This document discusses the compliance and governance responsibilities of not-for-profit board members. It covers topics such as fiscal oversight duties including duty of care, loyalty and obedience. It also discusses accounting systems, internal controls, financial statements, audit requirements and compliance with regulations for not-for-profits. The presentation provides an overview of the roles and responsibilities of not-for-profit boards to ensure proper financial oversight, reporting and compliance.
Nonprofit Board of Directors Best Practices Grace Dunlap
In this 1-hour webinar hosted by CharityNet USA, we review the 20 best practices for nonprofit board of directors. For more information on nonprofit startup, visit: charitynetusa.com/nonprofit_startup.php
The Essentials of Board Governance
Presented by Fran Whittenburg Alvis, Homeless & Housing Coalition of Kentucky
The Board of Directors sets the tone and direction of the organization. Creating an effective Board is a continual
process that includes recruitment, engagement, and development. Effective Board leadership and governance helps ensure that an organization can operate at its fullest capacity. Whether you are the CEO of the agency or serve on the Board of the agency, this session will give you the tools to use to improve the effectiveness of your Board.
This presentation was prepared to support the induction process of new Board members of a Board I chaired for several years. It presents basic and introductory information sourced from various experts. It was intended to help Board members understand the role of the Board, their role as Board members and the difference between Board/policy and Operational roles. Feel free to use and adapt this slide show. I know how hard it is to Chair a volunteer Board and how frustrating it can be having to reinvent the wheel for processes like Board member induction. Some pictures would probably help this. A manual was also produced for distribution to Board members and that has been uploaded to Scribd.
When a Board of Directors serves in a governing capacity (e.g. for a non-profit, a public agency, or a corporation), the Board needs to act in certain ways in order to assure high levels of performance throughout the organization. This tool lays out the five habits of high-performing governing boards.
This tool was designed to help nonprofit organizations assess their organizational capacity against a number of best practices recommended by the Center for Nonprofit Resources (C4NPR.org – Toledo, OH).
Each organization will need to decide for itself what changes, if any, to make in its governance and management policies and practices based on the self-assessment.
In this age of tough competition for funding, having a strong and engaged board is the key to long-term sustainability.
Nonprofit Board of Directors Best Practices Grace Dunlap
In this 1-hour webinar hosted by CharityNet USA, we review the 20 best practices for nonprofit board of directors. For more information on nonprofit startup, visit: charitynetusa.com/nonprofit_startup.php
The Essentials of Board Governance
Presented by Fran Whittenburg Alvis, Homeless & Housing Coalition of Kentucky
The Board of Directors sets the tone and direction of the organization. Creating an effective Board is a continual
process that includes recruitment, engagement, and development. Effective Board leadership and governance helps ensure that an organization can operate at its fullest capacity. Whether you are the CEO of the agency or serve on the Board of the agency, this session will give you the tools to use to improve the effectiveness of your Board.
This presentation was prepared to support the induction process of new Board members of a Board I chaired for several years. It presents basic and introductory information sourced from various experts. It was intended to help Board members understand the role of the Board, their role as Board members and the difference between Board/policy and Operational roles. Feel free to use and adapt this slide show. I know how hard it is to Chair a volunteer Board and how frustrating it can be having to reinvent the wheel for processes like Board member induction. Some pictures would probably help this. A manual was also produced for distribution to Board members and that has been uploaded to Scribd.
When a Board of Directors serves in a governing capacity (e.g. for a non-profit, a public agency, or a corporation), the Board needs to act in certain ways in order to assure high levels of performance throughout the organization. This tool lays out the five habits of high-performing governing boards.
This tool was designed to help nonprofit organizations assess their organizational capacity against a number of best practices recommended by the Center for Nonprofit Resources (C4NPR.org – Toledo, OH).
Each organization will need to decide for itself what changes, if any, to make in its governance and management policies and practices based on the self-assessment.
In this age of tough competition for funding, having a strong and engaged board is the key to long-term sustainability.
Slides from a talk on how to train and run a non-profit Board of Directors. Focus on non-profits with high board turnover and relatively inexperienced board members.
