Managing Non-appropriated Funds Collected through Extension Offices and Programs


NDSU Policy 502 regarding Bank and Investment Accounts applies to NDSU Extension’s practices in regard to checkbooks. Extension offices are not allowed to have bank and investment accounts.

Extension offices are accountable for all non-appropriated funds generated through Extension programs in their jurisdictions. This includes, but is not limited to, all funds collected/raised in the name of 4-H Youth Development programs or that bear the 4-H name and emblem, and includes funds handled by clubs, committees and councils.

Non-appropriated funds are any funds, outside of appropriated tax dollars, collected by Extension for education purposes (honoraria, fees and registrations) and any funds collected and dispersed by Extension-affiliated groups (4-H, Master Gardeners, crop and livestock groups, etc.). Extension offices are not allowed to own these funds through a bank or investment account. Education-related funds can be held by utilizing the county auditor. Depending on the wishes of the auditor, the account(s) may be integrated into county Extension budgets or may be a stand-alone account.

Extension-affiliated groups may handle funds relative to their mission and purpose (4-H council handles related 4-H funds; ag, crop or livestock improvement groups handle crop or livestock-related funds).

Accurate records must be kept, good accounting procedures must be followed and the funds must be handled in a business-like manner.

The following procedures apply:

  1. Extension offices may be involved in the collection and receipting of funds related to the three options above (appropriated, non-appropriated, and affiliated). Extension staff cannot serve as signatories on any accounts. Extension office personnel, such as office professionals, may do the bookkeeping but must not have sole responsibility for the handling of funds. For funds of Extension-affiliated groups, the office personnel must work under the supervision of the treasurer of the organization or group. The treasurer is responsible for the reconciliation of the books. All accounts require at least two signatures for withdrawals, and the two signatories cannot be immediate family members. All accounts must be reviewed and audited annually by approved representative(s) such as advisory board or council member(s). An audit also may be requested by NDSU Extension administrative staff. All funds must be deposited or invested in a FDIC (Federal Deposit Insurance Corporation) or NCUA (National Credit Union Administration) insured institution. This procedure includes savings accounts, checking accounts, money market accounts and certificates of deposit.

  2. All funds must be receipted each time they change hands (i.e. at time of collection from payee, from the financial institution upon deposit, between any individuals to whom funds are transferred). Payment of obligations should be by check. An original and itemized invoice or receipt is needed to support any check written. Checks may not be cashed or written for more than the sale. Post-dated or two party checks are not accepted. Use of change funds and undeposited receipts for miscellaneous petty cash purchases, loans, advances of check cashing for any individual (including employees and customers) is strictly prohibited.

  3. All Extension-affiliated entities must have their own Employer Identification Number (EIN) from the Internal Revenue Service for opening accounts. Personal Social Security numbers may not be used for these groups.  Most tax-exempt organizations are required to file an annual return with the Internal Revenue Service. Which form an organization must file generally depends on its financial activity. Organizations with gross receipts normally ≤ $50,000 file a 990-N.

  4. 4-H specific procedures include:
    • Accounts (such as 4-H clubs, councils, etc.) must be included in the database of approved clubs/organizations maintained by NDSU through the Center for 4-H Youth Development. Current procedure is that the State 4-H Office is responsible for certifying official 4-H entities with 4-H national headquarters at USDA who notifies IRS. Local Extension offices have been provided with the procedures.
    • Federal regulations governing the use of the 4-H name and emblem require annual financial reporting/accountability of all organized 4-H clubs/units/groups. Instructions are provided in the 4-H Club treasurer’s book.
    • Funds also may be invested in a managed fund made available according to the North Dakota 4-H Foundation’s polices to produce long-term stable support for a 4-H group, club, council or program.
    • Funds for project auctions (usually livestock but may be broader than that) must be managed by a fair association or other entity/committee authorized to handle public money.
    • Regardless of the source, all 4-H funds must be used for 4-H Youth Development educational programs. All 4-H funds are public funds and must be publicly accountable. 4-H money (money raised in the name of 4-H) must not be mingled with non-4-H money. Additional information about handling 4-H money is in the  Handling Money in the North Dakota 4-H Program fact sheet posted on the NDSU Extension Center for 4-H Youth Development website.
    • 4-H clubs/councils/units/groups must include a statement of dissolution in their written operating guidelines or bylaws similar to the following: Upon dissolution of the 4-H club, any assets must be turned over to a recognized 4-H club/unit/group, with the approval of the county 4-H Youth Development staff.
    • For national 4-H organizational policy and regulation documents, see

June 2014

Top of page