What Is The Role Of A Treasurer In A Nonprofit?

One of the most common questions I get asked is, “what is the role of the treasurer?”  My response is typically to ask a series of questions.   But bottom line the answer is:

It depends.......

It depends on what the governing document of the nonprofit state.  The bylaws lay out who the officers of the organization will be.  Since each nonprofit has the freedom to establish their bylaws unique to their organization – the role of the treasurer can look different for every organization. 

Doing the work

It’s common to see brand new startups, small nonprofit and clubs define the treasurer as the person doing the work.  They may keep the books, maintain all the financial records and prepare the budget.  Because nonprofit board members are not compensated, this can become challenging for a treasurer to do as the organization grows. 

High-level oversight

With the growth, often comes the hiring of a staff person to perform the financial duties and the treasurer role moves to one of oversight.  At this point, board’s often elect their treasurer as the person on the board who has the most financial strengths and experience. 

The in-between

And there are tons of possibilities for the role in between treasurers doing the work and treasurers with high-level oversight – including the use of finance committees and other combinations of staff and contractors.

What matters most

Since the role of the treasurer can vary, it is critical to know what is documented in the bylaws. If you're new to a board, you should begin by understanding what the bylaws say about that treasurer role. If you've been around for a while and cannot define it with confidence -  go check it out now.  Nonprofit leaders, a bylaw revision could be in your future – make sure reality and the bylaws agree.