Nonprofit Accounting Basics

Governance

Oversight: Fiduciary Duty

As the fiduciary of the organization, the board as a body and each individual board member must always act for the good of the nonprofit.

Personal Giving

If your organization does not rely fully on earned income or government grants or contracts, it most likely is involved in raising funds from individuals, foundations, and/or for-profit corporation

Policies

Every nonprofit needs operational guidelines for staff and the board. The purpose of the policies is to serve as a guide for actions and behavior and as a reference for ethical decision making.

Protection

Satisfactory protection against liability (and loss) starts with rigorous risk management.

Reserves

Operational reserves

Operational reserves are funds an organization accumulates over the years by operating with a surplus.

Risk Management Plan

The board bears the responsibility for the safety of the organization.

Role in All Volunteer Organizations

Most nonprofits start as all-volunteer organizations (AVO), without a paid staff. The organization operates with the support of its board and maybe additional volunteers.

Setting Organizational Direction

The board is responsible for defining and guarding its mission, setting the direction for the organization, and ensuring clearly-set values guide every decision.

Simple Governance Steps for Nonprofits

Most nonprofit organizations focus their energy and resources on dedicated causes.

The Basics of Nonprofit Dissolution

Weathering the storm of major disruptions financial disruptions is a challenge for all organizations.

Volunteer Protection Act

The Volunteer Protection Act of 1997 provides personal immunity to individuals who act on behalf of an organization in a volunteer capacity.

Who handles the finances?

Every nonprofit must clarify how the board and the staff interact when handling the financial issues affecting the organization.

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