Is Your Nonprofit Keeping Annual Minutes?
Best practices for nonprofit board meetings
Your nonprofit organization’s full board should meet periodically, and at least once annually, to conduct the organization’s business, whether in person or by scheduled conference call. If possible, a schedule of board meetings should be fixed at the beginning of the year. Further, while routine decisions may be made by unanimous written consent, major decisions, such as those affecting a nonprofit organization’s policies and practices, should generally be contemplated and decided upon in the context of a board meeting, which may be held telephonically.
Should your nonprofit keep minutes at meetings?
Minutes are defined as the written record of a meeting which typically describes the events of the meeting, as well as a list of attendees, and a description of the issues being discussed by those individuals who are present. The time, location, and a list of those present should be indicated in the minutes. Guests should be specifically indicated to show who does and does not have voting privileges. The content of the minutes does not have to be a transcript of the discussion, but the minutes should contain a summary of the discussion as well as decisions made by a vote of the board members
Without meeting minutes, a nonprofit organization does not have proof about the decisions made in the boardroom. Lack of meeting minutes would allow the IRS to question the organization’s compliance in following the organization’s bylaws, as well as board participation among following nonprofit law and compliance under Internal Revenue Code Section 501.
It is good practice for nonprofits to keep a hard copy of meeting minutes along with an electronic copy. Minutes do not have to be filed with any agency, but copies of the minutes need to be available upon request.
Board of Directors law for California nonprofit corporations
Note the new law adopted as of January 1, 2015, which provides that a California nonprofit corporation may not have non-voting members on the Board of Directors. The new law explicitly states that "[a] person who does not have authority to vote as a member of the governing body of the corporation, is not a director … regardless of title." (California Corporations Code § 5047)
Questions on keeping minutes for your nonprofit?
If you have questions regarding the keeping of meeting minutes and your California nonprofit organization, please call our team of nonprofit attorneys at (858) 755-3000 or email us via the contact button below.