1) Who's money is it?

Answer

Student activity fees are legally considered public monies of the state of North Dakota. North Dakota State University acts as an agency of the state. On the financial reports of NDSU, student activity fees are reported as NDSU revenue.

2) Who manages the money?

Answer

Student government is responsible for managing the student activity fees. Through an annual budget process, student government allocates the fees to student clubs/organizations and some NDSU departments. The President of NDSU must approve student government's annual budget.

3) How is the money managed?

Answer

Based on student government's annual budget, student activity fees are transferred to funds set aside for each student organization and some NDSU departments. These are funds on the books of the University.

In order for student clubs/organizations to draw-down their award/grant, they must submit a request to the student finance commissioner. On the books of the University, the draw-down is charged to the fund where the award was set aside for the club/organization. From an accounting perspective, these temporary draw-down funds are considered NDSU funds. The draw-down of these funds are considered a grant or award to an external party (i.e., student club/organization), and so the disbursement to the club/organization is reported on the University's financial reports as an expenditure in the University's current funds. These "University" awards/grants from student government to the student clubs/organizations are not supported by invoices like other University expenditures and so will not be subjected to the same audit standards as other University expenditures.

The student club/organization's draw-down request must document how the money will be used. Once approved, a request for payment form is processed through the NDSU Accounting Office and a check, usually made out to the student club/organization, is ready within the two days. The student club/organization should deposit this check into the club's own bank account.

The student club/organization is responsible for spending the money within the intent of the award/grant. The club/organization is also responsible for the accounting, internal controls, and financial reporting for the money once it is received by the club and off the University's books.

For student government awards/grants to other NDSU departments, such as athletics and the memorial union, the approved amount for the year is transferred to the applicable NDSU department. The accounting transaction is treated as a transfer between NDSU funds. The department receiving the award/grant is responsible for accounting, internal controls, reporting, and spending the money within the intent of the award/grant.

4) Where can student club/organizations deposit their student government award/grant?

Answer

Student club/organizations should open a bank account, as authorized by their bylaws, officers, or advisors. It is advisable to maintain good internal accounting controls over receipts and, especially, disbursements from the bank account. Segregating duties or having two people involved in the transactions is advisable. Requiring two signatures on checks can help. Rotating duties can also help.

5) What about Taxpayer Identification Numbers (TINs)?

Answer

Banks will require that the club/organization provide a TIN in order to open a new bank account. Since the club/organization is not legally a part of the NDSU, or the state of North Dakota, the University's TIN must not be used to open a bank account. The club/organization must obtain its own TIN from the federal government.

6) How does a student club/organization obtain a TIN?

Answer

The club/organization must fill out form SS-4 Application for Employer Identification Number (EIN) and submit it to the IRS. There are two types of TINs. For individuals, their social security number is their TIN. Club/organizations, just like a business or non-profit entity, would apply for an EIN.

7) Are clubs/organizations exempt from paying sales taxes on purchases?

Answer

No. The club/organization must not attempt to use the University's sales tax exemption permit to avoid paying sales taxes on purchases.