Guidelines for TIAA Treasurer as of 9/18/2020

This policy will be revised when needed and reviewed in detail at least annually by the TIAA Treasurer for consistency between policy and current practice.

Overview

Texas Instruments Alumni Association (TIAA) is a social club, set up as a non-profit entity in the State of Texas. TIAA is NOT exempt from Federal income tax. It is the Treasurer’s responsibility to maintain the integrity of TIAA’s financial statements, protect TIAA’s assets and ensure that TIAA has sufficient funds to meet operational requirements.

References (all available on the TIAA website):

Accounting Services Firm

The accounting services firm used by TIAA is James L. Falgout, P.C., located in Richardson, Texas. Falgout deposits funds, prepares checks, files tax documents and produces monthly financial reports. Accounting is on a cash basis. TIAA operates a checking account at Texans Credit Union, which is used for operating purposes. Falgout reconciles this account monthly. TIAA also maintains an investment account with Merrill Lynch. The TIAA Treasurer has the authority to transfer funds between the checking account and investment account as needed to ensure cash needs for operating expenses are met.

The accounting system used by Falgout is QuickBooks. TIAA uses some of the accounts prescribed by the accounting system, but the title of the accounts and descriptions are tailored to TIAA’s purposes. The Chart of Accounts includes income (deposits) and expense (checks) accounts. The TIAA Chart of Accounts and Account Descriptions are contained in a separate document maintained by the TIAA Treasurer (hereafter referred to as “Treasurer”). Changes are made as appropriate and reviewed at least annually to ensure consistency with practice.

Texans Credit Union and Merrill Lynch.

Annual Budget

Each year the Treasurer works with the TIAA President (hereafter referred to as “President”) and other members of the Leadership Team to develop a comprehensive TIAA annual budget. The budget may be modified as the year goes on to reflect changing needs and objectives. The goal is to break even at the net income level and to maintain a prudent Fund Balance to help offset fluctuations in income and to support periodic one-time investments. Once the budget is approved by the Leadership Team, it is the responsibility of the respective committee Chairs to ensure that expenses incurred by their area of responsibility are within the budget, or have been approved as an exception by the Treasurer.

Monthly Financial Process

In general, the process of depositing receipts and disbursing payments starts with the TIAA Administrator (hereafter referred to as “Admin”) completing deposit forms and check request forms with supporting documentation. TIAA retains the original invoices and documentation and provides a copy to Falgout with the check requests. The Treasurer then reviews these to ensure adherence to budget, adequate approvals and documentation, and correct account postings. The Treasurer then signs the forms. This is generally done by Wednesday at noon each week, although adjustments are sometimes made for month-end or periods of low activity. A representative of Falgout picks up the forms each week for processing at their office.

Deposits which are a reduction of a previously recorded expense item are recorded as a credit to that same expense account, and likewise, check requests which represent a refund of a previously recorded income item will be debited to that same income account. The Admin retains a copy of all signed deposit forms and check request forms, along with supporting documents, in a locked file cabinet.

In Case of Absence

If the Treasurer is unavailable to carry out weekly duties outlined above, a TIAA board member may temporarily assume them. Dual approval (two separate people) of expense items must be maintained.

Monthly Reconciliation

Falgout publishes five monthly reports for TIAA:

General Ledger (GL),
Statement of Revenue and Expenses,
Check Register,
PayPal register and
Wage/Tax summary.

The target date for these reports is mid-month of the month following the month-end close. The Treasurer will perform a timely reconciliation between TIAA records and the Falgout reports each month. The Treasurer is also responsible for reconciliation of the total fund balance, which includes the Merrill Lynch investment account and the TIAA checking account.

