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Good minutes from Board of Director meetings keep the organization on track and moving forward with the mission. But minutes don’t just contain essential information for your organization, but for your future audit as well.

Best Practices for When to Keep Minutes

Your minutes should include the meeting’s agenda, but they should not stop there. The minutes should document any decisions made by the Board of Directors and discussions they had concerning the organization’s day-to-day operation. 

Your Board should keep detailed minutes of each general meeting and the annual meeting, as well as any executive sessions and committee meetings.

Tip: Trying to take the minutes and be part of the Board’s discussion can be difficult for the secretary. Try tape-recording the board meetings and have the recordings transcribed.

Best Practices for Taking Minutes

The format for the meeting minutes is simple:

• Attendance can be as easy as just writing down who’s attending and who’s not or having a sign-in sheet for any visitors.

• Approval of minutes and financial statements from the previous month’s meeting.

• Review of “old business” — i.e., anything discussed in a previous meeting that has not been resolved.

• Discussion of “new business,” including new items that have emerged since the last meeting that need the Board’s attention.

Special Circumstances

If the Board needs to have an executive session, a Board member must motion that they do so. Upon their return, the meeting is usually adjourned.

If the Board has a time-sensitive matter that requires a vote via email, the vote needs to be unanimous and must be read into the minutes at the next meeting.

Old and New Business

During the Board’s discussion of old and new business, two common topics are contracts and work that needs to be done. Any decisions that the Board makes should be documented in the minutes, indicating who made each motion and who seconded it and all members who favored the motion, and all who opposed it. The motion should have the name of any vendor or vendors, what it is for, and the project’s cost. If the actual cost is unknown, the Board can state that the amount shall not exceed a specified amount, and the minutes should include this not exceeding amount.

The Role Minutes Play During Your Audit

When audits are being performed, it is imperative to have documentation of the Board’s decisions. Good minutes will give your auditor a clear understanding of the organization’s day-to-day operation and the financial decisions that were made. The auditor should be able to review the minutes to see all decisions that the Board made on contracts, reserve expenditures, large operating expenditures, and any write-offs of assessments.

What Your Auditor Will Ask For

At the beginning of each audit, the auditor will request a copy of the Board meeting minutes for the year they are auditing, as well as the minutes for the meetings of the subsequent year through the end of the fieldwork. The auditor will also ask for copies of the minutes if they do not receive the signed representation letter within 60 days. This allows the auditor to determine whether the Board has made any decisions following the issuance of the draft audit that is material to the financial statements, which may require disclosure in the audit’s footnotes.

Have questions about audits or assurance services? Our team of experts has the answers and is ready to help. Contact us today to set up a meeting.