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For nonprofit organizations, the role of the treasurer is a cornerstone of financial integrity and strategic foresight. The treasurer bears the responsibility of ensuring the organization’s fiscal strategy and health while upholding the highest standards of transparency and accountability. From making sure the management team is operating efficiently, to keeping the Board informed of important matters, to navigating the regulatory landscape, treasurers have a multifaceted role that shapes the financial trajectory of nonprofits. A strong partnership between the treasurer, management team, and Board of Directors drives informed decision-making and fosters organizational resilience. Executive Directors often rely heavily on the expertise of the treasurer in setting policy and overseeing results.

Whether you’re a seasoned treasurer seeking to refine your practices or an aspiring leader preparing to step into this role, this article clearly outlines the eight core duties and obligations of the nonprofit treasurer.

Financial oversight

The treasurer shoulders the responsibility of financial oversight, serving as the custodian of fiscal integrity and stewardship. Depending on the size of the organization, they may have a broader spectrum of responsibilities that includes developing and monitoring budgets, preparing financial statements, and managing cash flow to align with objectives and operational needs. That said, in most cases, the treasurer oversees and advises the management team to make sure everything is operating efficiently.

The treasurer relies on the management team to ensure the efficient execution of the audit and may provide oversight over the process. While they can expect that the management team is preparing financial statements in accordance with the relevant accounting standards and regulatory requirements, they may review financial statements before the audit process begins.  Once the audit is complete, the treasurer reports on audit findings to the Board. In some instances, the treasurer oversees investment portfolios, manages regulatory filings to maintain the organization’s charitable status, and fulfills tax obligations. The degree to which a treasurer is directly involved in these activities as opposed to advising and overseeing these activities will depend on the size of the organization and the expertise of the management team.

The treasurer ensures that the board of directors and other relevant stakeholders are provided with transparent and accurate financial reports by the management team. Through diligent oversight and strategic foresight, the treasurer is responsible for safeguarding the organization’s financial health, fostering trust and confidence among donors, members, and the broader community. Typically, the treasurer will set the tone for how this is to be done effectively with the executive team.  

Budgeting

When it comes to budgeting, the management team builds the budget based on programming and operational requirements, while the treasurer reviews it in detail to identify challenges and risks and to validate its reasonableness. They ensure that the team develops comprehensive budgets that are aligned with the organization’s strategic goals and operational needs. Through careful analysis of past financial performance and future projections, the treasurer ensures that budgets are realistic, transparent, and capable of achieving organizational objectives. Throughout the fiscal year, the treasurer monitors performance against budget, identifying areas for concern and recommending adjustments to maintain financial discipline.

Financial reporting 

The treasurer reviews and provides feedback on the organization’s financial statements, ensuring that the Board and stakeholders have a clear snapshot of the overall financial health. Additionally, the treasurer ensures the dissemination of financial reports in compliance with regulatory requirements and internal policies, building trust and confidence among donors, members, and the broader community. The treasurer plays a critical role in facilitating informed decision-making and demonstrating the organization’s commitment to sound financial management and ethical governance.

Internal controls

The treasurer makes sure that the management team has effective internal controls in place to safeguard the organization’s assets, prevent fraud, and ensure compliance with regulatory requirements. They are responsible for ensuring that the appropriate segregation of duties exists. The treasurer also ensures that there are internal checks and balances to reduce risk and improve accountability. Through ongoing monitoring and evaluation at the finance level, the treasurer assesses the effectiveness of internal controls, identifying areas for improvement and advising the management team on corrective measures when needed. By creating a culture of accountability and transparency, the treasurer promotes organizational integrity and safeguards financial sustainability.

Compliance

Nonprofit treasurers bear significant responsibilities concerning compliance with relevant laws, regulations, and internal policies. They must stay abreast of legislative changes and regulatory requirements impacting the organization’s financial operations, and ensure adherence to tax laws, accounting standards, and charitable regulations. The treasurer may not be an expert in all areas of finance, however, they should ensure that the organization has the right team in place or the right external service providers to ensure regulatory compliance. Recognizing that financial stewardship is of utmost importance to donors and funders, the treasurer should ensure organizational compliance with CRA filings, strong internal controls, and clear policies concerning ethical behaviour, particularly relating to finance.  

Audit oversight

In general, it is the management team’s job to manage the audit process. That said, the treasurer reviews proposals from auditors, discusses the audit approach and fees, escalates service issues during the audit to the audit partner, and ensures that management is providing inputs on time and that the audit is completed according to schedule. They identify areas for improvement and provide recommendations to the management team on implementing corrective measures to strengthen internal controls and enhance financial integrity.

Risk management

Treasurers have significant duties when it comes to risk management, safeguarding the organization’s financial integrity and sustainability. They ensure that thorough risk assessments are being conducted, with the goal of identifying potential threats and vulnerabilities that could negatively impact the organization’s operations. The treasurer should oversee the development and implementation of risk management strategies and internal controls to mitigate identified risks effectively. By staying abreast of changes in the regulatory landscape and economic environment, they anticipate and proactively address emerging risks.

Investment management

In some cases, the treasurer must safeguard and optimize the organization’s financial assets. They may be required to develop investment policies aligned with the organization’s objectives and risk tolerance and conduct thorough analyses to select suitable investment vehicles. Additionally, the treasurer may have to monitor investment performance, diversify portfolios to mitigate risks, and revise strategies to maximize returns. With a keen eye on market trends and economic conditions, they make informed decisions to preserve and grow the organization’s financial resources. By monitoring and guiding investment management, the treasurer plays an important role in supporting the organization’s long-term sustainability and mission fulfillment.

Summary

The nonprofit treasurer wears many hats, all critical for the organization’s financial health and sustainability, but the core responsibility is strategic oversight and guidance. In effect, it is their job to make sure that the management team is properly managing finances, internal controls, compliance, audits, and risk. By overseeing these eight core responsibilities, treasurers uphold the highest standards of ethical governance, protect the organization’s assets, and build stakeholder trust. Ultimately, they empower their organizations to create positive social impact in the communities they serve.

Interested in learning more about Enkel and outsourcing back office functions like Bookkeeping, Payroll, Accounts Receivable, Accounts Payable, and Controllership Services? Let’s talk.

At Enkel, we work with Canadian nonprofit organizations to provide reliable, accurate monthly bookkeeping, payroll, accounts payable, and controllership services. If your nonprofit is looking for a bookkeeper to handle the books, get in touch with us today to learn more about our nonprofit accounting services.