Board members are fiduciaries of an organization and board minutes are considered legal documents that can also serve as a record for future reference. Minutes can provide evidence that a board has exercised care in decision making as well as serve as proof that the board operates in accordance with their own stated requirements (likely in their by-laws), and those of regulatory agencies. Board minutes provide support of decisions made at the board meetings and also tracks the progress of the organization’s mission/goals.
If your organization’s financial statements are audited, board minutes are important to the year-end audit. The auditors will request copies of the meeting minutes for the year under audit, and any subsequent minutes until the audit opinion is issued.
Items the auditors are looking for:
• Approved budgets
• Approval of financial statements
• Contracts entered into
• Large operating expenses approved, including addition of fixed assets
• Significant write-offs
Some organizations tend to keep too much information in their minutes. It is not necessary to document everything verbatim from a meeting into the minutes. The minutes should be more of a summary of the topics addressed and actions taken.
Items to be included in board minutes:
• Type of meeting
• Date, time and location
• List of attendees
• Summaries of discussions of the board
• Board actions taken
• Review of any voting that occurred (motions/seconds and whether passed)
• Elections of officers/directors
• Summary of financial items presented
Items not to include in board minutes:
• Every detail of the discussions
• How each individual voted
• Details on board members’ opinions
• Off the record discussions
If you have any questions, or would like to discuss your specific situation, please contact your trusted TBC advisor.