Case: Student Activity and Booster Funds — In or Out of Fiduciary?

If you only read one thing Most district-controlled club and athletic fundraising accounts fail the fiduciary test under GASB 84, and belong in the district’s own books. Money truly held for an independent outside organization still passes the test correctly.

Builds on FM9.1 GASB 84’s test requires both control by the government and benefit to parties outside the government. This case applies that test to a situation nearly every district has faced.

Why This Matters

For years, many districts treated student activity funds, class accounts, club funds, athletic fundraising, as Agency Funds, fiduciary, on the reasoning that the money “belonged to the students or the club,” not the district. GASB 84 forced a real reckoning with that assumption, and a lot of districts had to reclassify these accounts entirely.

Scenario A: A School’s Own Booster and Club Accounts

A high school athletic department runs a fundraising account for its own teams. The athletic director approves every disbursement, uniforms, equipment, tournament fees, and the money is raised by and spent on the district’s own students and programs.

Control? Yes, school officials control it directly.
Benefit to parties outside the government? No. The benefit flows to the district’s own students and programs, the same students and programs the district already exists to serve.

Conclusion: this fails the fiduciary test. Since benefit doesn’t flow outside the government, this money belongs in the district’s own books, typically a Special Revenue Fund, restricted to the specific club or team’s purpose, not a Custodial Fund.

Scenario B: An Independent Outside Organization’s Funds

A community youth sports league, a genuinely separate legal entity from the district, uses school facilities for its programs. As a convenience, the district collects gate receipts on the league’s behalf and holds the money briefly before forwarding it to the league.

Control? Yes, the district holds and controls the cash temporarily.
Benefit to parties outside the government? Yes. The money genuinely benefits an independent outside organization, not the district’s own programs.

Conclusion: this passes the fiduciary test. This correctly stays a Custodial Fund, the same pass-through logic FM9.2 covered.

Same district, same kind of “holding money for a team,” two completely different classifications.

How This Applies

If your district still carries student activity or booster funds as Agency or Custodial Funds, this is worth revisiting directly. The test isn’t whose name is on the account, it’s whether the benefit genuinely flows outside the district. Money raised and spent on the district’s own students and programs almost always fails that test now, and belongs on the district’s own books instead.