An active and engaged board is important in safeguarding charitable assets and furthering an organization’s mission. The board of directors of a nonprofit is legally and financially responsible for the conduct of the organization. The treasurer and finance committee performing a monthly review of the organization’s finances is vital in keeping the board informed. The organization’s current financial state assists the board in planning and making decisions.
The following information should be included in the monthly report sent to the board treasurer and finance committee:
- Current bank statement & reconciliation for the month. These should be reviewed for any odd or unusual transactions in the checking account or on the reconciliation.
- Statement of financial position – this is a snapshot of the organization’s assets, liabilities & net assets.
- Statement of activities – this will show the organization’s revenue and expenses year-to-date.
- Budget vs. actual – this report will give a clear picture of where the organization stands related to the board approved budget.
The treasurer and finance committee should review the monthly report for any oddities, major changes, and budget differences. Making sure to follow up with the finance team of the organization regarding any questions. The board having a clear picture of the organization’s finances allows for the most effective governance and support of the nonprofit’s mission.
Please contact the Not-for-Profit Niche team at Gilliam Bell Moser LLP for further guidance.
