Strong policies make for effective nonprofit boards
Between accounting standards, tax reform, fundraising, and program delivery, many not-for-profits (NFPs) are stretched to their limits. So, when it comes to creating or updating policies, it’s easy to push those tasks to the bottom of the list. Having strong policies in place, however, can protect your NFP from liability, help you adopt consistent and clear actions, and help you use your limited resources more efficiently. Sound policies can also help your governing board provide more effective oversight.
Getting started is half the battle when it comes to creating or updating policies. The following steps can help you get the ball rolling.
1. Inventory the policies that are currently in place.
This may require some digging if you don’t have a central repository for your policies; it also may include reviewing past board meeting minutes. As you identify the policies, create an index that lists all of them in one place. Include the date the board originally approved the policy and any subsequent dates they were reviewed and/or updated. The index can help you identify the policies that haven’t been reviewed recently and finalize those that were never approved by the board.
2. Consider what policies should be in place and what they should include.
Once you’ve identified the policies the organization has in place, consider what might be missing. Policies that an organization may wish to consider having in place include the following (samples of most of these are available for AICPA Not-for-Profit Section members here):
Read the complete AICPA.com post.