When the attorney general calls your office and asks about a board decision, could you find your nonprofit minutes quickly?
Importance of Nonprofit Minutes
You, gentle reader, may think this will never happen to you. You may not even have imagined that it could happen to you. But members of nonprofit boards are beholden to the state in which they are incorporated. As a director or officer, you have a duty to ensure that your organization conducts its affairs properly.
The record of those affairs is—the meeting minutes, approved by the board, signed by the secretary, and properly kept.
Problems with One Location
Recently we’ve encountered several instances in which the minutes reside only on the computer of the secretary. With the usual turnover in volunteer board officers, this means that only one or two years’ worth of minutes are easily accessible. There is no “board book” or official file.
Should any question arise, it would be a painstaking and time-consuming labor (a) to locate the minutes of the meeting in question, and (b) to verify that those minutes are indeed the official record, since only a draft form is available.
Theft and Embezzlement
The news is filled with accounts of theft and embezzlement by trusted members of nonprofit organizations. I’ve encountered several such instances myself in the bodies I’ve belonged to. It is common, it is scandalous, and it often occurs because the board just isn’t paying attention.
[Related: Putting the FUN in Financial Statements]
Study your financial reports, make sure your secretary knows how to take and keep good minutes, and protect yourself from that call from the AG and all the subsequent damage that could ensue.
Consider creating multiple copies of your nonprofit minutes, or sharing to a remote drive such as the Cloud. Not only will your minute stay secure and up-to-date, but it will be easier to share and edit across your organization.
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