Student Groups May Open Outside AccountsBy Jennifer Lane
In light of the recent mismanagement of student activities' accounts, the Office of Residence and Campus Activitieshas started allowing student groups to hold outside bank accounts.
Previously, only a few large student activities, like The Tech and the Lecture Series Committee, were permitted to hold outside accounts. But an estimate last year by the Association of Student Activities indicated that around two-thirds of student groups held outside accounts anyway. Groups with illegal accounts will now be able to bring their accounts into the open.
The new policy is "a good way for the Treasurer's Office to bring illegal outside accounts into compliance," said Associate Dean for RCA Andrew M. Eisenmann '75.
In general, the new outside accounts policy has "done a pretty good job of matching the desires of student groups for low MIT interference with MIT's need to oversee their money flow,"said Association of Student Activities President Douglas K. Wyatt G.
After all the mismanagement that has occurred, "Ican understand groups being wary about reporting their accounts" to RCA, Wyatt said.
But the policy provides a viable solution to that problem. Groups who currently are holding illegal outside accounts have until the beginning of the spring term to report their accounts to RCA.
New option may not be used by all
Individual groups may or may not find having an outside account beneficial. Groups opening outside accounts will have some added financial responsibilities, Eisenmann said.
Counterpoint, the first student group to successfully complete the procedures to open an outside account, was very satisfied with the process, said Counterpoint President Mark L. Huang '99.
Counterpoint's decision to open an outside account was based on the fact that the group must process large number of dollars and individual transactions each month, Huang said.
After learning their actual account balance with RCA, Counterpoint immediately opened an outside account, Huang said. Their applications were processed by the Treasurer's Office within a week.
For other groups, however, opening an outside account is not necessarily an ideal situation, Huang said. Groups without high overhead should not open outside accounts, he said.
"I don't think we will open an outside account," said The Thistle's Financial Coordinator Teresa W. Lau '95. Since The Thistle deals primarily with transactions from advertisers within MIT, keeping an RCA account "makes more sense," she said.
Groups who want to open an outside bank account can pick up an application at RCA's office on the fifth floor of the Student Center.
Groups can then take completed applications to the Boston-area bank of their choice, Eisenmann said.
A member of the group then needs to submit the signature card for the account to RCA, who will check the card to ensure that the students with signatory powers are actually associated with the group.
RCA will then pass the information to the Treasurer's Office, where a representative from the office will be added to the signature list.
Treasurer authorizes accounts
The Treasurer's Office is the only office with the power, as designated by the MIT Corporation, to open accounts and authorize the use of MIT's tax exemption number.
That responsibility represented the crux of the problem that kept student groups from having outside accounts in the past, Eisenmann said. The outside accounts that existed illegally used either MIT's name or MIT's tax identification number.
Student groups will be held responsible for reconciling their own bank accounts and submitting quarterly reports to RCA, Eisenmann said.
Because of MIT's responsibility to report personal incomes to the Internal Revenue Services, student groups also will be required to submit a Payment to Individual form to RCA when a payment is made to an individual for services rendered, like disk jockey, Wyatt said.