Spreadsheets

The TIAA Treasurer maintains a series of spreadsheets that are more granular in detail vs. the accounting performed by Falgout. At the highest level is a TIAA P&L spreadsheet which is reconciled monthly with Falgout accounts, and also includes TIAA’s ending Fund Balance. Other spreadsheets which may be used include:

Detailed log of all check requests, which ties to TIAA total expenses
Detailed log of all funds received, which ties to TIAA total income
Annual Budget for the current year
TI Retire Luncheon income and expense summary
TIAA Charity Golf Tournament income and expense summary
TIAA Trips and Events income and expense summary
TIAA Education Seminar expense summary
TIAA Annual Business Meeting expense summary
PayPal accounting summary for TIAA
IT expense summary
Skvare invoice
Investment fund roll-forward.

TIAA Income

TI Funding

TIAA receives funding from both TI Human Resources and TI Public Affairs.

TI Human Resources provides Operational Funding for TIAA in the form of four quarterly payments of $10,000 each.
TI Public Affairs provides support for the annual TI Retire Luncheon, currently in the amount of $40,000.
Public Affairs also provide support for the annual TIAA Charity Golf Tournament, currently in the amount of $3,000.

In order to obtain these funds, the Treasurer requests TI Finance to submit a PO through SAP. The Treasurer follows up with Falgout to ensure that payment is received and credited to the appropriate TIAA income account

Below are the details for TIAA funding:

TIAA Funding
First Quarter Operations	$10,000	January 15th	PA (Terri Grosh)
Second Quarter Operations	$10,000	March 15th	PA (Terri Grosh)
Third Quarter Operations	$10,000	July 15th	PA (Terri Grosh)
Fourth Quarter Operations	$10,000	October 15th	PA (Terri Grosh)
Golf Tournament	$ 3,000	Third Monday of April	PA (Terri Grosh)
Golf Tournament	$ 2,000	Third Monday of June	Texans (Max Post will contact)
TI Retiree Luncheon	$40,000	Third Monday of July	PA (Terri Grosh)

TIAA Expenses paid directly by TI

In addition to the cash funding that TIAA receives from TI, TI Human Resources also absorbs TIAA mailing costs. This includes mailing of the monthly TI Alumni News, pre-funding fees for business reply mail (BRM), other TIAA mailings and TI Mail Room overhead costs associated with TIAA. The Treasurer makes an attempt to capture and record these and any other TI subsidies in order to have a comprehensive picture of TIAA total expenses.

Membership Dues

There is a published schedule of membership dues. New members are granted “first-year-free membership,”; however, TIAA does not give a credit when members sign-up and pay for an extended-term membership. For example, one-year membership is $10 and lifetime membership is $100, but an individual signing up for membership for the first time will not be given a lifetime membership for $90.

In the rare occasion when a potential member wants to join TIAA but does not have sufficient financial means, the Admin or a TIAA Officer, after reviewing the situation, may make a decision to waive the membership fee. In such case, the Membership Development Committee Chair is promptly notified.

PayPal

In addition to paying dues or for travel events by check or cash, members may pay on-line using PayPal. PayPal charges TIAA a fee for this service. Fees are on a sliding scale ranging from 5.9% for a $10 one-year membership to 3.2% for a $100 lifetime membership. The process for obtaining these funds from PayPal is as follows:

At least five business days prior to the end of each month, the TIAA CIO will make a withdrawal request from PayPal to zero out the TIAA PayPal account and transfer the proceeds to the TAC bank account. The CIO will also pull an Excel file transaction report from PayPal detailing activity since the prior month. The CIO will send the transaction report along with the notification of transfer to the Falgout accountant, the Treasurer and the President. Most of the transactions are related to membership dues and member payments for TIAA Travel and Event activities. The Treasurer will review the report and communicate with Falgout as necessary regarding how to book other transactions. For example, from time to time the TIAA CIO authorizes and pays certain Web-related expenses through the PayPal account.

A year-end transfer and report is required to ensure that all transactions for that year are included in the year-end financial statements. Since the payment will not be received until the following year, reconciling adjustments will be made to the books for the current and following year as needed.