Discover how to make your Board of Directors a dynamic, supportive group of volunteers. This webinar cover the basics of the book The ABCs of Building Better Boards. It will motivate and inspire volunteers and staff to raise the bar for performance for the Board of Directors.
• Learn from one of the world’s experts the latest trends that board directors need to know.
• Know your liabilities as a board director and review your approach to risk.
Angie Salmon leads the Corporate Directors Search practice at EFL Associates. She facilitated a panel discussion at a recent National Association of Corporate Directors (NACD) meeting covering corporate board succession planning, director recruitment, composition and diversity, board leadership structures and board assessments.
Practical Issues of NGO Governance - Ivan YIU's Presentation in HKICS IVANYIU3
The presentation focused on three areas of common concern of NGO governance : (i) Board-management relationship, (ii) Governance role on risk control and compliance and (iii) Performance accountability
The Stand for Your Mission campaign is a challenge to all nonprofit decision-makers to stand up for the organizations they believe in by actively representing their organization’s mission and values, and creating public will for positive social change.
Presentation on Governance of nonprofit in CSO Partners Workshop "Opportunities in Challenging Times - A Workshop for NGOs" held on September 14-15, 2009 at Secunderabad
Meanings of Governance
Tests of Good Governance
Governance Common Issues and Problems
Good Governance Guiding Principles
Levels of Governance
Characteristics of Good Governance
Key Cooperative Actors
Functions of the Board of Directors
Board Good Practices
Board Relationships
Slides from a talk on how to train and run a non-profit Board of Directors. Focus on non-profits with high board turnover and relatively inexperienced board members.
Discover how to make your Board of Directors a dynamic, supportive group of volunteers. This webinar cover the basics of the book The ABCs of Building Better Boards. It will motivate and inspire volunteers and staff to raise the bar for performance for the Board of Directors.
• Learn from one of the world’s experts the latest trends that board directors need to know.
• Know your liabilities as a board director and review your approach to risk.
Angie Salmon leads the Corporate Directors Search practice at EFL Associates. She facilitated a panel discussion at a recent National Association of Corporate Directors (NACD) meeting covering corporate board succession planning, director recruitment, composition and diversity, board leadership structures and board assessments.
Practical Issues of NGO Governance - Ivan YIU's Presentation in HKICS IVANYIU3
The presentation focused on three areas of common concern of NGO governance : (i) Board-management relationship, (ii) Governance role on risk control and compliance and (iii) Performance accountability
The Stand for Your Mission campaign is a challenge to all nonprofit decision-makers to stand up for the organizations they believe in by actively representing their organization’s mission and values, and creating public will for positive social change.
Presentation on Governance of nonprofit in CSO Partners Workshop "Opportunities in Challenging Times - A Workshop for NGOs" held on September 14-15, 2009 at Secunderabad
Meanings of Governance
Tests of Good Governance
Governance Common Issues and Problems
Good Governance Guiding Principles
Levels of Governance
Characteristics of Good Governance
Key Cooperative Actors
Functions of the Board of Directors
Board Good Practices
Board Relationships
If you're an Internet marketer and have to do any kind of site audits, you may benefit from this presentation. It culminates in a Google Doc with 300+ audit checkpoints.
The most comprehensive definition of internal audit is given by the IIA, USA. It is,
"Internal auditing is an independent, objective assurance and consulting activity designed to add value and improve an organization’s operations. It helps an organization accomplish its objectives by bringing a systematic, disciplined approach to evaluate and improve the effectiveness of risk management, control and governance processes."
The purpose of the presentation is to provide clarification for a better understanding of what internal audit definition, objectives, functions, stages and reporting are all about? What difference does it make in the presence of an external audit? How different is its scope from that of the external audit? How internal audit standards contribute to better performance of internal audit work and its reporting to the Board or Audit Committee?
Board Fiduciary Duty Relating to the Annual Audit and Form 990Ballstate1
Joyce Dulworth, CPA and tax partner with BKD LLP, along with Michael Earls, CPA, presented this topic during the 2013 Ball State Foundation PAC Seminar.
