Does your nonprofit keep excellent board meeting minutes? What about membership meetings? Or meetings of committees? While nonprofits must balance multiple priorities, keeping accurate meeting minutes should be at the top of that list.
What are minutes?
Minutes are the official record of the proceedings of a meeting.
The IRS and most state laws (section 3.151 of the Texas Business Organizations Code) require that corporations, including nonprofit corporations, keep copies of their meeting minutes.
Minutes are a governance measure that provide a glimpse into how the organization is being operated.
What should be nonprofit minutes include?
The minutes should provide a simple, clear explanation of what happened at a meeting. Avoid transcribing every word that is spoken.
Record the following information in minutes:
- The date and time of the meeting
- How the nonprofit notified attendees of the meeting
- The names of those present and absent
- The names of other guests
- If there was quorum
- Any actions or resolutions taken and the votes (for, against, abstention) that action
- A brief summary of any reports or information presented (you can attach reports to the minutes, if needed)
- Any potential or actual conflicts of interest, and how those conflicts were handled
- The name of the person who prepared the minutes
Resolutions and actions can be recorded simply. For example, minutes can state:
Resolutions: The following resolutions were presented to the Board of Directors (or to the Membership):
Resolution 1: Election of Officers. The board (or membership) elected the following person to offices; they will serve as officers until their successors are elected and qualified: Larry F: President; Curly H.: Treasurer; Moe H.: Secretary. Vote: 10 For; 0 Against; 0 Abstained from the vote.
Resolution 2: Adoption of Bylaws. The board (or membership) approved the attached bylaws. Vote: 9 For; 1 Against; 0 Abstained from the vote.
Minutes and Bylaws
The board of directors should understand the the formation documents (i.e., articles of incorporation, certificate of formation, constitution) and the bylaws govern the organization. The board’s actions must be in compliance with the formation documents and bylaws. Board members should know important details like the number needed to establish a quorum, and what financial transactions must be approved by the board.
How are minutes approved?
Meeting minutes should be approved by the appropriate body at its next meeting. So, for a board meeting, the board would approve those minutes at its next meeting. For a membership meeting, the membership body would approve the minutes at its next meeting.
The organization should carefully review the meetings to ensure that it is an accurate record of the previous meeting. Make sure that not too much time passes between meetings so that mistakes can be caught.
Do we have to keep copies of minutes?
Yes, your organization must keep copies of all meeting minutes.
The IRS and most state laws (section 3.151 of the Texas Business Organizations Code) require that corporations, including nonprofit corporations, keep copies of their meeting minutes.
If the IRS or a state agency audits your organization, they may ask to see the minutes. Minutes may be used to determine how decisions are being made in your organization. For example, if your organization approves a compensation package for several staff members, then the minutes should capture how that decision was made. Did the board take steps to avoid a conflict of interest? Did the board look at what other similar organizations pay their staff members? How was executive compensation determined? and more.
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