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Audit & Finance Committee — Charter

Status: Draft, pre-formation. Adopted by board motion at or shortly after incorporation.

Purpose

To provide independent oversight of the Guild's financial integrity: budget, internal controls, audit or financial review, Form 990, banking, investments, and risk management. The committee is the board's principal expert body on money and the systems that protect it.

Authority

  • Recommends to the board: the annual budget, the audit or review engagement (firm and scope), the Form 990 before filing, treasury and investment policy, and material changes to internal controls
  • Reviews and accepts quarterly financials and the bookkeeper's reconciliations
  • Engages directly with the external auditor or reviewer in executive session, without staff present, at least annually
  • Does not approve expenditures, sign contracts, or substitute for the Treasurer's role

Composition

  • 3 to 5 members, including the Treasurer (who is typically — but not required to be — the chair)
  • At least one member with documented financial expertise (CPA, CFO, controller, finance attorney, or comparable)
  • At least one director who is not the Treasurer, to preserve independence
  • The Administrator and Bookkeeper attend as non-voting staff support; the bookkeeper is excused for the executive session with the auditor
  • Term: members 2 years, staggered, renewable

Cadence

  • Monthly in the first six months of the fiscal year while internal controls bed in; quarterly thereafter, plus additional sessions during the audit/review and the 990 cycle
  • Always meets in February (audit kickoff), April (990 draft), September (next-year budget draft), December (close prep + retention review)

Specific responsibilities

Budget and financial planning

  • Develop the annual operating budget with the Treasurer and Administrator; bring to the board in October
  • Review monthly actuals against budget; flag variances above the board-approved threshold
  • Maintain a 12-month rolling cash forecast

Audit / financial review

  • Recommend the engagement (audit, review, or compilation) appropriate to revenue and grantor requirements
  • Review the engagement letter, scope, fees, and independence
  • Receive and evaluate the auditor's report and management letter; recommend remediation to the board
  • Hold the annual executive session with the auditor without staff

Form 990

  • Review the draft Form 990 in April; recommend approval to the board in May before the May 15 filing deadline (compliance calendar)
  • Review the §6033(e) member-notice computation for nondeductible-dues percentage

Internal controls

  • Oversee the reimbursement policy and the 1099 process; review the 5%-or-3-per-quarter reimbursement audit results
  • Review banking signers, dual-control rules, and the QBO access matrix annually
  • Review fraud risk and whistleblower reports annually with the Board Chair

Treasury and investments

  • Recommend treasury policy: cash sweep, FDIC laddering, operating reserve target (typical guidance: 3–6 months of operating expenses)
  • Recommend investment policy if and when the Guild holds investable surplus

Risk and insurance

  • Review D&O, general liability, and cyber coverage annually before renewal
  • Review uninsured risk in the operating plan

Sponsorship and gift acceptance

Decision rights

Decision Authority
Approve a vendor invoice Administrator + Treasurer per signing limits — committee not in the path
Approve the annual budget Recommend; board approves
Engage the auditor Recommend; board approves
Sign the Form 990 Recommend; board approves; Treasurer or Chair signs
Open or close a bank account Recommend; board approves
Set operating reserve target Recommend; board approves

Reporting

  • Written report at every regular board meeting on the consent agenda
  • Annual report to the board within 30 days of fiscal year-end including: actuals vs. budget, audit findings, internal-control changes, key risks, recommendations for the coming year

Deliverables in the first 12 months

  1. Adopted treasury policy with operating-reserve target
  2. Engagement letter signed with auditor or reviewer
  3. First Form 990 reviewed and approved by board
  4. Internal-controls memo with documented dual-control on bank, Stripe, and QBO
  5. Approved budget for Year 2 with the Year-1 actuals as the baseline

Cross-references