6 min read
You exit your nonprofit's latest board meeting, having just been elected or appointed treasurer – now what?
Key Takeaways
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If you feel overwhelmed wondering what your role and responsibilities will be and how you will be able to accomplish the task while helping your organization achieve success, you are not alone. Fulfilling the duties of a treasurer for a nonprofit organization is a big job, and doing it well is a considerable challenge.
With the right strategy, skills, and accounting know-how, however, you can be successful in your new role and boost your non-profit organization into a brighter financial future.
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Once you have been elected or appointed treasurer, there are a few housekeeping duties you should take care of straight away.
✔️ Set up a meeting with the outgoing treasurer to transfer files, ask questions and learn what your new duties and responsibilities entail.To ensure success as treasurer, you should never:
Read more: 7 Financial Reports Every Nonprofit Should Monitor
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Depending on the skills of the staff, the treasurer may be responsible for managing the everyday activities of an organization's finances. This includes managing cash flow, paying and recording bills, maintaining a record of debt, selecting a bank and reconciling statements. The treasurer should also have a firm understanding of the organization's bylaws and laws that apply to the organization.
As treasurer, you are responsible for safeguarding your organization's finances. A large portion of this protection should already be built into the organization's bylaws.
If your nonprofit is fairly new, however, you might need to carefully consider these bylaws and potentially institute additional policies and procedures when it comes to handling the organization's finances. Be sure you are working with separation of duties, if possible, a paper trail and dual signatories on checks. We suggest you implement bill.com so you set up rules and workflows so, for example, checks over $5,000 require two (digital) signatures.
As treasurer, it is your responsibility to generate accurate financial reports at period ends and deliver these to the appropriate individuals (usually, executive-level employees and board members).
You will use data from your company's chart of accounts to generate these vital reports; keeping accurate bookkeeping records is essential to generating accurate reports.
Financial reports usually include budgets, the profit and loss statement, balance sheets and a cash flow statement (and/or cash flow projection).
You will likely need to work with board members, the executive director and program directors to create an overall budget (financial projection model) and specific budgets for individual programs. When creating a budget, remember that, as treasurer, you have the best understanding of the types of expenses the organization can afford.
In addition to budgeting, treasurers work with the board of directors to provide advice regarding potential opportunities, risks and tax implications of future financial plans. They might also be consulted regarding grants, proposals, investments and plans regarding unexpected funds and/or cash flow shortages.
Using the principles of GrowthForce's smart back office and system methodology, you can optimize your nonprofit's financial operations, reduce needless expenses and make the most of your fundraising efforts with real-time, actionable financial data. Management accounting allows you to take your role and your non-profit to the next level with management reporting, specifically designed to help directors of non-profit organizations make data-driven decisions to increase funding, encourage growth, broaden the footprint of their outreach, expand their missions and ultimately achieve success.
As an ambassador of the board, it is important that a nonprofit treasurer is able to communicate complex financial concepts by sharing timely and accurate information, such as the statement of financial position, statement of cash flow, budget vs. actual (both overall and by program), profit and loss statements (both overall and by program), and restricted funds budgets vs. actuals.