It’s important for nonprofit board officers to know exactly what their obligations are to the organization, as well as what responsibilities they can expect in their role. And who wouldn’t want to be prepared when taking on a new title?
According to the attorneys at Charitable Allies, not only can establishing clear board expectations prevent unnecessary board conflict, this can also protect your nonprofit from liability and other common board mistakes. That’s why we’re outlining some common responsibilities for board roles, starting with the Board Treasurer.
Who Makes a Good Board Treasurer?
Since nonprofit board treasurers manage the organization’s budget and other relevant records, this person should have experience in keeping track of financials. That being said, it’s fine if they aren’t an accountant or CPA—many nonprofits outsource their bookkeeping. Ultimately, a good board treasurer is familiar with financial organization, has a knack for overseeing where money goes, and has a high level of integrity. You can learn more about other board officer roles here if you’d like to see an overview of how treasurers fit in the bigger picture.
Common Board Treasurer Responsibilities
1. The obvious one – managing money
As previously mentioned, the treasurer does not have to be an accountant or operate as one, but they should have an accurate understanding of how the organization’s budget and spending needs to play out in the real world. Even if they are not as hands-on as staff members who may deal with the organization’s expenses daily, the board treasurer is responsible for the overall cash flow. The treasurers for smaller nonprofits may be more involved in the day-to-day financials, while treasurers of larger nonprofits may work with staff in the bookkeeping department to get the bigger picture of the organization’s financial status.
The treasurer should be able to brief the board of directors on how the organization is doing financially and provide relevant reports during meetings. They should have a plan for any outstanding debts or bills, be able to account for purchases, and anticipate future expenses. They also typically participate in the organization’s audits. No matter the organization’s size, the nonprofit board treasurer should be in the loop with where the nonprofit’s money is coming and going.
2. Organization oversight
A nonprofit board treasurer ensures that best practices for financials are in place for the organization. This can include creating policies and systems for accountability, overseeing the board finance committee, and/or making sure 990s are completed in a timely manner. If accountants are outsourced, they often manage that relationship, too.
For example, the board treasurer is usually a signatory on bank accounts, and may have more than one pair of eyes on checks to approve expenses. In a larger organization, this may look more like developing policies that govern how staff can handle money to keep transactions both ethical and secure. Treasurers build the guardrails that help the nonprofit succeed while also protecting it from theft or disorganization.
3. Strategic Leadership
Like any other board member or officer, treasurers play a key role in helping nonprofits not only stay compliant but truly thrive! Treasurers can be a valuable resource when the board of directors seeks data to inform decisions or come up with new ideas.
One example of this could be a board treasurer providing insight at a board meeting where the expansion of a new program is being discussed. The treasurer might offer input on the financial feasibility of the expansion or help other board members understand potential financial risks or rewards. Treasurers who go above and beyond can spot trends in the records or blind spots in financial processes, and even if the issue on the table isn’t related to audits or budgets, treasurers bring a unique perspective due to their knack for numbers.
Tips for Board Treasurers
- If you’re new to the board, spend time getting up to date on the budget and past financial patterns. Meet with the outgoing treasurer or bookkeeping staff so you can familiarize yourself with the organization’s current processes.
- Be on the lookout for any policies that need updated in regard to the organization’s financials. Notice any “holes” or “unlocked doors” in the way people can access or approve funds, for example.
- Prioritize consistent and accurate documentation. Don’t make unapproved decisions that don’t leave a paper trail. Lead by example!
- Keep yourself up to date on any deadlines (for example, deadlines for filing 990s) and important dates (for example, the next board meeting or #GivingTuesday). Update your calendar accordingly.
- If you need assistance with your bookkeeping, don’t hesitate to reach out to a nonprofit bookkeeper who can consult on best practices, policies, and more.
Supporting Your Board Treasurer
Are you a newly elected board treasurer looking for some insight on best practices? Are you a seasoned board treasurer looking for assistance with 990s, or even to have a nonprofit bookkeeper do the work for you? Let us know—we’d be happy to help. Being a board treasurer is an important role, and we want to be the ally in your corner.