Amazon.com “Advertising Fee”

TIAA is a member of the Amazon.com “Associates Compensation” program. As such, whenever anyone makes any type of purchase at Amazon.com by FIRST going to the TIAA website at tialumni.org/membership/vendor-offers or tialumni.org/tiaa-info/books-tiers, TIAA receives an “advertising fee” that ranges from roughly 2.4% to 8% depending on the item and circumstances. Amazon accrues these amounts until the balance reaches $10 at which time they make a transfer to the TIAA bank account and notify the TIAA CIO who in turn notifies the Falgout accountant and the Treasurer. A logon and password to the Amazon account is available for the Treasurer to monitor. These referral fees are booked to Advertising Income, account 414-32. TIAA enrolled in this program in 2007.

TIAA Expense

Approval and payment of expenses:

Pre-warning the Treasurer is required prior to an expense of more than $5000.00. Typically, the large expense will be for cases associated with the TIRL. The intent is not for approval (assuming the expense is in the budget) but to forewarn the Treasurer who in turn forewarns Falgout of the impending expense and Tom Boedeker for cash flow forecasting.

Upon receipt of an invoice or other authorization to pay a bona fide expense of TIAA, the Admin completes a check request form noting the appropriate expense account. There are three parties identified on the check request form: Requestor, Approver and Payee. The Approver, typically the Treasurer, is the independent party and cannot be the Requestor or the Payee for a specific transaction. All expenses incurred for TIAA-sponsored events or by the various committees require approval prior to final approval by the Treasurer. For example, invoices associated with the TI Retiree Luncheon, Newsletters, Seminars, Activities, etc. must be reviewed and approved by the activity/event coordinator prior to the review/audit and final approval of the Treasurer.

In the case of major events, such as the TI Retiree Luncheon, the Golf Tournament and the Annual Business Meeting, the event coordinator is required to obtain signed contracts, which are reviewed by the Treasurer and filed by the Admin. Invoices for these events are then checked against the contractual agreement before approval.

Nominal expenses, e.g.; office supplies and business meeting meals, can be final approved by the Treasurer. Anyone (including the TIAA Admin, President and Treasurer) who is to be reimbursed for an expense on behalf of TIAA must have an independent review and sign-off prior to the submittal of a check request. On occasion, for convenience, the Admin or others may use their personal credit card for small purchases, for which they will submit a check request and be reimbursed in a timely manner prior to having to pay their credit card bill. This accommodation precludes the need for the administrative issues associated with a petty cash fund.

See the TIAA Guidelines for Credit Card Use.

Bus Rental

TIAA requires bus rental service for many of its activities and uses a bus company recommended by TI when TI does not provide the bus. The Admin contacts the bus company for quotes prior to usage and the bus. TI currently absorbs these bus charges and has been doing so since 2015.

Printing

Most of TIAA’s printing expenses fall under the responsibility of the Communications Committee and the Membership Development Committee. In order to reduce printing and postage costs, TIAA has a continuing thrust to move communications from printed to electronic in cases where other administrative costs are not adversely impacted.

TIAA’s largest printing costs are for the monthly Newsletter. Since engagement costs are high, TIAA endeavors to select a printer with whom we can have a long-term relationship. The selection process is lead by the Communications Committee, in consultation with the Treasurer, and the candidate list should be printers with whom TI has a relationship. Once the selection has been made, on an on-going basis the Communications Committee obtains a quote from the designated printer each quarter prior to letting the job. In the case of other printing jobs, the printer selection is generally made by the Admin, from a list of printers with whom TI has a relationship. Most jobs are small and don’t require that multiple quotes be obtained, however a multiple quote process should be used periodically to ensure that TIAA is receiving the best cost.

TIAA Administrator (Admin)

The only paid position in TIAA is the Admin, and it is a very key position. Work hours are expected to be roughly half-time. The expectation is in the 20 to 25 hours per week range, on average.

Hiring Process

The hiring for this position is conducted by the President and Treasurer and others whom the President may wish to involve. There are published criteria for the position.

