Hi! Nonprofit Boards of Directors are a big deal for new and small nonprofits. The right Board can help you grow and the wrong Board can keep you bogged down in all the stuff there is to do to get a nonprofit off the ground! This webpage has been created to be your one-stop resource for Boards and Board management. So take a look around. (And before you go, download the templates below.)
You are in the right place if:
- You don’t have a clue where to start when building your nonprofit Board of Directors; or
- You know what the importance of a nonprofit Board of Directors but are having trouble recruiting good Board members; or
- You are looking at some ideas when recruiting or holding your next Board meeting.
How do you get Board members and have them contributing to the organization? My answer is to recruit well. Setting expectations for your Board and holding them accountable is imperative. I’ve created a simple Board recruitment package template to help you set the expectations.
Who can benefit from this package?
- You have never recruited anyone before;
- You’re efforts to get a working Board have not gone well; or
- You need some new ideas.
What do you get?
- A Google Doc template ready for your nonprofit’s information that includes the subjects you need to set expectations and help the potential Board member make an informed decision.
Until Next Time,
I get asked this a lot. Here’s what I tell people who ask.
Start from within by putting on your list people you know that might want to make a difference through your cause. Those closest to you may share your passion for your mission. Look at Local Businesses. You need someone with business experience to help get your nonprofit up and running or just keeping it moving. Who better than a business owner to help? Get Referrals. Ask people in your inner circle if they know anyone who meets the skill set or mindset you need. You can also advertise on social media or in the newspaper to broaden your net. I have a free Find a Board Member Resource List for you.
Until Next Time,
annual report: a voluntary document produced by a nonprofit to demonstrate their mission, accomplishments and financial results
articles of incorporation: a document filed with a governmental agency to create a corporation,
set forth the purposes of the corporation and establish the rights and liabilities of shareholders and directors
asset: tangible or intangible property that has exchange value
audit: a systematic financial examination of an organization by an independent body
auditor’s opinion: the auditor’s view of how fairly the financial statements represent the organization’s financial position included in the audit report
balance sheet: a picture of the organization’s resources at a point in time; also referred to as a statement of financial condition
bequest: a gift of personal property or cash through a will or estate plan
by-law: a rule or regulation that provides a framework for operation and management of an organization
capital: financial resources, such as cash, available for use
capital campaign: a fundraising plan to raise money for an endowment or capital improvement
cash flow forecast: a projection of the flow of cash receipts and disbursements
Certified Fund Raising Executive (CFRE): a credential for fundraising professionals administered by CFRE International
challenge grant: a funding agreement which stipulates that the grantee is required to raise gifts from other contributors in order to receive the challenge grant proceeds
charity watchdog: a group such as CharityWatch, Charities Review Council, or Charity Navigator which rates charities based on criteria such as efficiency and governance
collateral: a specific asset pledged by a borrower against the repayment of a loan
community foundation: a grant-making nonprofit organization established to pool the donations of many distinct donors into a collection of permanent, named funds supporting the charitable purposes of the donors in a geographically defined territory
contribution: a voluntary and unrestricted transfer of cash or other assets from one entity to another
corporate foundation: a grant-making nonprofit organization that obtains its funds primarily from one for-profit business
corporate giving program: a grant-making program established within a for-profit business
cost-reimbursement grant: a funding agreement that reimburses specified costs incurred by the nonprofit in the performance of a specific program activity
current asset: tangible and intangible property that is expected to be converted to cash within one year
current liability: a debt or obligation due within one year
declining grant: a multi-year funding agreement that becomes smaller each year
direct charitable expense: cost for activities that primarily benefit the charitable or public sector
direct lobbying: communicating directly with a legislator to influence the passage or rejection of a specific piece of legislation
direct public support: contributions received directly from the general public
donee: a person or organization that receives a gift
donor: a person that contributes something of value to a cause or fund
employee matching grant: a tax-deductible contribution made by an employee that is matched by a similar contribution from her employer
Employer Identification Number (EIN): a nine-digit number used to identify businesses, partnerships, and other entities by the IRS, commonly referred to as a Tax Identification Number
endowment: a financial asset donated to a nonprofit organization in the form of investment funds or other property intended to be kept intact and invested to create a source of income
expenditure responsibility: a set of IRS procedures to be followed by foundations when awarding grants to organizations other than 501(c)3 organizations
family foundation: a grant-making nonprofit organization that obtains its funds primarily
from one family
financial statements: a set of reports usually including a statement of financial position, a statement of activities, a statement of cash flows, and a statement of functional expenses
fiscal sponsor: a tax-exempt organization that legally serves as the recipient of charitable donations for another organization that has not yet been recognized as tax-exempt or does not have the infrastructure to manage funds (the sponsored organization)
fiscal year: a twelve-month period of time used for accounting purposes and calculating financial statements; also called a financial year or budget year
501 (c)(3): an IRS code that establishes a public charity or private foundation as exempt from federal income tax and whose donations are tax-deductible for the donors
fixed asset: an accounting term used for tangible property that the organization does not expect to convert into cash within one year
foundation: a nonprofit organization, supported by a donation or an endowment, that provides funds to unrelated tax-exempt organizations for educational, charitable, social, religious or other activities serving the common good
Generally Accepted Accounting Principles (GAAP): a common set of standards, conventions and rules followed for financial reporting
giving circle: an autonomous group of individuals that donates their money to a pooled fund and decide together where to channel their donations to achieve greater impact
going concern statement: a section in an audit report that indicates whether the audited organization will be financially viable through the next twelve months
grant: a financial award to an organization for a specified purpose
