It’s Time for your Most Important Board Meeting
By Angie Joya
As we stand at the threshold of a new year, it invites us to reflect upon the chapters of the past year. This contemplative moment encourages us, as individuals and within our ministry, to examine the highs and lows, lessons learned, and growth experienced.
Like individuals set personal goals and craft plans for the upcoming year, ministries are not exempt from this thoughtful process.
So, reflecting on the past year, how do you ensure you start 2024 on the right foot?
The significance of board meeting minutes cannot be overstated for nonprofit organizations. The fate of your church or ministry may hinge on the meticulous documentation within these minutes. In the event of an IRS audit, the content—or absence—of your recorded minutes could be the deciding factor in your destiny.
It is imperative for you and your board members to convene regular board meetings, diligently recording minutes, especially addressing the following key topics:
- Salaries and any type of compensation for pastors, staff, and board members.
- Approval of love offerings taken up for the pastor.
- The ordination of any ministers of the church.
- Financial reports of the income and expenses of the church. You must show that the directors have reviewed income reports. And there must be proof of their approval through a voting process as outlined in the church bylaws.
- Approval of policies and procedures. For example, does your church have an accountable reimbursement policy that aligns with IRC section 62?
If this is the first time you have addressed these topics in a board meeting, or if you still need to keep up with these discussions, there's no need to panic! Let's explore a few steps you can take as you move forward.
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Hold a Special Board Meeting
Should your church have overlooked the importance of conducting board meetings and documenting meeting minutes, consider organizing a special meeting to approve past actions retroactively. This proactive step is crucial for ensuring that your church or ministry stays aligned with legal requirements.
Ideally, nonprofits would maintain comprehensive, well-organized records of all meetings and decisions dating back to the inception of their legal operations. However, this ideal scenario may not always align with the reality of organizational practices.
In this special board meeting, the principle of retroactive ratification of prior acts will be implemented. This involves convening the board to approve decisions retrospectively made in the preceding year.
While it's not possible to record meeting minutes for a board meeting that occurred in the past, the option to approve decisions made during that time remains open.
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How to Ratify Prior Acts in a Board Meeting
1. Do your research
When conducting a board meeting to approve prior acts, thorough research on all preceding actions is crucial. Gathering comprehensive information, including dates and the names of board members present during those events, enhances the process.
To prepare for this particular board meeting, consider addressing the following questions:
- When did you meet?
- Where did you meet?
- Who was present?
- What was discussed?
- What was voted on?
- What was decided?
In addition, you should review calendars, previous emails, and notifications to the pastor and the board. This will help you identify acts from previous board meetings that should have been recorded in meeting minutes. Note that if precise dates and times are unknown, you may use a best-faith estimate for such instances.
2. Review the last discussions and decisions
During this board meeting, your board should discuss when past decisions were made. Do more than just research. Make sure you re-discuss the topics. The point is to give all board members present the time needed to recollect their decisions—both how and why they voted the way they did.
3. Take a vote
It may seem like a given, but make sure that during this meeting, you vote to approve those acts retroactively. Remember, you provide a legal precedence to your decisions at a board meeting. There is no better way to do this than through a board of directors vote. Use your church's standard voting procedure. Take note of who was present, what was voted on, and how each person voted.
Schedule Your Special Board Meeting Now
Navigating legal compliance for a church or ministry is a challenging endeavor. Holding and meticulously documenting board meetings are crucial steps in this process. If you have lost track or neglected proper documentation, there's no time to waste. Utilize the ratification of prior acts concept to realign your church or ministry.
If this guidance feels overwhelming, or if you're uncertain about the starting point, feel free to reach out to us at 770-638-3444. Our team of experts is eager to assist you in navigating the necessary steps to set your course right for a successful start to 2024!
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