Operational audits are a valuable tool for nonprofits to maintain good governance, financial integrity, and effectiveness in achieving their mission. They contribute to the long-term sustainability and success of the organization and reinforce trust amongst stakeholders.
The DevoCenter Compliance Checklist is divided into 4 sections:
Maintaining Board Minutes
Maintaining board minutes is an important part of nonprofit governance and accountability. The minutes provide legal protection, support transparency, and serve as a valuable historical reference for the organization. By establishing a systematic process for capturing and retaining accurate minutes, nonprofits can ensure they operate with integrity and fulfill their mission effectively.
Process Summary
Minutes should accurately capture all discussions, decisions, and resolutions made during board meetings
Minutes should be prepared promptly after the board meeting to ensure accuracy
Minutes of the previous meeting should be reviewed and approved at the beginning of the next meeting
Minutes should be retained for a specific period as required by organizational policies
Minutes should be accessible to authorized individuals for review
Minutes should be signed by the board secretary or authorized officer to verify accuracy and authenticity
Meetings should be at the frequency indicated in the bylaws, and minutes should be available for each
Why Do We Need Board Meeting Minutes?
Board minutes are written records of the proceedings and decisions made during board meetings. These minutes are legal and historical documentation that helps the nonprofit remain compliant, transparent, and accountable to its stakeholders.
Legal Compliance and Governance: Nonprofit organizations are subject to various laws and regulations, and maintaining board minutes is a legal requirement for any nonprofit filing a 990. The minutes provide evidence that the board is fulfilling its duties, acting in the best interest of the organization, and adhering to its bylaws and articles of incorporation.
Liability Protection: In the event of legal disputes or investigations, minutes act as a defense to demonstrate that decisions were made with due diligence and in accordance with the nonprofit's policies and objectives. This can help shield individual board members from personal liability.
Transparency and Accountability: Board minutes help stakeholders to understand how decisions are made and resources are allocated. Transparent governance increases trust and confidence in leadership, which is essential for strong partnerships.
Historical Record: Board minutes provide valuable insights into the organization's progress, challenges, and strategic direction over time. Having access to past minutes can be beneficial for new board members and leadership, ensuring continuity and informed decision-making.
Use this list to get organized before you start soliciting funds
Administrative
IRS Determination Letter (501c3)
Signed W9
Recent 990
Staff Bios/ Resumes
List of Board Members and Partners
Financial
Operational Budget
Actual Program Budget
Requested Program Budget
Income statements
Audited financials
Grants.gov /login.gov access information
Program
Mission Statement
Organization’s History
Draft Letter of Inquiry
Logic Model or Program Overview
Program or Event Description
Impact Statement
Case for Support
Project Plan with Timeline
Sustainability Plan
Service Numbers and Demographics
Nonprofit Compliance | Annual Board Checklist
Board members are expected to provide leadership to a nonprofit organization. They are responsible for establishing policy and ensuring compliance, while the executive director (ED) is responsible for implementation and operational oversight. Boards will function differently based on size, history, leadership styles and other factors, however, there are a few things that all boards should do at least annually.
Bylaws and Governance Policies
Board members should be aware of and have easy access to corporate documents: bylaws, conflict of interest policy, articles of incorporation, IRS determination letter, meeting minutes.
Annually board members should review bylaws and submit certifications to confirm that they understand and agree to abide by the conflict of interest and other governance policies.
Accounting, Filings and Insurance
Confirm state filings, charity registrations, employment taxes, insurance, and business licenses (if required) are current.
Examine accountants audit and federal 990 or 990N filings; verify tax exempt status.
Review financials, approve budget (including Executive Director compensation); evaluate cash flow.
Vision, Mission and Outlook
Revisit the vision and mission of the organization, and ensure alignment to current strategy and planned activities.
Brand Presentation
Examine website, newsletter, social media channels, proposals, and printed media to assess readiness to share with program participants, donors, partners, funders and friends.
Partnerships and Fundraising
Discuss, identify and list current and potential partners and funders. Determine outreach, relationship building and proposal submission strategies.
Organizational Development
Participate in Executive Director and board member recruitment.
Ensure Executive Director has adequate resources to meet organizational objectives. Review board, staff and volunteer roles and responsibilities to determine if current capacity meets program requirements.
* This checklist is for quick reference and for informational purposes only. It is not meant to replace legal advice.
References:
repost from Boardable | The Nonprofit Board Governance Guide
Agenda and Minutes: These items help your members always have up-to-date details on meetings and recent history. Check your state laws to see if there are requirements for how long you keep these records and whether they need to be publicly accessible.
Bylaws: These ensure your meetings run smoothly and that members know your expectations. They also spell out procedures for common issues from voting procedure to board member attendance.
Strategic Plans: Whether they are long-term or short-term, board members need to document strategic plans to be able to provide you with the best insight and assistance for moving forward.
Your History and Mission: Members should always know who your nonprofit serves, and why you do what you do. It’s a good idea to review your history and mission at board retreats and make sure everyone is on the same page.
Board Expectation Agreement: This essential document outlines exactly what you expect from board members in detail, avoiding miscommunication or unwanted results. It should include topics such as attendance, personal donations, fundraising support, ambassadorship efforts, and anything else your organization expects board members to do.
Board Member Job Description: Specific details of what board membership looks like and how directors serve your board helps prospective members decide if board service is for them.
Committee Charges: Details about what a committee does, who is responsible for it, and how decisions are made set this reporting structure up for success.
Legal Documents: From your articles of incorporation to your legal status and other essentials, have important legal documents available for board members to easily access.
Financials: Budget, financial statements, and your last annual audit results are among the important documents that boards need to make decisions. Again, check with local laws about requirements for what needs to be made public and how long documents need to be retained.
Contact Details: Maintain this information for the current board, any active emeritus members, and key executive employees. Identify who emergency contacts are in various situations and consider making contact info shareable (as desired) among board members.
Calendar: A clear, easy-to-understand calendar of your upcoming events, activities, and important dates for your nonprofit—updated every meeting—ensures better attendance.
Here’s a list of documents that should be readily available to board members and prepared before you begin fundraising. Create a shared folder with the following:
Administrative
Original Incorporation Documents
Updates/Amendments to the Incorporation (Name or Changes)
Bylaws (signed by Board Members and dated)
Conflict of Interest Statement (signed by Board Members and dated)
501c3 Application and or Documentation
IRS Determination Letter
Solicitation License (if applicable)
Proof of Lease Agreement/Ownership of Property (if applicable)
Insurance Certificate
Certificate of Good Standing
Board Meeting Minutes
Financial
Financial Reports
Operating Budget
Program Budgets
All Previous Award Letters
Program
Staff Resumes
Calendar of Events
Scope of Services
Annual Reports
Performance Reports
At least 3 Support Letters (Organization and Program)
Newsletter and/or Press Releases
The purpose of the conflict-of-interest policy is to protect a nonprofit’s interest when entering into a transaction or arrangement that might benefit the private interest of an officer, director, the Organization or might result in a possible excess benefit transaction. The policy is intended to supplement but not replace any applicable state and federal laws governing conflict of interest applicable to nonprofit and charitable organizations.
Conflict of Interest Policy Template