1. FINANCIAL RESPONSIBILITIES: Nonprofit Boards Snowy Range Nonprofit Institute August 4, 2009 Bill Taylor, Area Community Development Educator The University of Wyoming is an equal opportunity/affirmative action institution.

2. BASIC FUNCTIONS Protecting the assets of the organization Collecting income Providing oversight and direction for fundraising Paying debts that have been properly documented Recording receipts, disbursements, and necessary adjustments Providing accurate, timely reports UWCES Community Development Education 2

3. FINAL FIDUCIARY DUTY Full board can never delegate its overall fiduciary duty to anyone else Governing board members, committee chairs, senior staff should attain basic level of financial literacy UWCES Community Development Education 3

4. Committees w/ Financial Responsibilities Finance Committee Oversees proper performance of all financial operations Regularly reviews all financial activity Reviews & discusses budget w/ mgmt before presentation to board UWCES Community Development Education 4

5. Committees w/ Financial Responsibilities (cont.) Audit Committee Selects auditing firm Accepts and reviews reports of external auditors Investment Committee Drafts & oversees investment policies Acts as liaison w/ outside investment advisors Monitors activities of outside advisor 5 UWCES Community Development Education

6. Treasurer Key volunteer financial role for overseeing financial operations Legal responsibility for: Custody of organization funds and securities Keeping full & accurate account of all receipts & disbursements, books, financial records Providing reports to full board As size increases, treasurer will transfer more functions to staff 6 UWCES Community Development Education

7. Chief Executive Shares many of the treasurer’s oversight duties Responsible for hiring and supervising head of accounting staff Responsibility for financial records Level of contractual capability for signing leases, signing checks, negotiating contracts Prepares & presents budget to treasurer or board 7 UWCES Community Development Education

8. Bookkeeper, Controller, Director of Finance Enter financial activity Especially receipts and disbursements Produce timely and accurate financial statements Monitor cash & investment accounts & reconcile with bank & investment statements Prepare payroll 8 UWCES Community Development Education

9. Internal Control Segregate duties so every transaction or activity involves two people 9 UWCES Community Development Education

10. Questions to Ask How do we divide financial responsibilities among various board committees? Financially, what could go wrong in our organization? What procedures do we have in place to prevent or respond to such occurrences? Does the audit committee have a private session each year with the auditor? Do we have the proper staff for our financial activities? 10 UWCES Community Development Education

11. Fundraising Five sources of revenue: Fees or reimbursement for services Investment earnings For-profit enterprises Gifts, grants, and contributions Borrowed funds (should not be used for annual budget needs) 11 UWCES Community Development Education

12. Fundraising (cont.) Important boardresponsibility Begins with developing resources to fully fund operating budget it approves One source is often annual gifts, grants, contributions (annual fund campaign) Requires each board member’s active leadership and support Often includes expectation of board members’ personal contributions 12 UWCES Community Development Education

13. Fundraising: Strategy Success requires board provide overall strategic guidance & direction Based on strategic plan, board defines application of financial & human resources 13 UWCES Community Development Education

14. Fundraising: Strategic Planning Planning exists at several levels: Determination of the general values, vision, mission Broad strategic goals and plans to fulfill the mission Specific tactical objectives to carry out the strategic goals Daily operational plans in line with the objectives 14 UWCES Community Development Education

15. Fundraising: Strategic Planning (cont.) UWCES Community Development Education 15 Values Vision Mission Strategic Goal Strategic Goal Strategic Goal Strategic Goal Strategic Goal Tactical Objective Tactical Objective Tactical Objective Operational Plan Operational Plan

16. Fundraising: Strategic Planning (cont.) SMART strategic goals Specific Measurable Attainable Related Time-based 16 UWCES Community Development Education *SMART GOAL HANDOUT

17. Fundraising: Strategic Planning (cont.) Combined goals and objectives guide fundraising action plan Fundraising action plan establishes types of funds needed based on use Justifies to perspective donors how their funds will benefit organization’s constituents 17 UWCES Community Development Education

18. Fundraising: Participation Board members have responsibility for approving annual budget and fundraising plan and seeing both are carried out May require full participation in fundraising At minimum, requires board’s expertise & active engagement to fund priority needs 18 UWCES Community Development Education

19. Fundraising: Participation (cont.) Other ways board members can participate: Introducing staff & volunteers to prospective donors Setting up face-to-face meetings w/ donors Arranging table of prospects as their guests at a benefit event Adding signature to event invitations Sending personal note or making phone call to donors to thank them for gifts 19 UWCES Community Development Education

20. Fundraising: Oversight Responsibility of board to see strategic plans are followed Board responsible to oversee faithful use of all funds received in accordance w/ donor restrictions, accounting standards, legal & ethical requirements 20 UWCES Community Development Education

21. Questions to Ask Have we participated in forming the organization’s strategic plans for the future? Have we participated in the fiscal strategic plan to finance this future? Do the organizational fundraising plans and operating policies match these strategies? Has the board reviewed and approved the fundraising budget? How do we as a board provide leadership to fundraising committees and activities? 21 UWCES Community Development Education

22. References Lang, Andrew S., CPA. Financial Responsibilities of Nonprofit Boards, Second Edition. BoardSource Governance Series Greenfield, James M., ACFRE, FAHP. Fundraising Responsibilities of Nonprofit Boards, Second Edition. BoardSource Governance Series Taylor, William R.; Hewlett, John P.; Weigel, Randolph R. Strategic Planning and Goal Setting. Enterprising Rural Families: Making It Work, University of Wyoming Cooperative Extension Service 22 UWCES Community Development Education