DrupalCamp accounting practices

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Aaron Stanush's picture

I was just wondering how other DrupalCamp organizers handled the money-side of putting on an event. We've hosted DrupalCamp Austin two times now, and both times we've just had the money flow in and out of our company's PayPal and bank accounts. Ideally, you would want the camp to have its own accounts so that the money can cleanly exist separately from that of the hosting company/organization.

Getting money
Is it common practice for DrupalCamps to have a separate PayPal account at least? The drawback I see with this is that result in losing a couple of hundred dollars to fees if you're having your sponsors pay the PayPal account directly.

Paying expenses
If you do set up a separate PayPal account for your event, are you able to pay all of the related expenses from this account? I understand that it's possible to get a MasterCard associated with your account, from which you can make charges against your balance. In the case that a vendor does not accept credit cards, do you still pay them from your company account and then reimburse yourself from the PayPal account?

The bottom line
From an accounting perspective, unless your DrupalCamp truly has a separate business entity behind it (LLC, non-profit, etc.) the money still gets traced back to whatever company/person owns the PayPal account. In this case, is it still worth it to pay all of PayPal's fees just to for the convenience of keeping the money in separate places?

Thoughts?

Comments

partner

ultimike's picture

What we've done in Florida is found a local partner to work with us in putting on the camp. We're working with the Central Florida Computer Society (CFCS), a local 501(c)(3) that we're able to run all the finances through. They've been amazing partners, and we're repaying them by building a new site for them during our camp's Coding for a Cause day. We've been extremely fortunate with them, as CFCS doesn't charge us for the service.

We have sponsors write checks directly to CFCS, as well as utilize their PayPal account for registration. When paying vendors, if we have enough lead time, CFCS will cut them a check directly, or one of the camp organizers will pay the vendor and get reimbursed by CFCS.

Other camps utilize the Drupal Association as their fiscal agent (a system that is still currently being tested, so don't necessarily count on it) or set up their own LLC or non-profit in order to get a bank account to run finances through.

-mike

Mostly Sponsors & Partners

mike stewart's picture

DrupalCampLA, at least the last two, we've tried to have sponsors deal directly with venue or after party venue (typically being largest costs) as much as possible.

For 2010 we also utilized Drupalcon Inc..

--
mike stewart { twitter: @MediaDoneRight | IRC nick: mike stewart }

As I wrote below, I'm

christefano's picture

As I wrote below, I'm personally not a fan of having sponsors deal directly with venues and vendors. I can see how this might work fairly well for smaller events but with large ones with a lot of expenses it just involves too much supervising to make sure everything goes smoothly.

LA Drupal and the LA Drupal Association

christefano's picture

In the past, LA Drupal ran everything through a private bank account. Using private accounts (whether it's a personal bank account or one's business account) is a fairly common practice for many camps, but in our case several of us got increasingly uncomfortable with this for various reasons and wanted a better way for LA Drupal to manage community funds. A few months before DrupalCamp LA 2010, I proposed creating an legal association with its own bank account and together with a few LA Drupal organizers, formed the LA Drupal Association before the end of the year.

The LA Drupal Association is basically a DBA or unincorporated association (also called a voluntary association in some states) with the names of several LA Drupal organizers listed as officers and a trusted individual as the treasurer. After we filed the paperwork with the State of California, we were assigned an EIN and took our paperwork to a local paper to have our DBA information printed for 30 days. After those 30 days passed, we received a "proof of publication" letter from the newspaper and took that to the bank to open a business account for our user group.

This is pretty standard stuff. I modeled how we did this based on what home owners associations do, so we didn't invent anything new. Other Drupal user groups, such as the San Diego group, have since done the same to manage funds for their camps.

This process took us many months, in part because the price for registering a DBA went up after we mailed the paperwork and cashiers check. So, the paperwork was rejected and we had to start over again. If doing this again, I would probably not rely on the postal mail system and instead do everything in person.

Since the LA Drupal Association hadn't been formed yet in time for DrupalCamp LA 2010, we primarily used our venue, UCI (the University of California, Irvine), as our fiscal agent up to the point that we covered our venue costs. This wouldn't have been possible without our venue coordinator, John Romine, who acted as a liaison between LA Drupal and UCI and watched our venue budget like a hawk.

It was very unlikely that a UC (University of California) organization would return any surplus sponsorships and donations to us (besides, we didn't even have a bank account yet), so to handle the inevitable surplus I reached out to DrupalCon Inc., which had just been the fiscal agent for DrupalCon San Francisco. Several members of the Drupal Association had been using DrupalCon, Inc. as the fiscal agent for their regional DrupalCamps. They worked with LA Drupal as part of a pilot program to see if DrupalCon, Inc. could formalize this program and scale to accommodate more camps.

At last week's DrupalCamp Organizing BoF at DrupalCon Chicago, Jacob Redding, Greg Knaddison and Cary Gordon from the Drupal Association gave us an update and said the Association is still working on the infrastructure necessary for it to become the fiscal agent for future camps. I expect someone from the Association will post to the Association blog or elsewhere in the Drupal Event Organization group when they have news.

For Drupal Design Camp LA 2011, we used our newly formed LA Drupal Association as the fiscal agent. Sponsors simply wrote checks directly to LA Drupal Association and organizers wrote checks directly to the venue, vendors and organizers who needed reimbursement for conference-related costs. It was much easier compared to how we did things for DrupalCamp LA 2010. The word blissful comes to mind.

I'm personally not a fan of having sponsors deal directly with venues. It just involves too much supervising to make sure everything goes smoothly.

The bottom line
From an accounting perspective, unless your DrupalCamp truly has a separate business entity behind it (LLC, non-profit, etc.) the money still gets traced back to whatever company/person owns the PayPal account. In this case, is it still worth it to pay all of PayPal's fees just to for the convenience of keeping the money in separate places?

This is only if you open a personal PayPal account. LA Drupal's PayPal account is a business account that is owned by the LA Drupal Association but lists our treasurer as the contact person.

PayPal should be the last resort for receiving donations and sponsorships, in my opinion. PayPal may be a necessary evil in business but I can easily see a user group operating entirely without the hefty risks and transaction fees associated with PayPal. Bank transfers are easiest, checks are second easiest and PayPal is the least preferred. Yes, this is the exact opposite to how many people see PayPal in the normal business world.

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