Policies & Guidance

Financial Controls

PURPOSE

The purpose of financial management in the operations of LWV Minnesota (LWVMN) is to fulfill the organization’s mission in the most effective and efficient manner, protect the assets of the organization and to remain accountable to stakeholders, including members, partners, funders, employees, and the community.

The Financial Controls Policy provides a framework for our organization’s financial decision making in executing this purpose and in order to accomplish this purpose, LWVMN commits to:

  • Ensuring that financial records are accurate and complete;

  • Complying with all federal, state and local standards and/or requirements;

  • Complying with the Financial Accounting Standards Board (FASB) and Generally Accepted Auditing Procedures (GAAP);

  • Conducting periodic outside financial audit or review;

  • Ensuring separation of financial duties to serve as a checks and balances system of internal controls to protect from theft, fraud or inaccurate reporting;

  • Protecting whistleblowers who report financial misconduct from negative repercussions;

  • Providing a training resource for staff relative to financial management process and responsibilities.

AUTHORITY

The Board of Directors is ultimately responsible for the organization’s financial management including the activities of the Executive Director, staff, consultants and volunteers. The Executive Director is responsible for the day-to-day financial management of the organization.

  • The Board authorizes the Executive Director to hire and supervise staff, as well as any independent consultants or contractors; pay bills, receive funds, and maintain bank accounts in accordance with established policy.

  • The Board authorizes the Executive Director to sign checks up to $7,500 (excluding payroll). Checks for amounts greater than $7,500 shall require the prior approval of the Treasurer or Board President or Finance Committee Chair.

  • The Board authorizes the Executive Director to enter into contracts for activities that have been approved by the Board as a part of budgets or plans. The Board of Directors must authorize any contracts outside of these parameters and all contracts with a financial value greater than $15,000 and/or a term of more than two years.

  • The Board authorizes the Executive Director to manage expenses within the parameters of the overall approved budget, reporting to the Finance Committee on variances and the reason for these variances.

  • The Board of Directors must approve any use of any board-designated cash reserve fund and/or delegate authority to distribute funds to the Executive Director.

FINANCIAL AUDIT AND REVIEW

In order to fulfill its fiduciary duty and provide for appropriate financial oversight, the Board has exclusive authority to request audit of the organization’s financial records, systems, processes and published statements. The Board will:

  • At least every five years, or more frequently as may be deemed necessary, direct the Finance Committee to call for proposals from local Certified Public Accounting (CPA) firms for professional services, including audit services.

  • Conduct a certified audit or review from a Certified Public Accounting (CPA) firm every five years, or more frequently as deemed necessary.

  • Direct the Finance Committee to oversee a comprehensive financial review of the organization’s financial practices, records and statements in the years in which a full audit will not occur.

  • Request a full audit at the conclusion of any fiscal year in which the Executive Director transitioned from one person to a successor. These requirements supersede the audit versus review timing requirements described earlier in this section.

The Board may request with or without cause a full audit of the organization’s financial practices, procedures, records, systems, and published statements any time it deems necessary.

BUDGET

In order to ensure that planned activities minimize the risk of financial jeopardy and are consistent with Board approved priorities, long-range organization goals, and specific objectives, the Board will present a bi-annual budget for membership approval at the Convention and an interim revision if necessary at the Council meeting of the membership.

ASSET PROTECTION

In order to ensure that the assets of LWVMN are adequately protected and maintained, the Board will review and approve at least every two years all insurance policies obtained, and asset protection plans developed by the Executive Director.

FINANCIAL TRANSACTIONS WITH INSIDERS 

No advances of funds to employees, officers, or directors are authorized. Direct and necessary expenses including travel for meetings and other activities related to carrying out responsibilities shall be reimbursed.

In no case shall LWVMN borrow funds from any employee, officer, or director of the organization without specific authorization from the Board of Directors.

RELATIONSHIP TO OTHER POLICIES

LWVMN maintains the following Board approved financial policies and guidance: 

  • Fixed Asset Capitalization Policy

  • Gift Acceptance Policy

  • Investment Policy

  • Operating Reserve Policy

  • Accounting for Funds with Donor Restricted Guidance

Any identified contradictions between these financial policies and guidances must be brought to the Finance Committee’s attention for review.

The Finance Committee will recommend any necessary policy changes/corrections or additions to the Board of Directors. Only the Board of Directors can change, rescind or adopt an organizational policy.

REVIEW OF POLICY

This Policy will be reviewed every other year, at minimum, by the Finance Committee, or sooner if warranted by internal or external events or changes.

Changes to the Policy will be recommended by the Finance Committee to the Board of Directors.

 

Policy approved/adopted: December 16, 2019