Nonprofit Financial Policy Annual Review and Update
Financial policies that are current, comprehensive, and actually followed are the foundation of sound fiscal management. This annual review ensures all key financial policies are reviewed, board-approved, and reflect current best practices and regulatory requirements.
- Industry: Nonprofit
- Frequency: Annually
- Estimated Time: 3-4 hours
- Role: Finance Director / Finance Committee Chair
- Total Items: 28
Core Financial Policies
Review core financial policies.
- Written financial policies adopted by board?
- All financial policies reviewed within last 3 years?
- Conflict of interest policy reviewed and annual disclosures completed?
- Whistleblower protection policy in place as required by Sarbanes-Oxley adoption?
- Document retention and destruction policy in place?
Authorization and Signing Authority
Review authorization limits.
- Check signing authority and dual signature thresholds defined in policy?
- Credit card issuance, limits, and permitted uses defined?
- Contract signing authority defined with board approval thresholds?
- Expense reimbursement policy with receipts and approval requirements defined?
- Petty cash policy with custodian and replenishment procedures?
Investment Policy
Review investment policy.
- Investment policy statement (IPS) adopted by board?
- Asset allocation targets and permitted investment types defined?
- Investment committee or board oversight of investments defined?
- Investment performance reviewed against benchmarks regularly?
- Investment advisor agreement current and fees disclosed?
Reserve and Liquidity Policy
Review reserve policy.
- Operating reserve policy with minimum and target levels defined?
- Current reserve level assessed against policy target?
- Criteria and approval process for using reserves defined?
- Endowment spending policy aligned with UPMIFA and donor intent?
Capitalization and Depreciation
Review capitalization policies.
- Capitalization threshold defined for fixed assets?
- Depreciation schedule and useful lives by asset category defined?
- Fixed asset registry maintained and reconciled to financial statements?
- Grant-funded assets tracked separately per OMB Uniform Guidance?
Policy Communication and Training
Communicate and train on financial policies.
- All staff with financial responsibilities trained on applicable policies?
- Financial policies included in new staff orientation?
- Board members oriented on financial oversight responsibilities?
- Policy exceptions tracked and reported to finance committee?
- Policy compliance monitored through internal controls and audit?
Related Nonprofit Checklists
- Nonprofit Investment and Endowment Management Review
- Nonprofit Accounts Payable and Disbursement Controls
- Nonprofit Payroll Processing and Compliance Review
- Nonprofit Restricted Fund Management and Release
- Nonprofit Strategic Plan Development and Implementation
- Nonprofit Board Member Recruitment and Onboarding Checklist
- Nonprofit Organizational Capacity Building and Strategic Planning
- Nonprofit Executive Director Annual Performance Evaluation
Related Financial Management Checklists
- Nonprofit Grant Tracking and Fund Accounting Ledger Review - FREE Download
- Nonprofit Donor Receipt and Acknowledgment Compliance Audit - FREE Download
- Nonprofit Annual Audit Readiness Review - FREE Download
- Nonprofit Annual Budget Development and Board Oversight - FREE Download
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- Nonprofit Monthly Financial Reporting Package - FREE Download
- Nonprofit Investment and Endowment Management Review - FREE Download
- Nonprofit Accounts Payable and Disbursement Controls - FREE Download
- Nonprofit Payroll Processing and Compliance Review - FREE Download
Why Use This Nonprofit Financial Policy Annual Review and Update?
This nonprofit financial policy annual review and update helps nonprofit teams maintain compliance and operational excellence. Designed for finance director / finance committee chair professionals, this checklist covers 28 critical inspection points across 6 sections. Recommended frequency: annually.
Frequently Asked Questions
What does the Nonprofit Financial Policy Annual Review and Update cover?
This checklist covers 28 inspection items across 6 sections: Core Financial Policies, Authorization and Signing Authority, Investment Policy, Reserve and Liquidity Policy, Capitalization and Depreciation, Policy Communication and Training. It is designed for nonprofit operations and compliance.
How often should this checklist be completed?
This checklist should be completed annually. Each completion takes approximately 3-4 hours.
Who should use this Nonprofit Financial Policy Annual Review and Update?
This checklist is designed for Finance Director / Finance Committee Chair professionals in the nonprofit industry. It can be used for self-assessments, team audits, and regulatory compliance documentation.
Can I download this checklist as a PDF?
Yes, this checklist is available as a free PDF download. You can also use it digitally in the POPProbe mobile app for real-time data capture, photo documentation, and automatic reporting.