A common question on the minds of many volunteer treasurers is just how long they should keep certain records. Many files and documents have become digitised over the years, which makes storage and retrieval easier to accomplish, but even cloud storage is not infinite. That’s one of the reasons why you periodically should go through both your virtual paperwork, and hard copies, and remove unnecessary documentation.

Why Keep Records?

If your nonprofit is an ACNC charity, proper recordkeeping is necessary to show good governance, and a registration requirement. Even if your NFP isn’t registered, other government and regulatory bodies typically require your NFP to keep specific records. These include the need to keep records regarding your business in order to manage and report your obligations to the ATO, and to show that your board is making sound financial decisions, following its bylaws and acting in good faith towards its members.

Keep in mind that record retention practices should apply equally, regardless of whether your records are stored in the cloud, in a physical filing cabinet or just a hard drive on your computer, and that you should take precautions to back up your information and protect it from loss in case of theft, fire or another unexpected event.

Financial Records

Your nonprofit’s financial records include your ledgers and bank statements and transactional records that document your NFP’s payments, such as checks and your income and other financial activities. Details of contracts, deeds, receipts from sales of tangible and intangible property, stock records, payments to staff and other employees as well as independent contractors including your superannuation and withholding payments are additional types of financial records that you should keep.

Asset registers, tax payments and filings, communications involving the nonprofit’s finances, including emails, are also financial records that you should keep. Audit reports, year-end statements, annual budgets and other reports that detail the financial condition of your nonprofit at given points in time should also be retained.

Operational Records

Your nonprofit’s governing documents, such as your constitution, bylaws, articles of incorporation and similar records that detail the founding of your organisation, its purpose, and rules that it will follow, should be kept indefinitely. Minutes of board meetings, amendments and resolutions, memoranda, donor reports and annual reports, strategic plans and your formal policies and procedures are all records that detail how your NFP operates and should be kept.

Records that advertise or promote your nonprofit and its work should also be kept such as press releases, promotional materials related to your NFP, and documentation or multimedia recordings that demonstrate that you are acting to fulfil your purpose.

Programs and Services

Records that detail and document the type of work that your nonprofit does to advance its mission should also be kept. This includes records that show program planning and evaluation, transactions related to the services that you perform for beneficiaries, including costs and expenses to operate specific programs and provide specific services, how many people you have served and what your programs have accomplished.

Contributions and Fundraising

Information about your donors, specific donations and other gifts and contributions that you have received from both individuals and businesses. You should also keep all records regarding the grants you have applied for and received, also with documentation that shows how these monies are spent. Keeping a record of this type of information not only helps you meet legal requirements but can also be used to improve your fundraising campaigns and results!

Learn More About Recordkeeping

Check out the ACNC’s Recordkeeping Checklist to learn more about record-keeping best practices for registered charities that all nonprofits should find useful.