grassroots lobbying: communicating with the general public to influence opinions about a specific piece of legislation or offering a call to action with respect to that piece of legislation
income statement: a report that summarizes an organization’s financial transactions over a specified period of time; also referred to as a statement of activities
independent foundation: a grant-making nonprofit organization that is not closely associated with a for-profit business or family
incubator: a tax exempt organization that has as its mission to act as a fiscal sponsor for organizations that have not yet been recognized as tax-exempt
indirect public support: a contribution from the public received through campaigns conducted by federated fundraising agencies such as the United Way or through a related organization
in-kind contribution: a charitable gift of goods or services
internal controls: policies and procedures that protect the assets of an organization, create reliable financial reporting and promote compliance with laws and regulations
joint-funding: a grant project supported by more than one donor
letter of determination: a document issued by the IRS recognizing an organization’s tax-exempt status and providing its public charity classification
Letter of Inquiry (LOI): a brief request for funding sent as a preliminary step to a prospective donor to determine if there is sufficient interest to warrant submitting a full application, usually containing a statement of need, project narrative and amount requested
letter of support: a personalized communication from a stakeholder to a potential funder expressing their support of a grant application
leverage: a grant-making goal of some foundations pursued by awarding small grants with the purpose of attracting funding from other sources
liability: in accounting, an organization’s legal debts or obligations recorded on the statement of financial position
limited-purpose foundation: a grant-making organization that restricts its funding to one
area of focus
lobbying: an attempt to influence legislation
management letter: a written statement directed by an auditor to a board of directors that notes any material weaknesses or significant deficiencies in the financial statements
matching gift program: a contribution program that matches employees’ or directors’ donations made to qualifying organizations
material weakness: a deficiency in internal controls that may result in a misstatement in an organization’s financial statements that could not be prevented or detected
990 (Form): a public document required by the IRS of certain federally tax-exempt organizations that provides information on mission, programs, financial strength, etc.
990-EZ (Form): a version of Form 990 that is filed by organizations with few gross receipts and
990-N (Form): an electronic version of Form 990 filed by organizations with few gross receipts
990-PF (Form): a version of Form 990 that is required of 501(c)3 private foundations and 4947(a)(1) non-exempt charitable trusts
National Taxonomy of Exempt Entities (NTEE): a hierarchical system of nonprofit classifications
non-cash gift: a contribution of an asset other than money
operating foundation: a nonprofit organization that uses the majority of its resources to provide charitable services or to run charitable programs of its own
operating support grant: a funding agreement to support the general operating expenses of an entire organization such as salaries and rent
overhead: funds spent on the administration of an organization which cannot be attributed to any specific activity but are necessary to function such as rent, utilities, and insurance
payout requirement: the minimum amount that a private foundation is required to distribute for charitable purposes
permanently restricted asset: tangible or intangible property subject to contributor-imposed restrictions on use that can never be removed
private foundation: a nonprofit organization with funds, usually from a single source, and programs managed by its own trustees or directors
Program-Related Investment (PRI): a low- or no-interest loan from a foundation to a nonprofit for a project that supports charitable activities
program-specific audit: a systematic financial examination of an organization by an independent body of an individual program rather than the entity
program support grant: a funding agreement supporting a specific program or project
proposal: a written application submitted to a foundation requesting a grant
public charity: a nonprofit organization that provides direct and specific services to the community and receives the majority of its financial support from the public
Publication 78: a list maintained by the IRS of organizations qualified to receive tax-deductible contributions
qualifying distribution: expenditures of a private foundation, such as a grants, administrative expenses, set asides, or program-related investments, that satisfies its annual payout requirement
restricted funds: income or assets that are designated for a specific purpose or project
restricted grant: contribution designated to a specific purpose or project
ruling year: the date on which the IRS recognized an organization’s tax-exempt status
Sarbanes-Oxley Act: an act passed by Congress in 2002 which imposes two provisions directly on nonprofit organizations, the prohibition of retaliatory action against whistleblowers regulations governing the destruction of important financial documents and provides best practices for other issues
seed money grant: a funding agreement intended to support an organization in its first few years
set-aside: funds designated for a specific project that are treated as a qualifying distribution in the year they are established but not in the year the funds are actually paid
significant deficiency: a weakness in internal controls that is less severe than a material weakness yet merits attention
sponsored organization: an organization that uses a fiscal sponsor to receive its charitable donations
statement of activities: a report that summarizes an organization’s financial transactions over a specified period of time, also referred to as an income statement
statement of cash flows: a report on the flow of cash receipts and disbursements
statement of financial position: a picture of the organization’s resources at a point in time; also referred to as a balance sheet
statement of functional expenses: a report of expenses by their function (such as programs, management, fundraising, etc.) and by the type of expense (such as salaries or rent), in the form
of a matrix)
supporting organization: a public charity that supports other tax-exempt organizations
temporarily-restricted asset: tangible or intangible property subject to contributor-imposed restrictions that expire after a certain date
third party reimbursement: payment for goods or services by a party other than the one receiving the goods or services
third sector: nonprofit segment of the economy
unit of service performance grant: a funding agreement based on a metric such as units of service, number of volunteers, persons served
unrelated business income: income that is not substantially related to furthering the mission
of the organization
unrestricted grant: contribution that can be used for any purpose
unrestricted asset: asset that can be used as the organization sees fit, in accordance with its
mission or purpose
venture philanthropy: application of the concepts and techniques of venture capital finance and business planning, goals such as high-engagement or focus on innovative programs, by a traditional foundation or group of individuals with pooled resources to philanthropy
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