group funds should remain separate from other departmental funds.
  2. All documents relating to the CLP should be signed by a registered officer of the student group and the departmental financial officer.

Financial Policies for Registered Student Organizations (RSOs)

  1. Registered student groups classified as Registered Student Organizations (RSOs) must comply with all University student group financial policies and procedures.
  2. RSOs shall maintain independent financial accounts (including checkbooks) outside of the University. RSOs shall not operate their finances via the University’s financial system.
  3. RSOs do not have access to the University’s tax-exempt status and may not use the University tax identification number. Student groups seeking tax-exempt status must file on their own behalf with the state of Minnesota and/or the Internal Revenue Service.
  4. Although the University of Minnesota requires all RSOs to operate as nonprofit entities, these groups do not have nonprofit status with the state of Minnesota unless applied for independently.

RSOs are encouraged to apply for an Employer Identification Number (EIN) to be used for any financial accounts on the group’s behalf. Groups apply for an EIN through the Internal Revenue Service (IRS).

Additional information on applying for an EIN can be found below.

What is an Employer Identification Number (EIN)?

An Employer Identification Number (also known as Tax ID Number) is an identification number used by the Internal Revenue Service (IRS) in the administration of tax laws. Groups are required to set up an EIN through the IRS in order to open a bank account. This number is also required in order for your group to fill out a W-9 if you are being set up as a vendor with the university or another company.

Applying for an EIN

  1. Go to the Online EIN Application
  2. Read instructions and click on “Apply Online Now”
  3. Read instructions and click on “Begin Application”
  4. Scroll to bottom of list and select on “View Additional Types including Nonprofit/Tax-Exempt Organizations,” click “Continue”
  5. Choose either “Community or Volunteer Group” or “Social or Savings Club” depending on which best describes your group. Click “Continue”
  6. Read description to confirm your selection. Click “Continue”
  7. Fill out remainder of required information
  8. Print out and retain a copy of your CP575 Confirmation. Your current and future officers will need this document for tax filing purposes.

Basic Financial Policies

Compliance

The financial operations of student groups must be conducted in accordance with all applicable local, state, federal laws and regulations, and the student group’s respective constitutions.

Responsibility

Registered officers of the student group shall have personal responsibility and accountability for the finances and operations of the group, in accordance with the Policy on Registration and Classification of Student Groups, and as specified in the student group’s constitution.

Banking

Registered Student Organizations shall independently secure and maintain banking services through a service provider of their choice. All accounts should be opened and maintained under a Tax ID Number (or EIN-Employee ID Number) specific to the group. Campus Life Programs may not have a checkbook or separate banking account, as they are required to use the University’s financial management system for all transactions.

Taxes

Student groups shall be responsible for all applicable taxes; including, but not limited to, collection and payment of sales taxes and filing and payment of income taxes.

Dissolution

Upon dissolution of a student group, the group’s officers shall be responsible for the distribution of remaining funds, in accordance with the group’s constitution.

Use of Funds

All use of student group funds shall be in accordance with the group’s constitution. Student groups may pay its officers and employees' salaries, wages, stipends, or other lawful incentives for services rendered. Student groups may also make financial awards/prizes to individuals, including officers or members, as a result of individual participation in a student group activity. Other payments, including gifts, distribution of residual assets or profits, dividends, and so on, to officers, members, or other individuals are prohibited. Where appropriate, organizations that qualify as charitable, educational, social, or benevolent organizations may make payments to other affiliated organizations outside the University. Check with SUA staff if you have questions about use of funds.

Budgeting

Student groups should develop an annual budget and have it approved by members before any expenditure is made. The annual budget should include all projected expenses and income. Student groups should track their ongoing expenses and income in comparison to their projected numbers. The budget should also break down expenses for operational costs as well as event costs. As a best practice, we encourage groups to include financial information for three years, including the previous year, the current year, and the projected budget for the next year. Groups are encouraged to use software such as Quicken, Excel, or Quickbooks to help track their expenses.

Budget Worksheet Overview

Student Unions & Activities recommends using the sample budget worksheet when managing student group finances. This tool captures a three year timeframe:

  • Actual income/expenses from previous year
  • Current/budgeted income and expenses for current year
  • Anticipated/requested income and expenses for upcoming year

Student Activities Advisors are happy to meet with group leadership to go over sample annual budget worksheets and event budget worksheets. Please contact Student Activities to schedule an appointment.

Partisan Political Activity and Finances

Partisan political student groups and student fees funding

Partisan political student groups are not eligible to apply and/or receive student services fees. “Partisan political student groups” are organizations affiliated with and in support of a registered political party or candidates for election. Such groups may seek funding for their nonpartisan political activities (e.g., candidate forums available to all qualified candidates, nonpartisan educational programs, etc.) through other funding opportunities.

Limits on use of University funds for all student groups

No registered student group may use University funds on behalf of a candidate for public office in a political campaign.

Instructions to Completing Form W-9 (Registered Student Organizations)

Your organization may be asked to fill out a W-9 if you are ever to be paid by another organization or company.

  • Name: Enter the organization’s legal name on the “Name” line and any “doing business as” (DBA) name on the “Business name/disregarded entity name” line.
  • Federal Tax classification Check the appropriate box that applies to your group:
    • Unincorporated Association (most groups): Check the Other box and specify unincorporated association.
    • Corporate Nonprofits
      • If your organization has not received federal tax-exempt status, check the Other box and specify nonprofit corporation.
      • If your organization has received federal tax-exempt status, check the Other box and specify Tax-Exempt Organization. Also check the box for Exempt Payee.
    • In Part I, enter your EIN that you received through filing Form SS-4.
  • Sign and date.