Financial Policies and Operating Guidelines

LMSC Financial Requirements

Good accounting practices and knowledge of USMS Financial Policies and Operating Guidelines for LMSCs are vital to an LMSC’s financial health. The principal financial responsibilities of the LMSCs are to provide consistent financial reporting and remain in compliance with IRS requirements.

• Submit annual financials. Each LMSC shall submit their annual financial statements to the USMS National Office by April 30 using the USMS consolidated reporting template. 

• File 990-N. LMSCs must file an annual tax return, per IRS guidelines.

• Fiscal Year. Each LMSC shall use the same fiscal year-end as USMS, which is a calendar year.

• LMSC Officers. The LMSC Treasurer and Membership Coordinator shall be separate individuals.

• Expenditures. LMSC expenditures of $5,000 or more shall require LMSC Board of Directors’ approval unless the expenditure is authorized in their annual operating budget. All checks $5,000 and over must have two check signers. This is a Bonding requirement.*

• Review of Accounting. Someone in the LMSC other than the Treasurer and the person reconciling the bank statements shall perform periodic reviews of accounting records. This is a Bonding requirement.*

• Separating LMSC and Club Funds. LMSC bank accounts shall be separate and distinct from any other account. LMSCs may not commingle funds with club funds for any reason or accept payment for matters not pertaining to the LMSC, member registration, or LMSC sanctioned or approved events.

*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.

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