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The following quotes are taken from a "PTA Money Matters" Manual:

1. The primary emphasis in the Parent Booster Club should be focused upon the promotion of the objects.  The real working capital of a Parent Booster Club lies in its members, not in its treasury.  Fund raising is not the primary function of the Parent Booster Club.
2. The Parent Booster Club is an educational, not a fund raising, organization.  Parent Booster Clubs raise only those funds that are necessary to meet the needs of the year's activities and projects as outlined in a unit's budget.
3. If a product sale is chosen as the Parent Booster Club fund raising activity, members, not students, should be the fund raisers.
4. Parent Booster Club renders a greater service by securing public support for educational and other community needs rather than making gifts to the school.

The Parent Booster Club and the principal must discuss the method in which the Parent Booster Club will handle the funds.  There are two ways a Parent Booster Club may handle their finances:

• The Parent Booster Club may open their own bank account and obtain their own tax exception.  The Parent Booster Club may not use the school’s tax exemption certificate or the purchasing power of the school.  Invoices must be clearly labeled Parent Booster Club.  The Parent Booster Club and the school work together, but are two separate entities.  Upon request and agreement from the parent organization, the Division of Internal Audits may perform an audit.

• The Parent Booster Club may open a restricted account on the school’s books; however, it comes under the same scrutiny as the general fund (see Microcomputer Manual Section 2-4).  The revenue and expenses incurred will be coded to this account to maintain a balance.  The Division of Internal Audits will audit all funds placed in School Activity Accounting.  

In either of these situations, the Parent Booster Club may donate money to the school's general fund for general use or a specific purchase.  Gifts account 119 should be used to receive a general fund gift.

Public chapter 326
“School Support Organization Financial Accountability Act” 
Summary:

Requires school board to adopt a policy regarding local education support groups. Prohibits the authorization of such groups until a policy has been adopted.  Defines student activity funds and school support group organization funds and specifies provisions and restrictions for each.  Prohibits a school employee from acting as a treasurer or bookkeeper for a school support organization.

“School support organization” means a booster club, foundation, parent teacher association, parent teacher organization, parent teacher support association, or any other nongovernmental organization or group of persons whose primary purpose is to support a school district, school, school club, or academic, arts, athletic, or social activities related to a school which collects or receives money, materials, property or securities from students, parents, or members of the general public.

• Any individual, who collects or receives any student activity or other internal school funds, shall turn over to the properly designated school official or employee all student activity or other internal school funds.  Such funds shall be considered student activity or other internal school funds for the purpose of § 49-2-110.  That a member of a school support organization or a person claiming to be a member of a school support organization collected the money is immaterial to the determination as to its status as student activity or other internal school funds.

• School support organization funds that are donated to an individual school shall not be considered as student activity funds.  These funds shall be considered instead as internal school funds from the point of their donation to the respective school.

• A nongovernmental group or organization, including all school support organizations, may not:

• Use the schools’ or school district’s sales tax exemption to purchase items.

• Represent or imply that its activities, contracts, purchases, or financial commitments are made on behalf of or binding upon any school or school district.

• Maintain or operate a bank account that bears the employer identification number of a school board, school, or any other school related governmental entity.  From July 1, 2007, any funds deposited into such an account shall be presumed to be a donation to the entity whose employer identification number is used and shall be treated as student activity funds.

• A school support organization or any group or organization which collects and raises money, materials, property or securities while representing itself to be a school support organization, shall be subject to audit by the office of the comptroller of the treasury.