Ashley Larmore, CPA - May, 2008
At Scinto Graziano, LLP we continually strive to bring our clients and colleagues up to the minute information on tax law changes, accounting changes or changes to rules and regulations that can affect you. Recently, we have had many inquiries regarding the roles and responsibilities of nonprofit board members. Here is some information that may be of interest to you.
Responsibilities of Nonprofit Boards
-
Determine the organization's mission and purpose:
A statement of mission and purposes should articulate the
organization's goals, means, and primary constituents served. It
is the board's responsibility to create the mission statement
and review it periodically for accuracy and validity. Each
individual board member should fully understand and support it.
-
Select the executive director:
Boards must reach consensus on the executive director's job
description and undertake a careful search process to find the
most qualified individual for the position.
- Support
the executive director and review his or her performance:
The board should ensure that the executive director has the
moral and professional support he or she needs to further the
goals of the organization. The executive director, in
partnership with the entire board, should decide upon a periodic
evaluation of the executive director's performance.
-
Ensure effective organizational planning:
As stewards of an organization, boards must actively participate
with the staff in an overall planning process and assist in
implementing the plan's goals.
-
Ensure adequate resources:
One of the board's foremost responsibilities is to provide
adequate resources for the organization to fulfill its mission.
The board should work in a partnership with the executive
director and development staff, if any, to raise funds from the
community.
-
Manage resources effectively:
The board, in order to remain accountable to its donors, the
public, and to safeguard its tax-exempt status, must assist in
developing the annual budget, ensure that proper financial
controls are in place, and oversee the annual financial
statement audit.
- Determine,
monitor, and strengthen the organization's programs and
services:
The board's role in this area is to determine which programs are
the most consistent with an organization's mission, and to
monitor their effectiveness.
-
Enhance the organization's public standing:
An organization's primary link to the community, including
constituents, the public, and the media, is the board. Clearly
articulating the organization's mission, accomplishments, and
goals to the public, as well as garnering support from important
members of the community, are important elements of a
comprehensive public relations strategy.
- Ensure
legal and ethical integrity and maintain accountability:
The board is ultimately responsible for ensuring adherence
to legal standards and ethical norms. Solid personnel policies,
grievance procedures, and a clear delegation to the executive
director of hiring and managing employees will help ensure
proper decorum in this area. The board must establish pertinent
policies, and adhere to provisions of the organization's bylaws
and articles of incorporation.
- Recruit
and orient new board members and assess board performance:
All boards have a responsibility to articulate and make known
their need in terms of member experience, skills, and many other
considerations that define a "balanced" board composition.
Boards must also orient new board members to their
responsibilities and the organization's history, needs, and
challenges. By evaluating its performance in fulfilling these
responsibilities, the board can recognize its achievements and
reach consensus on which areas need to be improved.
I hope you find this information useful. Of course, we are available to answer any questions you may have regarding board member responsibilities, or any tax, audit or accounting queries. Please feel free to give us a call with comments or feedback. Look for more updates from us in the future!
Where ambition and energy meet knowledge and perspective
