Article XII is about the money, and it begins from a conviction: None of it is ours. Every dollar arrived because somebody believed in the work, which makes stewardship a moral matter before it is an accounting one. So you will find the budget, the books, the reports, and the outside examiners who look over our shoulder on a regular cycle. You will find the plain habits that keep honest people honest. No one carries a transaction end to end, organizational funds never rest in a personal account, and keys are returned the day a role changes. Lasting work is carried by employees and volunteers, not a rotating cast of contractors. Some things were never ours to pledge.
Section 12.1 Fiscal Year
The fiscal year of ReDrafting America shall begin on January 1 and end on December 31. The Board of Directors may change it by Board Resolution when doing so serves the Nonprofit’s best interests and complies with applicable law.
Any change shall be recorded in the official minutes of the Board of Directors and implemented under all applicable legal and reporting requirements. Changing the fiscal year does not alter any federal, state, or local financial-reporting, tax-filing, audit, or regulatory deadline.
Section 12.2 Financial Stewardship
All funds, assets, property, and other financial resources shall serve the Nonprofit’s charitable mission and exempt purposes. Every Official Representative entrusted with those resources shall act prudently, honestly, accountably, and under these Bylaws and applicable law.
The Board of Directors shall protect the Nonprofit’s financial integrity by overseeing mission-aligned spending, timely obligations, and reasonable reserves. Organizational resources shall be administered transparently, efficiently, and consistently with lawful donor restrictions. No asset may provide private benefit or personal enrichment except as these Bylaws and applicable law permit.
Section 12.3 Budget and Oversight
The Board of Directors shall adopt an annual operating budget for each fiscal year. The budget shall reasonably state anticipated revenue, expenditures, programs, strategic priorities, and financial objectives.
The Treasurer shall prepare or supervise the proposed budget after consulting the President, appropriate committees, and Board designees. The Treasurer shall submit it early enough for review, amendment, and adoption before the fiscal year begins.
If no new budget is adopted before the fiscal year begins, the prior budget continues monthly on a proportional basis. No new program, recurring obligation, or compensation increase may begin unless a majority of the Voting Directors approves it. This requirement does not apply to compensation approved by the Compensation and Related-Party Committee or to an increase required by the compensation floor. The Treasurer shall report the budget’s status at every Regular Meeting during the continuation.
The Board of Directors shall monitor financial performance, including material variances, cash flow, reserves, obligations, and significant risks. It may amend the budget by Board Resolution when financial conditions, operations, or strategic priorities require it. Otherwise authorized expenditures may proceed when they protect the Nonprofit’s assets, interests, or charitable mission.
The Board of Directors shall maintain one consolidated operational-authority schedule for each role. It shall state routine authority, spending and contract limits, required reviews, signatures, reporting, and escalation. An unfilled limit grants no authority, and transaction splitting to avoid a limit is prohibited.
The schedule remains subordinate to the governing documents, approved budget, conflict rules, and reserved approvals. It cannot authorize self-approved compensation, related-party transactions, bylaw amendments, mergers, or substantially-all-assets dispositions outside their governing procedures. Existing lawful delegations remain effective within their scope until replaced.
Section 12.4 Financial Records
The Nonprofit shall maintain complete, accurate, and current financial records that fairly reflect its condition and activities. Records shall follow applicable law, generally accepted accounting principles, or another appropriate standard for the Nonprofit’s size, type, or tax-exempt status.
The Treasurer shall oversee the records and may delegate bookkeeping or accounting work to qualified providers. The Treasurer remains accountable to the Board of Directors for proper administration. Administrative, physical, and technological safeguards shall protect record accuracy, confidentiality, integrity, and availability.
Retention, preservation, disposal, and access shall follow the Technology and Records Standards and applicable law. Financial records shall remain protected against unauthorized access, alteration, destruction, loss, or disclosure.
Section 12.5 Financial Reporting
The Treasurer shall ensure that accurate financial reports reach the Board regularly enough for informed oversight. At minimum, the Board of Directors shall receive an annual report describing the Nonprofit’s financial condition for the completed fiscal year. The report should include, as appropriate:
- (a)a Statement of Financial Position
- (b)a Statement of Activities
- (c)a Statement of Cash Flows when appropriate
- (d)a comparison of actual results with the approved budget
- (e)a summary of significant risks, liabilities, reserves, and contingencies
- (f)other information reasonably needed for Board oversight
Financial reports shall fairly present the Nonprofit’s condition under applicable law and appropriate accounting standards. The Board of Directors may require interim reports, special reports, or analyses for governance, major decisions, or legal compliance.
The Treasurer shall give every Director the complete proposed Form 990 and its schedules before filing. Directors must have enough time to review it, and identified corrections must be addressed before the filing deadline. The Secretary shall record the review.
