Annual Checklist for Charity Board of Directors

As a member of a charity's board of directors, you have several important responsibilities to fulfill throughout the year. To ensure that you stay on top of your duties, here is a checklist outlining some of your key responsibilities:

Monitor and maintain a record of the executive director's performance

In the case of your charity having an executive director, it is essential for the board to oversee and monitor the director's performance.

To fulfill this responsibility, you can request the executive director to provide updates on the organization's activities during board meetings. Additionally, you have the option to conduct a performance review to evaluate their effectiveness.
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Make decisions for the charity

As the year progresses, you will be tasked with making various decisions on behalf of the charity organization. Some examples of these decisions include:

• Selecting individuals for the positions of president, vice-president, secretary, and treasurer within the organization.
• Executing the decision to hire the executive director.
• Engaging in purchasing or selling activities on behalf of the organization.
• Reviewing and signing contracts pertaining to the charity's operations.

Maintain accurate records for the charity organization

The charity organization is typically required to maintain its records at its head office. These records encompass various important documents, such as:

• the organization's letters patent and by-laws, as well as any modifications or updates made to these documents over time.
• Minutes of meetings involving the members of the organization.
• Directors register, which keeps track of the individuals serving as directors.
• Members register, containing information about the organization's members.

In addition, the charity's records should include documentation related to its activities. For instance, in the event that the board determines to enter into a contract, it is imperative to maintain records that encompass the contract itself and the meeting minutes that outline the deliberations leading to the decision to execute the contract.
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File returns with the Canada Revenue Agency

It is a requirement for you to annually submit a Registered Charity Information Return (T3010) to the Canada Revenue Agency (CRA).

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Approve the charity’s financial statements

The board has the responsibility to review and authorize the charity organization's financial statements, which are typically presented to the members during the annual general meeting. It is very important to have a detailed understanding of these statements before presenting them.

To aid in understanding financial statements, there are numerous guides available. For instance, CPA Canada provides a free guide on their website that can be beneficial in comprehending financial statements.

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Develop the budget for the charity organization

At the conclusion of each fiscal year, it is necessary for your charity organization to create a budget for the upcoming year. If your organization has an executive director, this responsibility may fall under their duties. However, the board retains the authority to review the budget prepared by the executive director and make any necessary modifications.

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Make sure the board has enough directors and that they’re well-trained

It is essential to ensure that the board comprises an adequate number of directors. Additionally, all directors should possess comprehensive training to effectively carry out their responsibilities.

New directors

When a director does not intend to seek re-election, it is important to initiate the process of identifying a suitable candidate to fill the vacant position once the term concludes. Certain charity organizations follow a designated procedure for selecting new directors, which may involve the involvement of a nominating committee.

The training of new directors is crucial. As an example, they can be requested to review your charity organization's letters patent, by-laws, and policies as part of their orientation process.

Continuous training

While serving on the board, both you and your fellow directors have the opportunity to participate in training programs that are pertinent to your roles and aligned with the activities of your charity organization. Engaging in such training can assist you in enhancing your skills as a director and staying well-informed and up to date with current practices and developments.

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Prepare an annual report

Typically, at the conclusion of each fiscal year, it is customary to prepare an annual report that comprehensively documents the activities and financial performance of the charity organization throughout the previous year. This report also serves as a platform to provides update on the organization's ongoing projects.

The structure and content of annual reports can vary significantly among charitys. However, most reports include essential information such as:

• Details about the individuals employed by the charity.
• Sources of funding for the organization.
• Comprehensive accounts of completed and ongoing activities.

During the annual general meeting, you have the opportunity to deliver this report to the organization's members.

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Convene an annual general meeting

It is necessary for your charity organization to conduct an annual general meeting involving its members. The specific details and requirements regarding the timing and procedure of this meeting are typically outlined in your organization's by-laws. If your by-laws do not cover these specifics, the law usually mandates that members receive a minimum of ten days' notice.

Typically, the focal points of this meeting are your organization's annual report and financial statements from the previous fiscal year. However, the board may also address other pertinent matters deemed important.

The annual general meeting also provides an opportunity for the election or re-election of individuals, such as directors, and allows members to select the auditor for your organization in the coming year.

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Regularly evaluate risks

Conducting risk assessments is a crucial aspect of managing a charity organization. Taking a proactive approach and anticipating potential risks can increase the likelihood of preventing or minimizing their impact on your organization.

To accomplish this, consider the following measures:

1. Conduct a thorough review of your organization's financial statements, receipts, and bank statements to ensure financial stability and order.
2. Establish a risk management policy
3. Review your insurance policies to determine the extent of coverage for events such as property damage or lawsuits targeting the charity or its board.