Important Tax & Fidelity Bond Information (click to download)
Finance Committee. The Department President shall appoint one three-year member to the revolving three-member committee. If a vacancy occurs for any reason, she shall immediately appoint a member to fill the un-expired term. Each member of the committee must be from a different Unit. The committee may use fax, phone or registered mail at Department expense if the committee is unable to meet together. All papers and reports must be returned to the Department Secretary at the Department convention.
The Finance Committee shall be charged with the preparation of the Department yearly budget and the supervision of the Department Treasurers’ expenditure of funds under that budget. They shall reconcile ALL Department accounts quarterly, verifying that all income, expenses and balances are in compliance with the budget. A copy of the quarterly report must be mailed to all members of the Department Executive Committee. The year-end report of the Finance Committee will be audited at the annual Department Convention by the Audit Committee. An oral and written report is to be given at the Department Convention.
There is increased demand from the public and the government for accountability from nonprofit organizations to demonstrate that a nonprofit is indeed serving the public good and fulfilling the charitable purpose for which they were granted federal tax exempt status.
“Transparency” merely refers to the level of openness in which a nonprofit operates and reports to the public. Transparency refers to the widespread availability of relevant, reliable information about the performance, financial position, and governance of an organization.
The American Legion Auxiliary, Department of Alaska’s annual report and any audited financial statements are available by simply contacting the Department Secretary at firstname.lastname@example.org.
The IRS Form 990, which include the findings of the annual external audits, is tantamount to an organization’s annual organization and financial report.
The American Legion Auxiliary’s IRS Letter of Determination grants a group tax exemption to the American Legion Auxiliary is available for download by just clicking here. Note: The ALA IRS Group Exempt Status Letter of Determination is dated 1973 and the 1973 Letter is the ALA’s current IRS Letter of Determination. Simply, the IRS made its most recent determination in 1973 and the determination stands until the IRS revokes or amends its exempt status determination about a charitable nonprofit.
Audit Committee: The Department President shall appoint a three member Audit Committee. Each member of the committee must be from a different Unit and must include a Past Department President. The Committee shall meet at the call of the Department President and must be available upon request to audit any Unit books.
Requests for audit must be made through the Department Executive Committee. The Audit Committee will receive quarterly reports from the Finance Committee and must audit their year-end report at the Department Convention.
A report of all audits performed during the year shall be made to the Department Executive Committee. The Audit Committee must give an annual report summarizing their findings and have two copies available for the Department President and Department Secretary at the Department Convention. No member shall serve more than one consecutive term. The committee may use fax, phone or registered mail at Department expense if the committee is unable to meet together. All papers and reports must be returned to the Department Secretary at the Department Convention.
- An audit is good business practice to ensure finances are being handled according to proper rules and procedures.
- An audit is a yearly checkup of an organization’s financial health.
- Audit is a tool to give leadership and members confidence that the financial house is in order.
- Audit is a detailed review of the financial records. Not a certification of finances.
- Leadership may choose to create an audit committee to conduct the annual audit
- A CPA (Certified Public Accountant) firm may be hired to perform the audit
Documents needed for an audit review include:
- Bank statements
- Reconciliations to bank statements
- Check register
- Any list of transactions that supports checks written
- Reimbursement requests and check requests, with back-up receipts/invoices
- Monthly financial reports published to members and organization leadership
- Approved minutes of meetings approving expenditures
- Any IRS filings
- A standard time period should be established for the audit each year