The basics of club finance

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Knowing some financial basics and essential safeguards protects your club's money.

Understanding Key Concepts:

'Not-for-Profit': This doesn't mean the club can't make a profit (a surplus)! It simply means any surplus must be reinvested back into the club to achieve its objectives (as per the constitution), not distributed to members. Running at a surplus is healthy for sustainability.
Committee Accountability: Financial management isn't just the Treasurer's job. The entire Management Committee is accountable for the club's financial performance and decisions. Payments generally need committee approval (or ratification).
Basic Terminology: Knowing terms like Assets (what the club owns), Liabilities (what the club owes), Income, and Expenditure helps everyone understand financial discussions.
- Resource: QLD Gov Financial Terminology (PDF)

Protecting Club Funds (Financial Safeguards):

Putting simple measures in place can prevent accidental loss, theft, or fraud:

Dual Authorisation: Require two authorised people to approve payments (e.g., two signatures on cheques, dual approval for online transfers).
Approve Expenditure: All spending should be approved (beforehand) or ratified (afterwards, for emergencies) by the committee, usually at meetings.
Minimise Cash Handling: Use electronic payments (EFT, card readers) wherever possible. If handling cash, ensure proper supervision and record-keeping.
Keep Good Records: Maintain accurate and up-to-date records of all income and expenses.
Verify Large Payments: Contact recipients directly (using known contact details) before making large or unusual payments to confirm bank details haven't been compromised.
Regular Reporting: Ensure the Treasurer provides clear financial reports at each committee meeting.
Ask Questions: All committee members should feel comfortable asking questions if something doesn't seem right or isn't clear. Look out for 'red flags' like unexpected financial changes or vague answers.
Speak Up: Encourage anyone to raise concerns early if they spot something unusual.

QLD Government Resources:

These basic practices form the foundation of responsible financial management for your club.