BOARD REMUNERATION CONSIDERATIONS FOR NFPs

The Chartered Accountants Australia and New Zealand (CA ANZ) has released a business insight Remunerating Not-for-profit Directors covering key factors to be considered by not-for-profits in determining whether those charged with governance should be remunerated.

The paper includes a checklist highlighting aspects to be considered when contemplating remunerating Boards including an entity's constitution, funding constraints, potential tax implications and other key agreements. A pros vs cons analysis for remunerating Boards is also outlined.

The case for remunerating Boards is centred around the need to attract a skilled and diverse group of individuals and provide recognition for their time and effort.

The argument for not remunerating those charged with governance is focused around the fact that is reduces the potential liability risks associated with being a director and it may also be perceived as being against the spirit of the sector, based on a belief that all of a NFP's available resources should go directly to furthering the purpose of the organisation.

Download the paper from CAANZ website here. Dan Wade is the audit expert at Wrights Chartered Accountants, make an appointment to speak with him here .