AUTHOR: April Wheeler - CPA, CGA
To be successful a non-profit or charitable organization must earn the trust and respect of its donors and funders. Due to an organization’s financial management being directly tied to the Treasurer’s responsibilities, their execution of these responsibilities will have an impact on the public’s perception and confidence in the organization as a whole. When an organization is seeking a Treasurer they should keep this top of mind and look for individuals with strong financial literacy skills, attention to detail, timeliness in completing tasks, clear and accurate record keeping and willingness to ask questions.
A Treasurer has the responsibility of managing the financial matters of the organization and ensuring that the Board of Directors, management and volunteers understand the organization’s financial policies and procedures. In addition, most Board positions have term limits and as such the current Treasurer must be able to facilitate the smooth transition of knowledge and responsibilities to the incumbent Treasurer.
The following are some tips, and traps to avoid, to be an effective and successful Treasurer.
Tips for Being Effective
Know who has access to the organization’s funds and the controls in place with respect to the access and disbursement of those funds.
Perform an annual review of the organization’s financial controls and policies to ensure that no changes in the operations have occurred that would necessitate the creation of new or the updating of policies.
Keep a calendar of filing requirements, including deadlines and individuals responsible for those filings (and their backup) to ensure they are all filed on time.
Work with management to develop and/or reinforce strong internal controls and financial management policies.
Ensure an annual budget is prepared that supports the organization’s goals and mission. Review the budget regularly against the actual costs and be prepared to make recommendations to adjust spending as necessary.
Develop a content checklist for information to be included in the monthly Board/Finance Committee financial reporting package.
Ensure all items included in the monthly financial report are reviewed by the Board/Finance Committee and relevant discussions are documented in the meeting minutes.
Perform an annual evaluation of the Executive Director’s performance against the organization’s goals and mission.
Perform an annual evaluation of the external auditor to evaluate their independence, the quality of the engagement team and the level and quality of their service.
Traps to Avoid
Provide legal or tax advice to donor about the deductibility of their donations, contributions or sponsorships.
Fail to ensure the organization keeps, maintains and shares accurate and timely financial records with the Board/Finance Committee.
Neglect to appropriately limit access to and control of the organization’s funds.
Treasurers should be as involved as possible. It is important to be visible and active within the organization such that others know the Treasurer is competent and staying on top of the organization’s financial matters.
For more information on how to be an effective Treasurer, please contact your McCay Duff advisor.
AUTHOR: APRIL WHEELER
April provides services to a variety of clients, including small businesses, not-for-profits, hotels, and commercial leasing enterprises. She takes pride in helping businesses and organizations learn what their numbers mean and how they can contribute to strategic growth.