Finance glossary
Finance terms, explained simply.
Plain-English definitions of the finance terms every chapter treasurer needs to know – dues, ACH, budgets, reserves, chargebacks, and more.
12 terms
Dues & Billing
- ArrearsMoney a member owes that is past its due date; being 'in arrears' means behind on payments.
- Chapter DuesThe recurring fees each member pays to belong to a fraternity or sorority chapter, covering the chapter's operating costs.
- Delinquent AccountA member account that is significantly overdue on payment.
- Early-Bird DiscountA reduced dues amount for members who pay before an early deadline.
- House Fee (Parlor Fee)A charge that helps cover the costs of operating and maintaining a chapter house, sometimes billed to all members.
- InstallmentA single scheduled payment within a larger payment plan.
- Late FeeAn additional charge applied when dues are not paid by the deadline.
- National DuesThe per-member fee a chapter owes to its national or international headquarters.
- New Member FeesOne-time fees charged to new members for initiation, badges, and onboarding, on top of regular dues.
- Parlor FeeA parlor fee is a charge billed to members who live outside the chapter house to cover their share of house upkeep, meals, and common spaces.
- Payment PlanAn arrangement that lets a member pay dues in several smaller installments instead of one lump sum.
- Social FeeA portion of dues (or a separate charge) that funds a chapter's social events and programming.
10 terms
Payments & Banking
- ACH (Automated Clearing House)A US bank-to-bank electronic transfer network, used for low-cost direct payments from a member's checking account.
- ACH ReturnA failed or reversed ACH payment, commonly due to insufficient funds or a closed account.
- Buy Now, Pay Later (BNPL)A financing option that lets a payer split a purchase into installments, often interest-free, paid to the provider.
- ChargebackA forced reversal of a card payment initiated by the cardholder's bank, usually after a dispute.
- Payment DisputeA cardholder's formal challenge to a charge, which can lead to a chargeback.
- Payment Processing FeeThe charge a payment processor takes to handle a transaction, often a percentage plus a fixed amount.
- Payment ProcessorA company that handles electronic payments between a payer and the recipient's bank account.
- PCI ComplianceAdherence to the security standards that protect cardholder data during payment handling.
- RefundReturning a payment to the member who made it, in full or in part.
- SettlementThe transfer of collected funds into the chapter's bank account after payments are processed.
11 terms
Budgeting & Accounting
- Accounts PayableMoney the chapter owes to others – vendors, the national organization, or members awaiting reimbursement.
- Accounts ReceivableMoney owed to the chapter that has not yet been collected – primarily unpaid dues.
- Cash ReserveMoney a chapter keeps on hand to absorb unpaid dues, emergencies, or slow terms.
- Collection RateThe share of billed dues that a chapter has actually collected.
- Expense ReportA documented request for reimbursement that itemizes a purchase and attaches a receipt.
- Fiscal YearThe 12-month period a chapter uses for budgeting and financial reporting.
- LedgerThe complete record of a chapter's financial transactions – money in and money out.
- Line ItemA single entry for a specific income source or expense in a budget or ledger.
- Operating BudgetA chapter's plan of expected income and expenses for a term or year.
- Outstanding BalanceThe amount a member still owes after any payments made so far.
- ReimbursementRepaying a member for an approved expense they paid out of pocket on the chapter's behalf.
7 terms
Chapter Finance
- 501(c)(7)The US tax-exempt classification for social and recreational clubs, which many fraternities and sororities fall under.
- Chapter TreasurerThe officer responsible for a chapter's finances – collecting dues, paying bills, and keeping records.
- Financial AuditA review of a chapter's financial records to verify they're accurate and complete.
- Officer TransitionThe handoff of a role and its records from an outgoing officer to the incoming one.
- Philanthropy BudgetThe funds a chapter sets aside for charitable events and donations to its philanthropic causes.
- Recruitment BudgetThe money allocated to recruiting new members – events, materials, and registration costs.
- VP of FinanceThe finance officer title used by many sororities and some councils, equivalent to a treasurer.