LMSC treasurers perform an important and complex function. Good accounting practices and knowledge of USMS's financial policies for LMSCs are vital to an LMSC’s financial health. The USMS House of Delegates has included financial guidelines for the LMSCs in the USMS Financial Operating Guidelines (FOG).
Bonding insurance is carried by USMS, and coverage extends to the LMSCs. However, coverage requires that each LMSC produce an annual financial statement and that annually an internal review of the LMSC’s records is performed. Therefore, your LMSC must meet these requirements to ensure its coverage under the USMS bonding policy.
A summary of FOG financial requirements, IRS requirements, and financial recommendations are listed below.
LMSC Financial Requirements
- A copy of each LMSC’s annual financial statement must be submitted to the USMS National Office within 4 months after the end of the LMSC’s fiscal year.
- Each LMSC shall have a one-year fiscal period for tax and accounting purposes commencing on the first day of January.
- The same person shall not be both Treasurer and Membership Coordinator.
- All checks $5,000 and over must have two check signers. This is a Bonding requirement.
- The bank reconciliation must be completed by someone other than the Treasurer. This is a Bonding requirement.
- The LMSC shall not commingle funds with any other legal entity. (Separating LMSC and Club Funds)
Annual Financial Statement
Year End Reporting
- LMSC Financials Instructions
- Sample LMSC Financial Statements
- For those using Quickbooks accounting software, you can request a COA import file to facilitate entering this COA by emailing Volunteer Service.
IRS Tax Filing
Requirements and Filing Process
- IRS Tax Filing Requirements
- LMSC EIN Number
- IRS 990N User Guide (shows how to set up an account on irs.gov)
- Screen shots of the 990N filing process
- Ready to file? Use the Form 990-N Electronic Filing System (e-Postcard) page to start the process.
LMSC Financial Recommendations
- Each LMSC should maintain financial statements and records, including receipts, bank statements, invoices, and other supporting documentation for a minimum of 3 years and possibly for as long as 7 years after the tax filing deadline for the year.
- Common stocks, preferred stocks, option devices, obligations denominated in foreign currencies, and derivative products are not considered appropriate financial instruments for USMS or any of its LMSCs.
- Each LMSC’s financial records should be reviewed occasionally by someone other than the LMSC’s Treasurer. Such review to include:
- Verification of bank balances
- Sample review of revenue
- Review of expense documentation