This Form 990 review creates no separate approval or veto and does not extend any filing deadline.
Section 12.6 Independent Financial Review
The Board of Directors shall obtain an independent financial examination whenever law requires it or the Board finds it serves the Nonprofit’s best interests. The examination may be a review, audit, forensic examination, or another appropriate assessment.
Absent an earlier legal requirement, the Board of Directors shall obtain an independent financial review at least every three years. This review supplements any full audit required by law or ordered by the Board of Directors.
A qualified, independent certified public accountant shall conduct each examination. Another independent professional may serve when possessing substantially equivalent qualifications appropriate to the engagement. The examiner shall have no material conflict with the Nonprofit or its organizational relationships.
The Board of Directors shall receive every report, management letter, control recommendation, governance observation, finding, significant deficiency, material weakness, and related written communication. It shall decide whether corrective action is appropriate and oversee timely implementation.
The Board of Directors may replace an examiner whose independence, objectivity, qualifications, competence, or ability has been materially compromised. It may also order additional financial, forensic, compliance, fraud, or cybersecurity examinations when reasonably needed to protect the Nonprofit.
The serving Independent Directors constitute the Audit Committee. A majority of eligible members and at least two participants constitute quorum. Committee action requires at least two affirmative votes.
If the Audit Committee cannot provide the required review, the advisory assignment follows the Chain of Authority, entering at the second level and never moving to a lower level. A failed vote does not transfer final authority. The Board of Directors retains ultimate financial oversight, and no advisory opinion authorizes payment.
Section 12.7 Financial Controls
The Board of Directors shall maintain financial controls suited to the Nonprofit’s size, resources, complexity, and operations. The controls shall protect assets, support accurate reporting, promote legal compliance, and reduce fraud, waste, abuse, and mismanagement. The Board of Directors shall review their effectiveness periodically.
Controls should address the following areas when appropriate. The Board of Directors shall document any material control it determines is unnecessary:
- (a)segregated financial duties
- (b)clearly defined approval authority
- (c)multiple-party approval for significant transactions
- (d)documented approval and payment procedures
- (e)periodic account and record reconciliation
- (f)protection of cash, investments, financial instruments, and other assets
- (g)controls for electronic banking, payment systems, and financial technology
- (h)protection of accounting systems and financial data
- (i)periodic financial-risk and control review
- (j)other safeguards the Board of Directors considers prudent
No Official Representative should control every stage of a significant transaction when reasonable segregation is possible. Staffing limitations require compensating controls that provide equivalent accountability.
The Board of Directors may adopt and revise written financial-control policies consistent with this Section. Those policies should address changing practices, technology, cybersecurity, regulation, and organizational growth.
Section 12.8 Banking Authority
The Board of Directors shall designate the Nonprofit’s financial institutions and establish authority over its accounts and financial relationships. Those relationships include banking, investments, payment platforms, merchant accounts, and credit facilities.
Organizational funds shall remain in accounts held exclusively in the Nonprofit’s name. No person may deposit them into or combine them with a personal account. Selection of financial providers shall follow the conflict-of-interest procedures in these Bylaws.
The Board of Directors shall adopt policies for investing, temporarily managing, and protecting organizational funds. Those policies shall follow fiduciary duties, applicable law, and the Nonprofit’s long-term financial interests. They shall not authorize speculative investing or activity inconsistent with the charitable mission.
The Board of Directors shall authorize the Official Representatives who may execute transactions, payments, transfers, investment actions, or other financial functions. Each authorization shall match the person’s responsibilities and remain subject to financial controls. The Board of Directors shall review accounts, signatories, credentials, investment powers, and other delegated permissions periodically.
When an individual’s financial authority ends or changes, the Nonprofit shall promptly revoke or modify all related access and permissions. All accounts, credentials, tokens, keys, devices, certificates, and access mechanisms remain the Nonprofit’s property. The affected person shall surrender them immediately upon request or upon any termination, suspension, or change of authority.
The Board of Directors may adopt additional banking, treasury, payment, investment, cybersecurity, and authorization policies consistent with this Section. Those policies should address changing technology, operations, fiduciary duties, and risk management.
Section 12.9 Financial Transparency
The Nonprofit shall maintain financial transparency consistent with its mission, applicable law, fiduciary duties, security, and legitimate confidentiality. It shall publish on the Official Website its governing documents, annual financial statements, required financial reports, annual reports, tax filings, and other legally required disclosures. The governing documents published include the Conflict-of-Interest Policy these Bylaws establish. The Secretary publishes the governing documents and annual reports, and the Treasurer publishes the financial statements, financial reports, and tax filings.
