Student Unions & Activities : University of Minnesota

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Maintenance & Tracking

A student group has an obligation to responsibly use its resources toward its mission and purpose.

As a best practice, student groups should track all income and expenses on a regular basis using a general ledger (record of all transactions), rather than relying on the group’s bank statements. Officers with financial responsibilities should prepare and analyze financial reports on a monthly basis (at minimum), and share the general ledger with the group’s leadership regularly at least once per semester, minimum. Other options for sharing with the group’s leadership or general membership include sharing weekly, bi-weekly or monthly, depending on the needs of the group.

Financial Best Practices

  1. Financial Checkbooks should be balanced each month (minimum).
  2. All general ledger transactions should be documented with items like invoices, bills, or other legal evidence.
  3. Keep track of each check (written, voided and blank). Carbon checks are recommended. Keep all returned and voided checks. It is also recommended to have two signers required on each check and to utilize the check’s memo line to help your group know why a check was written
  4. Create and use a reimbursement form each time a reimbursement check is issued. Expenditures must have approval from the proper source (executive board, general membership, advisor, etc.) prior to the actual purchase. No receipts=no reimbursement.
  5. NEVER issue a blank check.
  6. Blank checks should be stored under lock and key.
  7. The treasurer should keep a record of all monies. Make sure to back up any electronic files in case of emergency.
  8. Update authorized signers immediately with any changes in officers. When there is a completely new group of officers, an outgoing officer should be present at the bank to verify the new signers.
  9. Pay invoices on time to avoid late fees as well as possible future problems with doing business with a particular vendor.
  10. Deposit all checks and cash received within 48 hours of receipt. Incoming checks should be immediately stamped “For Deposit Only.”
  11. Create a conflict of interest policy that incoming officers will sign each year. This policy will ensure that group funds will not be used for personal gain, as well as helping your group think through different factors in the decision making process.
  12. Conduct regular independent audits. This will help ensure that your group is regularly and accurately recording transactions and properly maintaining files.

Student Activities Advisors are happy to meet with group leadership to go over sample general ledgers. Please or call 612-626-6919 to schedule an appointment.

Student groups should ensure the separation of financial duties to serve as a checks and balances system to prevent theft, fraud or inaccurate reporting. This separation of financial duties should separate the function of paying bills from reconciling the group’s financial records. Student groups should set an approval process for all purchases to eliminate inappropriate spending/purchases. These financial controls should include individual purchase thresholds. All expenditures not usual to the pursuit of the group’s normal operations should have prior approval from the group. These expenditures include, but are not limited to; loans, transfers or funds to other organizations, grants, special banquets, and social programs. Any check payable to the signer of the check should bear the signature of another registered officer.

Groups should clearly define the roles and responsibilities of each position and should include financial duties in those descriptions. Officers’ roles and responsibilities should be incorporated into governing documents (i.e. the student group’s constitution). In addition, groups should establish a Conflict of Interest Policy that is signed by officers on an annual basis.

Conflict of Interest Policy

A conflict of interest typically occurs when a person in a position of authority over an organization may benefit personally from a decision he or she could make. A conflict of interest policy consists of a set of procedures and guidelines to follow to avoid the possibility that those in positions of authority over an organization may receive an inappropriate benefit. A conflict of interest policy also protects a group from potential activities that would benefit the private interest of an officer or member and would compete against the best interest of the group. These policies typically require officers or employees to disclose any interests that could be considered a conflict. Please view the sample conflict of interest policy when developing your group’s internal procedures.


Nonprofits must comply with all federal, state and local laws concerning fundraising practices, including registration and annual reporting with the Office of the Minnesota Attorney General. If raising funds for a third party, student groups should keep all copies of bank deposit amounts and checks written to the third party. As a best practice, student groups should also create a policy that explains what gifts, if any, officers and group members can personally accept. This should be created in conjunction with the conflict of Interest policy to eliminate any potential conflicts for the group.

Financial Disclosure Plan

Student groups should produce a financial disclosure plan, or a summary of expenses, income and general activities. Registered Student Organizations whose gross receipts (income) are more than $5,000 annually, may need to report their financial disclosure through the filing of IRS Tax Form 990-N, 990-EZ, or 990 in order to stay compliant with the IRS. Please see Tax Obligations—Payroll and Income for additional information. Whether your group submits one of these forms or not, a best practice for student groups is to also include a financial disclosure plan as part of your group’s yearly review.

The financial disclosure plan should include:

  1. A brief description of the organization’s mission/most significant activities
  2. Number of voting members and non-voting members
  3. Number of employees
  4. Number of volunteers
  5. Revenue from grants
  6. Revenue from programs/services that the group has offered
  7. Other revenue
  8. Grant money awarded to outside entities
  9. Salaries or other compensations
  10. Total fundraising expenses
  11. Operational costs
  12. Other expenses
  13. Tax Documents- Exemption Application (Form 1023 or 1024), IRS Determination Letter, and Annual Information Return (Form 990 or 990-EZ)


Please see Tax Information for additional information regarding tax requirements, obligations, policies and procedures.

Nonprofit organizations must comply with all federal, state and local employment laws when hiring and employing personnel, including withholding and payment of payroll taxes and use of restricted funds

Organizations that sell taxable items (such as publications, jewelry, etc.), must additionally collect sales and use tax and file these taxes with the Minnesota Department of Revenue. For more information about collection and remittance of sales and use tax, visit the Minnesota Department of Revenue Sales and Use Tax Division for more information

Each nonprofit organization must also make certain data available to the public, including:

  • IRS Form 990 or 990-EZ for the previous three years, including clear statements of program service accomplishments in Part III. For groups that complete the 990-N, the form is automatically made public via the IRS Select Check feature.
  • IRS Form 1023 or 1024, Application for Recognition of Exemption
    • Posting on the organization’s website
    • Posting on another website ( or similar website)
    • Providing copies upon request
    • Inspection at an office of the organization
    • Boards should consider adopting an IRS Form 990 review policy that provides adequate time for meaningful review by at least a subcommittee of the board and a method for allowing feedback and revisions based on board input.
    • Documentation of the review made in meeting minutes

Paying Students (including stipends)

For students that have paid employees, you are required to pay federal and state taxes. We encourage groups to consider using a payroll service to help manage payroll.

Payroll services can assist with W-2s. Please see the IRS website and recommendations for more information.

Payment for Services Performed by Individuals

Student groups may pay members for services performed, as long as the amount is reasonable and is authorized by the group’s constitution and by-laws. We recommend that authorization be in writing in meeting minutes and that the group draw up a contract. Groups paying independent contractors for services, who are not employees subject to withholding, have additional requirements.

Please see Tax Information for additional information regarding tax requirements, obligations, policies and procedures. All amounts paid as salaries, wages, stipends, remuneration, or whatever name is given, are taxable by the IRS and by Minnesota.


  • Verify that the amount and time period agree with the terms of appointments to avoid overpayment of employees.
  • Maintain documentation on each employee and terms of employment to avoid unauthorized payments to employees.
  • Verify rate of pay and hours worked before writing check.
  • Set up biweekly paydays for employees.
  • Make arrangements for payments during school break periods.
  • Make sure that taxes are paid to the IRS by the due date to avoid late fees and penalties.
  • Keep up with tax policies to ensure correct withholding.

Employees of student groups classified as Registered Student Organizations are not employees of the University and are not eligible for benefits of any type, including compensation, from the University.