Financial Accountability for Board Members. Sponsored by the Lafayette Community Foundation and the Indiana Nonprofit Resource Network, this program provides basic information and tools to help nonprofit board members understand and comply with their fiduciary responsibilities
Presentation on finance fundamentals for nonprofit organizations. Geared towards non-accountants, this presentation deals with the following:
- Characteristics of nonprofits and responsibility for financial information
- Basic review of accounting principles
- Financial statements
- Different members of the finance team
- Financial policies for nonprofits
- Communicating financial results
- Nonprofit tax
BDPA Charlotte chapter hosted Jan 2010 program meeting on the topic, "Running a Small IT Consulting Firm". The speaker was John Hoffler. This is the .ppt presentation that Mr. Hoffler used for his presentation.
Compliance And Governance For Not For Profit Board Members
1. Compliance and Governance Responsibilities of Not-for-Profit Board Members Instructors: John E. Adams CPA, Partner, Adams & Co. Certified Public Accountants and Consultants
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
17.
18.
19.
20.
21.
22.
23.
24.
Editor's Notes
March 25, 2010 6:30pm-8:30pm
GOAL: To provide an overview of financial policies, controls, and reports. This is not a workshop to turn you into a finance professional. We will trade comments. Feel free to ask questions at any time.
The ultimate authority for managing the affairs of the organization is vested in the Board of Directors. Because the law grants Directors such authority, the law also imposes on Directors an obligation to act in the best interests of the organization.
Duty of Care = Duty to be Informed Directors must attend Board meetings. Directors who do not attend meetings are nevertheless bound by actions taken at those meetings and may be held responsible if any such actions are deemed negligent. The act of failing to attend Board meetings may itself be deemed to be negligent behavior. While the Board makes the important policy decisions that guide and determine the activities of the organization, the Board must rely on others (e.g., management, accountants, attorneys, etc.) to carry out the decisions. Such delegation is necessary and legal. A Board must monitor those to whom it has delegated authority to make sure such persons are acting responsibly. Delegation does not relieve a Board of liability.
The best interests of the organization must prevail over any individual interest of the Director, his/her employer, and his/her family and associates. We will discuss implementing a Conflict of Interest policy a bit later.
Included as a question on Form 990 This is in conjunction with the Duty of Loyalty discussed earlier See sample policy from Donors Forum of Chicago Generally includes: Disclosure of potential conflicts Recusal of conflicted member from deliberations and voting on the transaction
A Board must assure themselves that information and reporting systems exist in the organization that are reasonably designed to provide to senior management and to the Board timely and accurate information sufficient to allow management and the Board to reach informed decisions. What committees does your organization have? Typical Committee Structures Finance Committee – Primarily responsible for reviewing the overall finances and approving the budget of the organization Investment Committee – Primarily responsible for reviewing investment performance and long-range capital projects Audit Committee - Primarily responsible for engaging the independent CPA firm, reviewing audited financial statements, management recommendation letter, etc. Reference to the AICPA’s “Audit Committee Toolkit” and Grant Thornton’s “Audit Committee Handbook” An organization may be small enough that separate committees may not make sense Choose whichever committee structure works best for your organization Role of the Treasurer Review staff work (e.g., reconciliations and internal financial statements) on a regular basis (e.g., monthly or quarterly). Role will depend on the size/staff of the organization Role of the Staff Carry out the day-to-day work, prepare bank reconciliations, prepare checks, make deposits, prepare financial statements, etc.
Credit to Michael Peregrine of McDermott Will & Emery… Revenue/Expense Management The Board should work closely with management to assure that the organization a) maintains adequate cash reserves and liquid investments to help protect operations from a sharp or unexpected decrease in revenues, b) is being operated in a cost-efficient manner, and c) considers sensitive expense reduction options when necessary (e.g., reductions in workforce, salaries, etc.). Strategic Flexibility The Board should be prepared to consider alternative strategic options through which the organization’s mission can continue. Items to consider may include: change of management control, partnering with similar organizations, and continuing to evaluate options with expert advice and counsel. Compliance With Debt Covenants Debt covenants under bond indentures and commercial loan documents may act as an “early warning” sign that an organization’s financial performance may be declining. The Board should work closely with management to understand an organization’s debt covenants, monitor compliance continuously, and assure prompt disclosure of any violations and other material adverse events.
