Treasurer

A Treasurer is typically charged with overseeing the management and reporting of an organization's finances. Mostly, equally with other officeholder positions, the specific duties of the Treasurer are stated in an organization's bylaws.

Since an system's financial management is direct tied to the Treasurer's responsibilities, the Treasurer'southward execution of her responsibilities will take a strong impact on the public'due south perception, trust, and assurance in the nonprofit equally a whole. With this in mind, organizations should seek Treasurers with desirable skills such as fiscal literacy, attending to item, timeliness in completing tasks, clear and accurate tape keeping, and a willingness to ask questions.

Duties and Responsibilities of the Treasurer

Typically, the Treasurer's duties include the following:

Financial direction and/or oversight. A Treasurer may manage or oversee the management of the financial affairs of the organization, oftentimes including such basic tasks as selecting a bank, reconciling bank statements, and managing cash flow. In some organizations, the Treasurer may too be responsible for investing funds consistent with applicable laws. The Treasurer should be knowledgeable about who has admission to the organization'due south funds and any outstanding bills or debts owed. The Treasurer should create and maintain systems for ensuring the arrangement's ongoing solvency and oversee the evolution of the organization's financial policies. Helpful policies to consider include check signing authority, expense reimbursement, credit card usage, and petty cash policies, if applicative.

Budgets. The Treasurer may be responsible for preparing, or facilitating the preparation of an annual budget, also as regularly monitoring and comparing the actual revenues and expenses incurred against such budget. The development of a upkeep that supports the system's goals and drives decision-making is an important part of an organization'due south success in effectuating its mission. The budget should exist reviewed and approved by the board, however, the Treasurer should exist prepared to explicate and justify the document.

Reports. The Treasurer should have thorough noesis and agreement of the organisation'due south fiscal reports and of import financial ratios. The Treasurer should keep the board apprised of primal financial events, trends, and concerns, and her assessments of the organization's financial wellness. The Treasurer is likewise generally responsible for completing, or ensuring the completion of, required financial reporting forms (including the IRS Course 990) in a timely manner and making these forms available for the board'southward review.

Financial Liaison. A skilled Treasurer should be able to translate financial concepts and information for board members who do not have financial backgrounds or substantial financial experience. The Treasurer should spend time learning the particulars of the organisation's finances and the applicable laws, which may include laws related to earned income, the unrelated business income tax, appropriate expenditures, and prudent investments. The Treasurer can be most effective to the board when she is facilitating and encouraging the lath's strategic thinking virtually the brusque and long term financial vitality of the organization in relation to its advocacy of the arrangement's mission.

California nonprofits must besides be cognizant of California law, which requires nonprofit organizations to accept a Treasurer and/or a Primary Financial Officer (CFO). Organizations may elect to have both a Treasurer and a CFO, with, for case, a board fellow member Treasurer operating supplementary to the staff member CFO. In such case, the board Treasurer'south duties and responsibilities may be more than focused on broader policies and oversight.  Where an organization has a Treasurer but has not designated a CFO in its bylaws, the Treasurer will be considered the CFO past operation of law.

Ultimately, while financial management is the main focus of the Treasurer, the entire board shares the responsibleness of fiscal oversight and accountability.

Tips for Beingness an Effective Treasurer

  • Develop and enforce strong internal controls and financial direction policies
  • Ensure accurate and consummate fiscal reporting and proper maintenance of financial records and information/taxation returns
  • Regularly assess risks and whether and how such risks should be mitigated
  • Go on a calendar of filing requirements and deadlines and take articulate assignments (with backups) to aid ensure they are all met in a timely style
  • Accept the organization's financials audited whenever required or advisable

Traps to Avoid

  • Fail to wisely limit access to and control of the organization's funds
  • Fail to proceed and share with the board accurate and timely financial records
  • Treat the Form 990 merely as a financial report and not a critical marketing communication
  • Give legal or tax communication to donors well-nigh the deductibility of contributions

Resources

  • A sample Treasurer job clarification is available at Boardsource.org.
  • A Treasurer of an all volunteer organization will generally have more responsibilities than her counterpart in an organization with staff. Come across Treasurers of All-Volunteer Organizations: Eight Key Responsibilities (Blue Avocado).
  • Ret Booney's article, "Role of boards disquisitional during crunch," is available here.
  • Minnesota Nonprofit Help Fund commodity, "The Treasurer and Finance Commission – Who to Recruit and How to Apply Them," is available here.
  • Information about generating financial reports is available in the "A Treasurer's Report" extract from John Paul Dalsimer's book, Cocky-Help Accounting: A Guide for the Volunteer Treasurer. (Only the excerpt provided has been reviewed).
  • More information about the CFO role is available in Russell Pomeranz'southward commodity, "Nonprofit CFOs: Visionary Protectors of the Bottom Line, or Myopic Bean Counters?" from The CPA Journal Online.
  • For a brief overview virtually the prudential concerns regarding the Treasurer's involvement on an audit committee based on the California Nonprofit Integrity Human action, please read the previous post on "Nonprofit Integrity Act – Inspect Committee." A guide to the Nonprofit Integrity Act is available here.

See Duties of the President and/or Chair of the Board and Duties of the Secretary of a Nonprofit Corporation.