Having well-documented policies can assist a nonprofit in having good governance and financial management. Below are some policies that are recommended for nonprofits to follow and have in writing.
Whistleblower protection policy: encourages employees to report financial or other improprieties by establishing procedures to keep the employee’s identity confidential and protects the employee from retaliation.
Document retention/destruction policy: provides guidance on how long documents must be kept by the nonprofit.
Gift acceptance policy: governs the receipt of “non-cash” gifts such as in-kind and unusual gifts (land, vehicles, artwork, stock, etc.) and establishes procedures for reviewing, accepting, and substantiating those contributions.
Conflict of interest policy: is used to help identify, disclose, and handle situations where a financial or other type of conflict may exist.
Investment policy: defines the nonprofit’s objectives for investing, identifies the risk tolerance and who is responsible for the management of the investments.
Joint venture policy: requires a nonprofit to identify, disclose, and properly manage joint ventures (relationships with for-profit businesses).
Capitalization policy: is used to set a threshold, above which qualifying expenditures are recorded as fixed assets, and below which they are charged to expense as incurred.
Disaster recovery plan: documents a process or set of procedures to recover and protect IT infrastructure in the event of a disaster.
There are several other policies nonprofits can have in place, but this is a good starting point. If you have any questions or would like a sample of any of these policies, please contact your Hawkins Ash CPAs representative.