Financial and Legal Matters

There is a strong cross-over between financial matters and legal matters because so much of the law governing nonprofit organizations centers around finances.  Here we put the two categories together and provide a group of resources we think will help nonprofit leaders navigate their way through the requirements and implement best practices.  

Compliance with State and Federal Laws


Nonprofit organizations are required to be registered with the state and have specific reporting requirements.  Both the Ohio Secretary of State and the Ohio Attorney General’s office publish handbooks to step nonprofit leaders through what they need to know. The Attorney General’s Charitable Law Section hosts of a free monthly webinar on nonprofit board governance.  You can register through their website.

Ohio Secretary of State | Starting a Nonprofit in Ohio

This helpful guide from Harbor Compliance outlines the required filings to maintain a nonprofit corporation in Ohio and links to forms and resources to help explain what you need to know to retain your nonprofit status.

Nonprofit Connect is a parthership between the Center for Nonprofit Resources and the Toledo Bar Association. Nonprofit Connect specializes in attorney referrals, information on pro bono services and other ways to connect our attorneys to local nonprofits.


The Michigan Nonprofit Association is a wonderful resource to help new and already-established charitable organizations comply with federal and state laws and regulations. The office of the Michigan Attorney General also offers a wealth of resources on their website.

This helpful guide from Harbor Compliance outlines the required filings to maintain a nonprofit corporation in Michigan and links to forms and resources to help explain what you need to know to retain your nonprofit status.

Of course, the 501(c)(3) status of nonprofits is conferred by the Internal Revenue Service. Their website is fairly easy to navigate. For nonprofit organizations who get involved in issue advocacy, we recommend the articles and booklets published by the Alliance for Justice.

Watch this video featuring Kim Klein about nonprofits, tax policy and her workshop “Show Me the Money: Nonprofits Talking Taxes” presented by CompassPoint and the Building Movement Project.

Budget and Financial Oversight

The budget is one of the most important conversations and decisions the board of directors will have all year.  We like this sample line item budget from NonprofitWorks, but if you need something a little different please feel free to contact Milva Valenzuela Wagner at 419-241-9513.


Many nonprofits are familiar with the grantseeking process, but at times a loan from a financial institution is the wiser step. A loan provides cash for many needs including evening out cash flow, taking advantage of an opportunity to expand, capital purchases, consolidating debt or even starting up your nonprofit business. This article entitled Using Loans: A 101 Guide to Borrowing for Nonprofit Organizations by The Nonprofit Assistance Fund appeared in The Nonprofit Quarterly and offers some sound advice for nonprofit loan seekers.


Organizations with annual revenue above about $300,000 should consider having their books audited by an independent accounting firm.  For smaller organizations, an internal audit is a recommended best practice.  Board members who don’t ordinarily have access to the organization’s checks or financial accounts can use this Internal Audit Instructions and Checklist to perform an internal review. Good advice to nonprofits wondering if it’s time for an audit or an audit is necessary, Nonprofit Audit Guide, from the National Council on Nonprofits.

Financial Policies and Procedures

Every accountant who works with nonprofit organizations can tell at least one agonizing story about a group who loses money because they didn’t have good policies and procedures in place.  Even if your group has never had any trouble, it makes sense to put take steps to prevent something negative from happening in the future.  Here is a sample Internal Controls Checklist from our friends at CompassPoint.  Click here and fill out some information about yourself to download the CompassPoint Fiscal Policies and Procedures Guide and Template.