Budget for Student Organizations

Welcome to Budget 101!

This page aims to help you navigate finance management for your student organization through roles, budgeting, documenting and reporting, and financial literacy.

  • Content Preview
    • Template Available (download and edit it in Google Form)
    • Glossary
    • Who should do budgeting?
    • How to budget?

Glossary

Let's look into the terms you'll be using when it comes to finanicial situations.

Term Definition
Budget A plan that estimates your income and proposes your expenses for a future period.
Income (Revenue) All the money you receive or earn (e.g., salary, grants, fundraising).
Expense (Expenditure) All the money you spend or plan to spend (e.g., rent, supplies, event costs).
Deficit When your expenses are greater than your income.
Surplus When your income is greater than your expenses.
Balanced Budget When your income equals or exceeds your expenses.
Actuals The real amounts of income received and expenses paid, as opposed to the budgeted estimates.
Variance The difference between the budgeted amount and the actual amount for any item.

Who should do budgeting for the org?

  • While a Treasurer often manages finances, more than one person must understand the organization's financial operations
  • You should:Establish written financial policies and procedures for your org during board meetings.
    • Establish written financial policies and procedures for your org during board meetings.
    • Separation of duties: two officers should handle all key financial duties
    • Create a conflict-of-interest policy that designated officers will sign each year
    • Establish an officer transition plan
    • Update authorized check signers (at least two on each account) with any changes in officers

How to budget?

1. Develop and Approve the Budget

  • Involve all executive board members to review funding sources and projected expenses.
  • Reference previous years' budgets (found under "Files" on SOCO) for guidance.
  • Upload your current budget under the "Accounting Book" tab on your SOCO page.

2. Structure the Budget

  • Income: Understand the sources of your income - HUA funding, department funding, grants, alumni support, fundraising, corporate support, donations...
  • Expenses: Project costs for all operations, including events, travel, supplies, promotion, and fees (HUPD, AV/media, custodial, licensing).
  • Ensure the budget is realistic and conservative. [Conservative Rule: Subtract 10% from projected income as a buffer]
  • Use the template or build your own balance sheet.

3. Maintain Financial Discipline & Transparency

  • Maintain financial records in accounting software or Excel spreadsheets and grant access to treaurers or other officers.
  • Strive to stay within the set budget.
  • Be prepared for budgets to change/shift; reallocate or secure additional funding for unanticipated costs.
  • Track all expenditures and income to ensure financial transparency.
  • Document reason or rationale for any budget variances on the sheets clearly
  • Prepare an annual report intended for all members and the general public that includes the organization’s mission, activities, and annual financial report

4. Harvard Federal Credit Union (HFCU)

  • If you need to change your organization account signers or open a new bank account, please fill out the HFCU Approval Form
  • If you're a new org without a bank account, you're required to create a new Harvard Federal Credit Union account to maintain accurate and consistent records.
  • Please check your organizational email regularly to stay updated on emails from HFCU.

5. Income - Cash and Check Receipts

  • Ensure checks or payments are made out to the student organization’s official name and address (payments should NOT be made out to individuals or received at personal addresses)
  • HUECU provides options for receiving payments or donations (ACH Transfers, PO Box to mail checks, mobile deposit)
  • Restrictively endorse checks "for deposit only, organization name" upon receipt
  • Secure checks and cash in a locked area before the deposit
  • Make timely and frequent deposits (ensure payments received are deposited at time receipt or at least within 30 days of receipt)
  • Record and reconcile all cash and check receipts in financial records or accounting software on a timely (monthly) basis

6. Paying Bills

  • Establish a process to review and pay bills tied to your organization’s bank account and don't pay with cash
  • Utilize payment methodologies available at Harvard Federal Credit Union (e.g., checks, debit cards, online bill pay, Zelle, and wires)
  • Separate officer should review vendor invoices and receipts for accuracy and validity before payment is made
  • A separate officer should review debit card activity for appropriateness
  • Payments should be substantiated with a business purpose
  • Maintain copies of vendor invoices and receipts
  • Ensure that two officers review and sign checks
  • Record all checks and payments in financial records or accounting software on a timely (monthly) basis
  • Reconcile all checks, invoices, receipts and other payments to bank statement each month

7. Contracts

  • Have two officers review and sign all contracts
  • Review draft contract terms early in the process
  • Refer to Student Organization Resource guide for contract best practices
  • Student organizations cannot sign contracts on behalf of Harvard University/College
  • The student organization's official name should be party to the contract, not Harvard University or any subsidiaries or individual students
  • While the Student Engagement team cannot provide legal advice, contracts can be sent for review to soch@fas.harvard.edu

8. Reimbursements

  • Payments to vendors and other purchases should ordinarily be made from the organization’s bank account
  • However, small incidentals may sometimes be incurred by members of the organization. Therefore, you need to establish a process to reimburse members for out-of-pocket expenses
  • Require submission of original receipts and documentation substantiating the expense
  • Have two officers review and approve before processing
  • Record reimbursement in financial records or accounting software on a timely (monthly) basis
  • Reconcile to bank statement each month

9. Bank Reconciliation

  • Reconcile bank balance to accounting records balance each month
  • Document all reconciling items
  • Address any discrepancies in a timely manner and contact your bank and/or vendor immediately if you notice any suspicious or unauthorized transactions
  • Obtain officer and board approval for the reconciliation