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Nonprofits Need To Do This For Creating A Strong Oversight

Get Rid Of Non-Performing Board Members

Never allow a board member to remain on the board if they do not show up for meetings, fail to prepare or bring little expertise to the board. It is tough to ask a board member to resign; however your duty of care, loyalty and obedience to the organization demand the replacement of those who do not perform appropriately. According journalofaccountancy.com

Put Real Effort Into Planning The Yearly Calendar

Board meetings must take place at appropriate times for the members to be present and focused on critical tasks and decisions at the right times.  The cycle of the organization will inform the required dates the board has to come together. Duties like approving the audit and reviewing the annual financial statements necessitate board meetings at the due time.  There will also be the need to align board meetings with important committee meetings, so this has to be considered.

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Recruit The Best 

You have to recruit board members who possess the skills and qualities conducive to the goals of the organization.  In the real world, age, race, ethnicity and location should be considered, of course, but skills like accounting, human resources, legal, and real estate should be courted.  It is essential to keep in mind that a motivated and focused board that raises a lot of money is not quite enough.  The board must have the skills to appropriately govern the organization.

Take Minutes, Excellently

Taking minutes is art.  Do not record too much detail.  If you do, this can obscure essential points that demonstrate how the board performed its oversight duties. When making decisions, the names of the board members that voted against a resolution is significant for the record.

 

 

Train Board Members

You have to train the members of the board in their legal and financial basics.  All board members need to understand the core duties of care, loyalty, and obedience.  Equally important is the understanding of board members of the concepts of conflicts of interest and oversight responsibilities.  Board members must comprehend the financial position of the organization. Members without a finance background must be educated toward a basic understanding.

 

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Proper board oversight provides the structure for a non-profit to grow and prosper. A dysfunctional board increases the odds that the organization will end up in deep trouble, many times.  It is all about the board.

Readers should note that this article is only intended to convey general information on these issues and that FAS CPA & Consultants (FAS) in no way intends for the contents of this article to be construed as accounting, business, financial, investment, legal, tax, or other professional advice or services.  This article cannot serve as a substitute for such professional services or advice.  Any decision or action that may affect the reader’s business should not rely solely on the contents of this article, but should rather be consulted on with a qualified professional adviser. FAS shall not be responsible for any loss sustained by any person who relies on this presentation.  This article is subject to change at any time and for any reason.

At FAS CPA & Consultants we have helped both  religious and lay organizations to receive their 501(c)3 exemption status. For a clarification on all requirements and procedures give us a call or mail us and we will help you to choose the most convenient nonprofit structure according to your plan and objectives.

 

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