Finances

Sound financial operations and a healthy fiscal position are necessary for the long-term success of every chapter.  Chapters that succeed at this do the following:

• Set a budget that aligns revenues with spending priorities.
• Clearly communicate and effectively collect dues from members each semester.
• Hold brothers accountable to their financial responsibility to the Fraternity.
• Understand and meet all financial obligations to the national Fraternity.
• Have a clear process for tracking income and expenses with proper safeguards.
• Work with alumni-volunteers to complete an external audit and file the appropriate tax forms.
• Save five percent of the budget each year in a separate savings account.

Budgeting
A budget outlines expected revenues and expenses for a given semester, quarter, or year.  Every chapter should set a budget for each term that accounts for all of the needs of the chapter.  The budget can then be shared with the chapter to help brothers understand how their money supports their experience.  Chapters rarely struggle to collect dues when the benefits of the SigEp experience meet or outweigh the cost to a member of participating.

Setting a budget requires a clear understanding of all of the needs of an organization.  The best chapters set detailed budgets and hold chapter leaders accountable to meeting each line item.

The priorities of the chapter are most accurately reflected in the amount of money allocated to support each area of chapter operations.  Reviewing the chapter’s allocation of resources compared to chapter goals is a helpful activity to ensure money is being spent in the best interests of the chapter.  Part of effective resource allocation is ensuring that money is set aside each semester for chapter savings.  These funds can be used for major purchases and to ensure the chapter has a rainy day fund.

Chapter dues and the financial responsibility of brothers
With the many privileges of membership in Sigma Phi Epsilon come many responsibilities.  One of the primary obligations of an undergraduate member is to pay his share of dues to support the chapter experience.  The duty for communicating this obligation and collecting dues falls on the vice president of finance, with support from his committee and the rest of the executive board.

Set clear financial obligations and a timeline for payment each and every semester.  Expectations around chapter dues should also be incorporated into the chapter’s membership agreement.  All members should also understand how their dues will be spent, and know that no money collected by the chapter will be spent on the purchase of alcohol, per Sigma Phi Epsilon’s risk management policy.

As the majority of the chapter’s revenue is spent in the same semester, dues should be due as early as possible to ensure members are paying for the benefits they receive.  Many chapters match the policies of their college or university and match dues to a tuition deadline.

The Fraternity’s Grand Chapter Bylaws outline the policy for members who fail to pay their dues on time.  When a bill is 30 days past due, the member is suspended from all activities and rights of membership.  After 60 days, the member is expelled with the opportunity to return when his outstanding balance is paid in full.  See Section B of the Administrative Policies and Procedures for more information.

Payment plans should be used only as a last resort, and should carry strict provisions for suspension or expulsion if the member fails to keep current on his plan. 
 

National Fraternity billing
Sigma Phi Epsilon chapters pay two annual bills to support the services, events, programs and insurance provided by the national Fraternity.

The current fee structure for the fall operating and spring insurance bill is in the column on the right.  This document includes the current discounts available to chapters.

Bookkeeping
Maintaining clear and accurate financial records is a key to the fiscal health of a chapter.  The vice president of finance should have a clear system of tracking income and expenses and a way by which to report this activity to the executive board, the AVC and the chapter as a whole.  There are outside services available to do bookkeeping and/or collections.  Records should be in a format to keep from year-to-year.

To ensure proper fiscal management, chapters are encouraged to utilize dual-signature checks signed by both the vice president of finance and the chapter president, and to issue receipts when members are reimbursed for expenses.  Additionally, chapters are discouraged from having a chapter debit or credit card because of the risk associated with such direct access to the chapter account.

Annual tax filing and audit
Every undergraduate chapter is established with the Internal Revenue Service as a not-for-profit unincorporated association of men.  While chapters are rarely liable for paying taxes, the IRS requires that chapters file a Form 990 each year to maintain good standing.  Failure to file a tax return could result in fines, penalties or loss of tax exemption. 

Additionally, the vice president of finance and chapter president should work with the chapter’s Alumni and Volunteer Corporation to complete an AVC or external audit of the chapter finances every year.  This safeguard ensures that all funds are properly managed, and allows the AVC to understand the financial priorities of the chapter.