What is an accounting cycle? Cash Receipts Cash or check in mail received at receptionist or at special event > mail opened > deposit prepared > deposit made > receipt recorded in GL Cash Disbursements Initiate and approve purchase > invoice received in mail > invoice approved > expense recorded in GL > check prepared > check signed > check mailed Payroll Master file info prepared > timesheet prepared > timesheet approved > payroll run prepared > payroll run approved > payroll checks or direct deposit transfers prepared > checks disbursed or transfers made > reconciliation to GL
Why are internal controls a good thing? Helps to prevent or detect errors and fraud Make sure Internal Controls are being applied to all accounting cycles Overriding control procedure - separation of duties and board oversight (especially when an organization has limited staff to completely segregate duties) Examples of Controls / Best Practices Cash Receipts – checks should be stamped “for deposit only”; receipts posted to GL by someone other than those opening mail and handling receipts; daily deposits; surety/bonding insurance Cash Disbursements – pre-numbered checks; signing of blank checks prohibited; bank statements to be sent directly to the Board Treasurer; responsible official to review bank reconciliation prepared by accountant; disbursements posted to GL by someone other than person preparing checks, approving invoices, and signing checks; use of positive pay or reverse positive pay Mention any recent examples regarding NFP fraud in the headlines
Board should ask staff to formulate and implement Internal Controls, as necessary.
See sample financial statements Caveat – This is just an overview
Financial Controls Earlier, we discussed the Duty of Care which equates to the Duty to be Informed One of the Board’s responsibilities in this area is to oversee the organization’s financial affairs, including making sure the organization has adequate internal accounting systems and controls. The Board should approve the organization’s annual budget. Board members should expect the staff to produce timely and accurate internal financial statements and other financial reports, such as actual-to-budget reports with variances explained, on an ongoing basis. It is essential that you, as Board members, understand the financial statements of your organization and the ability to recognize a “red flag” when you see one. Safeguarding Assets The Board should oversee the effective use of the organization’s resources to ensure the organization’s assets are not misapplied or wasted. Internal policies and controls should be adopted and large and unusual transactions should be reviewed to ensure that the organization’s assets are not being misapplied or wasted. In regards to investment matters, Directors are not expected or legally required to be experts in investment matters. Retention and reliance on advisors with good reputations is considered the exercise of prudence. However, Directors are not relieved of their fiduciary obligations when delegating responsibility to others. Does your organization have a written investment policy? Variance Analysis May include reviewing actual-to-budget and current-to-prior period results Significant differences should be investigated to answer: Why the variance occurred, and What revisions to the organization’s budget or plans need to be made, if any. May indicate “red flags” as well as opportunities to take appropriate action to get things “back on track”
The Board oversees the management team and external auditors. The Board should ensure: Adequate internal controls and best practices Accurate records and meeting of reporting requirements Proper authorization of activities and expenditures Existence of assets Current tax-exempt status and identification of activities that may endanger it All tax and information filings (e.g., payroll, sales, 990s, other) are filed properly and timely
Good practice to have a policy to ensure compliance with the law Included as a question on Form 990 See sample policy from Donors Forum of Chicago
Good practice to have a policy to ensure compliance with the law Included as a question on Form 990 See sample policy from Donors Forum of Chicago Applies to Board and staff members The policy should define the responsibility of when and to whom to report suspected misconduct May include a 24 hour anonymous hotline ACFE – Q: What is the #1 method that fraud was discovered? A: Tips
Tax and Reporting IRS Form 990 is due annually on the 15 th day of the 5 th month; up to two 3 month extensions Illinois Attorney General Form AG990-IL is due annually for 501c3 organizations 6 months after year-end; first extension of 60 days with a second extension of 2 ½ months for cause (must include draft and signed copy of Form AG990-IL, draft Form 990, draft audited financial statements, $15 fee, and copy of IRS-approved extensions) Payroll tax reporting The Board should make sure that management is properly withholding and remitting payroll taxes as well as employee and employer contributions to retirement plans The organization may be using a third-party payroll service Board members may be held personally liable for non-payment of taxes See CPAsPI Tax and Reporting Guide to Illinois Not-For-Profit Charitable Organizations