How Must Nonprofits Store Corporate Records Under ONCA?

The Ontario Not-for-Profit Corporations Act (ONCA) has brought several updates that are crucial for the smooth functioning of nonprofits in Ontario. One significant change under ONCA is the allowance for storing corporate records on the cloud. This development addresses previous ambiguities regarding the storage of important documents and provides clear guidelines for modern record-keeping practices.

Traditional Record-Keeping Requirements

Historically, nonprofits were required to maintain certain corporate records at their physical office. These records included:

  • Financial statements
  • Minutes of meetings
  • Membership lists
  • Other important documents


The requirement for physical storage was clear but did not explicitly address the possibility of digital or cloud storage.


The New ONCA Provision

ONCA has now explicitly allowed nonprofits to store corporate records electronically, even on servers located outside Ontario. The key conditions for this new provision are:

  • The records must be accessible from the nonprofit's registered address in Ontario or another location chosen by the Board of Directors.
  • The electronic records should be in a format that is easily retrievable and readable.


Why This Change Matters

Modernization of Record-Keeping

The permission to store records on the cloud allows nonprofits to adopt modern technology for their operations. This shift offers several advantages:

  1. Efficiency: Cloud storage can streamline the process of organizing, retrieving, and updating records.
  2. Accessibility: Authorized members can access necessary documents from anywhere, facilitating remote work and collaboration.
  3. Cost-Effectiveness: Digital storage can reduce the costs associated with physical storage spaces and paper usage.

Security and Compliance

Cloud storage often comes with robust security measures, such as encryption and regular backups, ensuring that sensitive information is protected. Additionally, maintaining compliance with ONCA’s provisions ensures that nonprofits operate within the legal framework, avoiding potential penalties.

Steps to Transition to Cloud Storage

  1. Assess Current Record-Keeping Practices: Review how records are currently stored and identify areas for improvement.
  2. Choose a Reliable Cloud Service Provider: Ensure the provider offers strong security features and complies with data protection regulations.
  3. Develop an Access Policy: Decide who in the organization will have access to the electronic records and set up appropriate permissions.
  4. Train Staff and Volunteers: Provide training on how to use the new system and the importance of data security.


Maintaining Compliance with ONCA

Even with the flexibility of cloud storage, nonprofits must ensure that:

  • Records are updated regularly.
  • Backup copies are maintained.
  • The digital files are accessible from the designated location in Ontario.

The ONCA’s allowance for cloud storage of corporate records marks a significant step forward for nonprofits in Ontario. By embracing this change, organizations can enhance their operational efficiency, ensure better security of sensitive information, and comply with modern legal requirements. This move towards modernization is a clear green light for nonprofits to streamline their record-keeping practices and focus more on their core mission and objectives.

Nonprofits should consider this change as an opportunity to review and update their record-keeping strategies. By leveraging cloud technology, they can improve their administrative processes and better serve their communities. The ONCA’s provision not only clarifies legal requirements but also supports the ongoing digital transformation of the nonprofit sector in Ontario.

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