mission Matters 5 Year End Compliance Tips for Nonprofits December 17, 2024 Nonprofits, are you ready to close out the year on a good note? Make sure you address year-end compliance to set the tone for success in 2025. Nonprofits, wondering how you can best prepare for year end and ensure a successful New Year? Here are some compliance tips to wrap up 2024. Review your by-laws- Take a look at your by-laws annually—this helps ensure that your organization is in compliance with its governing documents. Some things to review include:- Should the organization implement term limits?- Should the organization conduct more board meetings in 2025?- Should the size of the Board of Directors change? Increased? Reduced Schedule your annual meeting: The annual meeting serves multiple purposes, including the board of director elections, evaluating and assessing progress towards achieving its mission, reviewing financials, setting the budget, and setting goals for the upcoming year Consider renewing or electing new officers and directors- Are your officers’ or directors’ terms ending? It might be time to appoint new leaders. Some questions to consider:-Has the Organization prioritized diversity when recruiting new members?-Are there specific skills or advisors needed to support the Organization's goals for 2025?-Does the board adequately represent or include voices from the community it servesPrepare and Approve Next Year’s Budget- Part of the annual meeting is preparing the annual budget. The annual budget outlines key priorities and planned policies, turning the Organization’s mission into actionable programs and activities. It’s essential for the board to ensure the budget is updated and adjusted as needed throughout the year. Once finalized, it’s recommended to conduct regular financial oversight which includes routinely monitoring actual results against budgeted goals. If significant variances arise, it’s important to revise the budget. Remember, a budget isn’t set in stone—it should be flexible to adapt to changing circumstances. Prepare for form 990 filing- Form 990 informs the public about crucial aspects of your nonprofit. Most of the pages and tables are available for public inspection, including those describing executive compensation and program expenditures. In addition, Form 990 provides the IRS with information about your nonprofit's activities and financial status to demonstrate that your nonprofit still meets the qualifications for tax exemption. Form 990 is due May 15th every year for calendar organizations.
