Bank debit cards may be used for purchases when the pre-approval expense authorization process is followed. Only elected officers designated as check-signers in the unit, council, or district bylaws may have or use debit cards issued by the banking institution. Only debit cards issued by the banking institution may be used (no store-issued debit cards, etc.).
Debit cards may be used for pre-approved expenditures only, and cannot be used for cash withdrawals of any kind (including pre-approved advances or cash back from approved expenditures) to ensure the two-signature rule is still observed and adhered to. Cash withdrawals over the counter or via debit card use raise red flags for financial reviewers and are a sign of potential financial mismanagement.
Credit cards should not be issued to a PTA or PTA officer due to the significantly increased risk of financial mismanagement.
Use of a PTA debit card must be tightly controlled by the PTA:
- Cards are issued to elected and authorized signers on the bank account only and must include the name of the PTA (appointed members of the board may not be added to the bank account and may not be issued or use debit cards).
- Direct cash transactions (ATM, cash back, etc.) are prohibited.
- The intended expense must be authorized prior to the use of the debit card, and the actual intention to use the debit card for the expense must be included in the motion for the expenditure (E.g.: “Susie Smith moves to approve the purchase of three Convention registrations at $249 each, for a total of $747, to be purchased using the Sunshine PTA debit card.”). The motion must be recorded in the minutes.
- An “Authorization for Payment via Electronic Services” form signed by two authorized check signers (as per the bylaws) must be submitted to the treasurer with documentation (receipts) for the debit transaction.
- All debit card transactions must be accounted for and reported in the monthly treasurer’s reports.
- The monthly bank statement review must be completed to ensure that no unauthorized transactions are processed against the PTA’s bank account with the debit card. The monthly bank statement review is required by the California State PTA insurance provider.
- Only elected officers designated as signers (as indicated in the unit bylaws) may be issued or use debit cards.
- A change in authorized signers on the checking account (e.g.: transition of officers for a new term, or the resignation and replacement of a financial officer) requires a change in authorized signers for debit cards with the banking institution and a financial review. This also applies when fraud or misuse of the card has been discovered.
- At the end of the term, debit cards must be returned to the treasurer, access to the account removed, and the cards must be destroyed.
- If the card is lost or stolen, the debit card must be cancelled and a financial review of the account must be completed to identify any unauthorized transactions.
- When using a debit card for expense transactions, make sure that the bank account has sufficient funds to cover the expense. Overdraft protection is suggested for bank accounts.
The above regulations must be added to the unit, council, or district’s standing rules if a PTA chooses to use a debit card.
Cyber Liability Insurance Coverage is recommended to protect against possible losses due to the use of a debit card, Electronic Funds Transfer, Automated Clearing House, or Bank Bill Pay Services.
If the unit, council and district membership does not allow the use of a debit card, but the banking institution requires a card to be issued to make deposits, the treasurer must verify with the banking institution that any cards issued are designated as “deposit only”.
Some banks automatically send bank cards to the homes of all check signers. If the units, councils or district’s membership does not allow the use of a debit card, and debit cards are sent in error, the treasurer must collect the bank cards, return the cards to the bank, ask that the cards be removed from the PTA account, flagged, and destroyed. Verify that all cards have been accounted for.
