Financial Management

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Board Checklist – Legal and Ethical Compliance for Charity Board

This resource, developed by the Charity Law Information Program of the Ontario Community

The broad group of people who are stakeholders of an organization. Extending beyond the people that enter our buildings and use our services, an organization’s community may include cultural groups, sectoral partners, and other groups of people joined together by common identity, geography, and other bonds. Often where we use ‘community’ the word is actually short for multiple communities.

Support Association, provides Executive Directors with a list of the key legal and ethical compliance requirements and duties for non-profit boards. This checklist can also be used and incorporated into risk management

Risk management involves examining a situation and 1) identifying what can go wrong, 2) identifying measures to avoid such problems, and 3) if something does go wrong, identifying steps that can be taken to lessen the negative impact. These measures may include the use of policies, procedures, and protections (such as insurance or education). Risks can be related, for example, to financial loss, workplace safety issues including abuse & physical harm or injury, property damage, or loss of reputation.

policies and procedures as it covers a variety of topic areas. For example, there is a section relating to safeguarding the physical assets and finances of an organization, which includes such questions as ensuring that there are internal controls that are clearly articulated and a process to evaluate such controls (p 3). Another important area includes enforcing an updated conflict of interest policy and adopting a code of ethical behaviour that regulates the actions of all staff

For our purposes, staff refers to agency employees who are neither managers nor executive directors.

members and volunteers (p 6).

Ontario Community Support Association. (2012). Board Checklist. 1-7. Toronto, Canada.


Canadian Charity Legal Checklist

This resource, prepared by the Charity Law Information Program, provides non-profit organizations with a legal checklist relating to financial management

Includes an organization’s Executive Director and managers, but not staff or supervisors. See also definition for “staff.”

and fiscalRelating to finances or financial matters. responsibility, including issuing tax receipts, filing tax returns, and fundraising practices. The resource is divided into a variety of sections that note the requirements and necessary steps required by agencies to ensure they have transparent and structured financial management practices. The resource lists important steps to take to avoid gifts to non-qualified donees (p 7), fundraising costs and practices (pp 8-10) and even ensuring that there are internal financial controlsFinancial controls are policies that, if implemented by the organization's leadership and staff, will ensure that: the organization's staff and assets are safeguarded, the risk of fraud, misuse of funds and errors is minimized, financial transactions are recorded accurately and financial documents are kept safe, financial reports are reliable, the organization complies with laws and regulations, and expenses are managed in line with the organization's budget and financial goals. (pp 14-15). With each section of the document, additional links are provided that outline the guidelines and requirements of the Canada Revenue Agency and other legal documents/publications.

Blumberg, M. (January 30, 2011). Canadian Charity Legal Checklist. 1-16. Toronto, Canada.


The Financial Management Training Center

The Financial Management Training Center provides courses free courses available online,  including on financial planning, forecasting, capital management, and more.

NGO Financial Management Pocket Guide: Your Road to Financial Management Systems

This financial management guide can literally be kept in one’s pocket for quick reference to good financial policies related to (for example)  fixed assets, travel, expenses and payroll. Compiled by Robert Mbugua, Amos Njaramba, Damon Young, and Phangisile Mtshali.

Financial Policy Manual - IWSO

This sample policy manual from Immigrant Women Services Ottawa includes policies and procedures for the organization's accounting, banking and cash management, program and project accounting, annual audits, budgeting and more.

Nonprofit fraud: Focus on segregation of duties and good reporting procedures

This article discusses the importance of good internal control systems in minimizing risks, safeguarding assets, promoting operational efficiency, and enahcning the reliability and completeness of financial reporting. The main features of good internal control systems include authorization of transactions, completeness and accuracy of financial information, they physical safeguarding of assets, and segregation of duties.

By Gary Moulton and Kevin Wilson, Charity Village, September 2000

Registered Charities and the Income tax Act

Canada Revenue Agency Guide on how the Income Tax Act applies to registered charities. Includes definitions, gifts and receipts, how resources can be used.

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