Safeguard Your Church with an Annual Board Meeting
By Laura Archambault
Read time: 4.5 minutes
I love roller coasters. Once I was tall enough for the "big" rides, there was no stopping me. Arms high and eyes wide, I delighted in heights, loops, and speed.
As it turns out, I'm not so brave in a car. When I'm in the passenger seat, and a car pulls out suddenly, I squeeze my eyes shut and clutch the door handle. What's the difference? My confidence. A roller-coaster may be wild, but the path is fixed, and I trust the outcome. A car has infinite outcomes, and I can't guarantee a good one.
It's easy to take an "eyes-shut" approach to difficult things, like board meeting minutes. You may not know why it's important or really how to handle it. So you keep operating your church, eyes closed to the "paperwork," and hope whatever you're doing is good enough.
What if I told you that board meeting minutes could be like a roller coaster instead of a car ride? With the right knowledge, you can just about guarantee the right outcome.
If your board hasn't exactly kept board meeting minutes, this blog is for you! Of course, it's best to meet the requirements for board meeting minutes from Day 1. But if you realize your minutes need help, we can help you recover.
Why are board meeting minutes important?
In an ideal world, the fact that your church is operating in unity would be good enough—and your board members could simply make godly decisions with prayer and a handshake agreement. But the IRS expects more to prove the validity of your operations, so documenting the right decisions in your minutes is critical and can save your church if you are under scrutiny.
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You and your board members should hold board meetings, with minutes, for the following 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 and all ministers of the church.
- Financial reports of the income and expenses for 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?
So what if these topics and decisions aren't documented in your board meeting minutes?
Hold a special board meeting
If your church has neglected board meetings and taking board meeting minutes, you can hold a special board meeting to approve prior acts. Holding such a meeting will help your church or ministry remain legally compliant.
This special board meeting will apply the concept of the ratification of prior acts. This is when the board meets for the sole purpose of retroactively approving decisions made in the previous year.
You can't take board meeting minutes for a board meeting that happened in the past. But you can approve the decisions that were made in the past.
How to ratify prior acts in a board meeting
1. Do your research
When holding a board meeting to approve prior acts, it is pertinent to research as much information about all previous actions as possible. The more information you can gather, like the dates and names of board members present at the time, the better.
Answering the following questions will help you prepare for this specific board meeting:
- 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 piece together acts from previous board meetings that weren't recorded in board meeting minutes. Take note that if precise dates and times are unknown, you may use a best faith estimate for such instances.
2. Review 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 the time needed for all board members present to recollect their decisions—both the way they voted and why they voted the way they did.
3. Take a vote
It may seem like a given, but make sure that you take a vote to approve those acts retroactively during this meeting. Remember, you are giving legal precedence to the decisions you made at a board meeting. There is no better way to do this than through a vote of the board of directors. Use the standard voting procedure of your church. Take note of who was present, what was voted on, and how each person voted.
Ministry with eyes wide open
Walking confidently in your legal compliance means having the right documentation, including board meeting minutes. Once you realize that fixing this is doable, don't delay! What could be better than doing ministry with your eyes wide open, enjoying the adventure rather than dreading what could go wrong?
Want to fix more than just your board meeting minutes? Perhaps you're ready to tackle your governing documents, financial records, or annual reporting? StartCHURCH is your one-stop-shop for church compliance resources, so give us a call today at 877-494-4655. Or, pick a time to talk by scheduling a call below. We can't wait to see you leading with eyes wide open.
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