Time Sheet

The Admin is paid monthly. At the end of each month the Admin submits a time sheet in Excel spreadsheet form, as an attachment to an email which is addressed to the President, copying the President and Treasurer. The spreadsheet lists each day of the month and shows a start time and end time. Hours worked are shown in ¼ hour increments (15 minutes). The Executive Vice-President reviews the time sheet and sends an approval email to Falgout. On the occasion that the Executive Vice-President is unavailable, the President will approve the time sheet by the same method.

One of the duties of the Admin is to attend TIAA trips and events for coordination purposes. When attending these events, TIAA pays the Admin’s admission fee, if any, and hours incurred are included in the monthly time sheet.

Annual Review

In May/June each year the Admin is given an informal performance review. The job description used is that of a non-exempt Job Grade 66; however the pay level is less due to the non-profit and voluntary nature of TIAA. The review is conducted by the President and Treasurer with inputs solicited from other TIAA Officers and Executive Committee members who receive support from the Admin. If deemed appropriate, a pay increase, in-line with the percentage increases for TI non-exempts, is processed, with an effective date of June 1st.

Significant TIAA Events

TI Retiree Luncheon

The Retiree Luncheon is the largest and most significant event that TIAA holds each year. As such, it is important that the Treasurer be involved in key steps in the process including budgeting, site selection, contracting and expense review. One of the tools for budgeting and expense control is the income and expense Excel spreadsheet maintained by the Treasurer.

Charity Golf Tournament

In addition to TI funding, TIAA has historically received Charity Golf Tournament funding in the amount of $2,000 from Texans Credit Union (hereafter referred to as "Texans"). The appropriate TIAA representative contacts Texans each June to secure this funding. Underwriting from TI and Texans covers the operational expenses of the tournament so that all money donated can go directly to the charity. Expenses include TIAA out-of-pocket costs, such as golfing fees, luncheon fee, printing, goodie bag, etc, and TIAA’s general administrative costs for supporting the event. The money raised by the tournament flows directly to the charity (currently The Senior Source) and does not go through TIAA accounts. The Treasurer maintains an Excel spreadsheet showing detailed cost for this annual event.

Travel and Events

In addition to the Retiree Luncheon and the Charity Golf Tournament, the Travel & Events Subcommittee organizes many trips and events each year for the benefit of TIAA members. Prices for these trips are set by the subcommittee to reflect both venue charges (if applicable) and, if a bus is used, theoretical bus cost.

Education Seminars

Each year the Education Committee plans and coordinates a number of large seminars. These events are generally free to members and nonmembers and TIAA underwrites the cost. On occasion, TIAA teams with other organizations to put on a seminars and TIAA is also experimenting with allowing outside organizations to partially sponsor certain events. The Treasurer maintains an Excel spreadsheet showing detailed cost for each event.

Annual Business Meeting

TIAA’s Constitution requires that: “Members of this Association shall meet at least once during each calendar year for the purpose of electing officers and other items that may be placed on the agenda at the time the meeting is called.” A quorum of at least 25 members is required to conduct business at this meeting. The Treasurer maintains an Excel spreadsheet showing detailed cost for this annual event.

Other Responsibilities

Treasurer’s Report at Leadership Team Meetings

The TIAA Leadership Team typically meets six times per year. At each meeting the Treasurer reports on the finances of the organization including income and expense for key categories and progress toward achieving the annual budget. The Treasurer also provides a report on the TIAA fund balance.

The TIAA files currently include copies of check requests, deposit slips, notebooks for the major TIAA events, including the TI Retiree Luncheon the TIAA Golf Tournament, and other supporting information. Financial records for the periods prior to 2006 are no longer available. Going forward, summary and backup financial records are to be retained for the current year plus the three prior years, which is the standard practice, used by TI. A Financial Summary P&L spreadsheet for all years, starting with 2006, will be retained indefinitely.

Updated by Shyamal Parikh on September 18, 2020