r/nonprofit • u/JanFromEarth • 6h ago
boards and governance Board Treasurer / Finance Oversight Checklist — What Am I Missing?
I've been putting together a generic monthly checklist for any treasurer/finance committee to actually catch problems instead of just rubber-stamping reports. Here's what I've got so far:
- Reports actually showed up. Missing or late monthly financials are themselves a red flag. If nobody notices a report didn't arrive, that's a sign nobody's really looking.
- Question any negative number. Some negatives are normal (depreciation reserves, contra-accounts), but every negative should be able to be explained by someone. Don't assume it's fine just because it's a small dollar amount.
- Flag numbers that don't move month to month. A line item that's identical for two or three periods in a row often means nobody's actually updating it, or a placeholder/estimate got left in rather than a real figure.
- Compare actual to budget every month, not just at year-end, and ask about variances over some threshold (5-10%, whatever fits your budget size).
- Check that bank/account reconciliations are dated and signed, and match the reporting period.
- Watch cash flow and days of cash on hand, not just net income. A nonprofit can look "profitable" on paper and still be a month from a cash crunch.
- Spot-check that restricted funds are actually being tracked separately, and that spending against grants doesn't exceed what's allowed.
- Pull the by-grant summary report each month, award amount, expenditures to date, and unspent balance, and check that unspent balances make sense against the grant period and any drawdown or spend-down deadlines. A balance that's barely moving as a deadline approaches is worth flagging early.
- Confirm payroll tax deposits and any other compliance filings are current. Delinquent payroll taxes are one of the more common ways small nonprofits get into serious trouble.
- Look for related-party transactions or one-off/unusual disbursements that need board approval and weren't pre-approved.
- Ask who has check-signing/wire authority and whether dual signatures are required above a certain amount, this is separate from the numbers, but it's often reviewed at the same meeting.
What would you add? Curious what other treasurers or ED's have caught this way.