The Board of Directors may publish additional financial information when doing so advances accountability, public confidence, donor trust, or education. It should favor disclosure unless law, fiduciary duty, security, privilege, or legitimate confidentiality requires protection.
Published financial information shall be accurate, fair, and reasonably understandable to the public. The Nonprofit shall not knowingly publish materially false, misleading, deceptive, or obscuring financial information.
Protected information includes legally confidential material, contractual confidences, privileged communications, pending litigation, security-sensitive information, confidential donor information, and confidential personnel information. Disclosure is also limited when it would create a substantial risk of harm.
The Board of Directors shall review financial-transparency practices periodically. The review shall assess accountability, public confidence, operational security, and legal compliance.
Section 12.10 Financial Reserves
The Board of Directors may maintain reasonable reserves supporting the Nonprofit’s long-term stability, continuity, and financial resilience. Reserves may address uncertainty, emergencies, obligations, strategic opportunities, capital improvements, and significant mission-related investments.
The Board of Directors shall consider the Nonprofit’s size, complexity, condition, risks, obligations, revenue stability, objectives, and long-term sustainability when setting reserves. Reserves shall advance the mission and shall not unnecessarily restrict timely charitable activity or create private benefit.
The Board of Directors shall periodically review each reserve’s adequacy and purpose. It may increase, reduce, designate, redesignate, or use reserves by Board Resolution. No reserve is required when maintaining it would be impracticable or inconsistent with the Nonprofit’s financial circumstances.
Section 12.11 Charitable Assets
Every asset acquired or held by ReDrafting America remains the Nonprofit’s exclusive property. Assets include revenue, donations, grants, dues, program income, merchandise proceeds, investments, property, intellectual property, digital assets, and surplus funds. Every asset shall serve the charitable mission and exempt purposes.
No organizational asset may be diverted, transferred, pledged, encumbered, wasted, or used primarily for private benefit. Returning a restricted balance as the restricted-gift rules permit does not violate this Section. A lawful expenditure is permitted when these Bylaws authorize it and it directly advances the Nonprofit’s Charitable Purposes.
The Board of Directors shall protect all assets against loss, misuse, waste, fraud, unauthorized access, diversion, and material impairment. This duty covers property, finances, intellectual property, digital assets, confidential information, and every other organizational resource.
All proceeds, returns, royalties, licensing income, and other financial gains remain organizational assets. They shall advance the mission, support long-term sustainability, or further exempt purposes under these Bylaws and applicable law.
Reasonable compensation, authorized expense reimbursement, and other lawful expenditures remain permitted. Borrowing and asset encumbrances remain subject to their separate approval thresholds and protected-asset prohibitions.
Section 12.12 Responsible Contracting
Temporary work may be contracted, but employees or bona fide volunteers shall carry continuing organizational responsibilities. The Nonprofit shall not build permanent departments from contingent labor. Administrative inconvenience or lower cost alone does not justify continuing contractor status.
The Director of Operations and Efficiency shall classify engagements, plan workforce needs, and convert continuing work to employment. The Director shall report classifications and conversions to the Board of Directors.
The Board of Directors shall maintain a Responsible Contracting Policy with duration limits, aggregation rules, classification criteria, approvals, reporting, and employment-conversion procedures. The policy shall also require contracted work to meet labor and compensation standards consistent with the Employment Standards. The Board of Directors may amend the policy without amending these Bylaws, but no amendment may weaken or conflict with this Section.
Section 12.13 Borrowing and Encumbrances
The Nonprofit may borrow, incur debt, or issue evidence of indebtedness only to advance its Charitable Purposes. Unless a higher threshold applies, borrowing requires a Board Resolution approved by a majority of the Voting Directors.
Material Borrowing (borrowing that, together with outstanding indebtedness, would exceed the unrestricted net assets reported in the latest completed fiscal year’s financial statements) and borrowing secured by the Official Website or all or substantially all Nonprofit assets require three-fourths of the Voting Directors.
The following safeguards also apply. Each safeguard is mandatory unless its text provides otherwise:
- (a)Borrowing secured by the Official Website or all or substantially all Nonprofit assets requires the three-fourths threshold, regardless of size.
- (b)No Foundational Work or Flourishing Fund asset may be pledged, mortgaged, assigned as collateral, or otherwise encumbered. Any purported authorization is void.
- (c)Before approving protected borrowing, the Board of Directors shall record its purpose, alternatives, repayment source, default consequences, fiduciary analysis, and consistency with the Nonprofit’s Charitable Purposes.
- (d)The Annual Governance Report shall disclose outstanding debt, protected borrowing approved during the reporting period, and every asset securing that borrowing.
End of Article XII. Return to the TOC