If you are just taking over the role of volunteer treasurer and you are feeling out of your depth, this series of posts on managing bank accounts will help you find your feet.

Let’s start by looking at what bank accounts you already have and which of them you really need.

How Many Bank Accounts are Enough?

Identify all the bank accounts that the organisation has.  It is not unusual to find you have bank accounts that you were not aware of.  These may have been set up by previous committee of management members, treasurers or staff over the years and used for various reasons.  While many may actually be dormant it is worth identifying, closing them and transferring any balance to the main account. The best way to do this is:

  • Review your records and list details of any bank accounts.
  • Contact the local branch of your bank and request that they do a check of their records for any accounts that may relate to your organisation.
  • It is also worth checking with the other banks as old accounts may have been set up with them in the past.

Decide how many bank accounts you really need. If you use a good accounting record keeping system such as Admin Bandit and you undertake accurate and regular reconciliations each month then you will probably only need the one operating account.
The important issue is to be able to track the different types of income and expenditure that may be linked to certain elements of your organisation.  Some issues to consider include:

  • If you receive funds from grants that must be used for specific purposes, how will you track the income and expenditure?
  • If you receive donations that may have been given for a special purpose such as purchase of equipment or building, how will you monitor how these funds?
  • If you are required to pay GST or PAYG, how will ensure that when payment is due that you will have enough funds?
  • Do you have an excess of funds that can be transferred into a fixed term deposit?

The last 4 points highlight some of the transactions that need to be managed but also explain why, in the past, separate bank accounts may have been set up.  They may have been used to manage the relevant funds for the different types of expenditure for the organisation.

Other than maybe a fixed term deposit account if you have some excess funds to invest, you should only require the one main bank account if you have good accounting systems to track and record the above transactions.