The entire board of a not-for-profit is legally responsible for the organization's financial success. Not-for-profits have certain basic financial responsibilities:

• protecting the assets
• collecting receivables in a timely manner
• paying debts in a timely manner
• properly recording receipts, disbursements, adjustments
• providing accurate, timely reports

Additionally:

• not-for-profits provide services or products of great importance to the community
• The community dedicates time and money to assist not-for-profits in achieving their purpose
• Board members are custodians of the organization's assets and liabilities
• Board members are custodians of the accumulated efforts of those who preceded them.
• Board members hold in trust the financial resources that enable the not-for-profit to continue to serve the community
• Board members are held accountable for safeguarding the public's trust

Financial responsibility is often delegated to:

1. Board committees
   • Finance (possible audit, budget and personnel)
2. Treasurer
   • the key volunteer financial management role in not-for-profit organizations for overseeing financial operations to make certain that things are done in an appropriate fashion
   • reports on financial activity to the Board (quarterly, semiannually, or annually)
   • frequently is bonded
   • may be involved in early budget preparation
3. Chief executive
   • daily administration, including staffing and operations
   • implementing and coordinating programs
   • maintaining detailed financial records of the organization
   • contractual capability for a wide variety of financial activities (investments, leases, contracts)
   • presenting the budget to the treasurer or to the Board as a whole

In all cases delegates are expected to report back to the Board of Directors. In any of the committee/officer/board functions, care must be taken to refrain from micromanaging the organization. The Board hires management to manage daily operations; the Board's role is to monitor outcomes.

• What committees do we have with financial responsibilities? What are their specific financial responsibilities?
• Do we have the proper staff for our financial activities?
• Does the Board of Directors or its delegated committee meet with the auditor every year?