Fiscal Duties

An essential task that an effective non-profit board must carry out involves "maintaining fiscal responsibility", according to the Panel on Accountability and Governance in the Voluntary Sector.

A charity's board of directors is responsible to ensure that sufficient financial resources are available to pursue the organization's mission and goals. This implies that the board must oversee:

• The raising of funds
• The spending of funds
• The ways in which the funds are accounted for.

What should your board do to be fiscally responsible? Have a look at some essential practices regarding:

• Fundraising
• Expenditures
• Accounting and reporting
  

The Canadian Centre for Philanthropy has developed an "Ethical Fundraising & Financial Accountability Code" that can help guide your board in the ethical fulfillment of its fiscal responsibilities. Some funders are now requiring that boards of funded organizations adopt this code as policy.

To determine whether your board is maintaining fiscal responsibility you could examine a number of performance indicators.

Your board must always remember that your organization is in a position of public trust. By being granted charitable or nonprofit tax advantages, your board is being entrusted with the public's money. In accepting donations and grants, your board is being entrusted with the contributor's money. You consequently have ethical and legal obligations to care for this money in a responsible manner.

In fact, you and your fellow board members can be held personally liable for outstanding debts, wages and benefits in the event the organization cannot meet its financial obligations. It is therefore in the best interests of both the organization and you to ensure that finances are managed in a way that safeguards the organization's future.

For a deeper understanding of your board's fiscal responsibility, go on a fundraising and financial accountability scavenger hunt.

<<previous | next>>