Inspection of Financial Records

[Guest Shannon]

I am reviewing bylaws for someone who has requested to inspect the treasurer's records (she is a member of the non-profit). The President of the non-profit has denied the request to inspect the books citing the bylaws.

The bylaws say:

"Section 6, Treasurer: Shall be directly responsible to the President for the operation and management of the busienss office. The Treasurer will return a Treasurer's Report to the membership following the close of the Club year and at such other times as the President or Board of Directors may require. A Treasurer's Report shall be returned at each Club meeting if requested or required by the Board of Dorectors. The books of the Treasurer shall be open to inspection at all times.

Section 7, Inspection of Records: The Board of Directors reserves the right to authorize an attorney or certified public accountant to inspect all records of the corporation maintained by the Seretary and Treasuer for any proper purpose at any reasonable time."

My thoughts are that proper procedure are that the books are open to inspection at all times by the membership but only the Board can authorize an attorney or CPA to do an inspection/audit. Any thoughts on what is proper? I've never been involved with a non-profit that does not allow the membership to review the books at any time.

[Tim Wynn]

I am reviewing bylaws for someone who has requested to inspect the treasurer's records (she is a member of the non-profit). The President of the non-profit has denied the request to inspect the books citing the bylaws.

The bylaws say:

"Section 6, Treasurer: Shall be directly responsible to the President for the operation and management of the busienss office. The Treasurer will return a Treasurer's Report to the membership following the close of the Club year and at such other times as the President or Board of Directors may require. A Treasurer's Report shall be returned at each Club meeting if requested or required by the Board of Dorectors. The books of the Treasurer shall be open to inspection at all times.

Section 7, Inspection of Records: The Board of Directors reserves the right to authorize an attorney or certified public accountant to inspect all records of the corporation maintained by the Seretary and Treasuer for any proper purpose at any reasonable time."

My thoughts are that proper procedure are that the books are open to inspection at all times by the membership but only the Board can authorize an attorney or CPA to do an inspection/audit. Any thoughts on what is proper? I've never been involved with a non-profit that does not allow the membership to review the books at any time.

I don't see anything in your post that indicates that the president can prevent a member from inspecting the records. Perhaps you should ask the president for a more specific citation than "the bylaws."

[Guest Shannon]

The President is citing Section 7 and is saying that means that only an attorney or CPA can inspect. I disagree with that interpretation and therefore am looking to see if there are any other resources on what most non-profits do as the President will only allow this to go forward by being put on the Agenda and the Board can make a determination if any member is allowed to inspect.

[Guest Edgar]

I disagree with that interpretation . . .

Make a point of order at the next meeting (of the general membership) to the effect that the president has improperly restricted your right, per Section 6, to examine the books. The chair, citing Section 7, will presumably rule that your point of order is "not well taken". Appeal his ruling (it requires a second). Following debate, the assembly will determine what the bylaws mean. Then amend the bylaws to remove the ambiguity (which, I think, exists).

[Dan Honemann]

Make a point of order at the next meeting (of the general membership) to the effect that the president has improperly restricted your right, per Section 6, to examine the books. The chair, citing Section 7, will presumably rule that your point of order is "not well taken". Appeal his ruling (it requires a second). Following debate, the assembly will determine what the bylaws mean. Then amend the bylaws to remove the ambiguity (which, I think, exists).

A point of order at the next meeting is not a proper parliamentary tool to use in a situation such as this. Points of order must be raised promptly at the time the breach occurs (none of the exceptions referred to on page 251 being applicable).

[Guest Edgar]

A point of order at the next meeting is not a proper parliamentary tool to use in a situation such as this. Points of order must be raised promptly at the time the breach occurs (none of the exceptions referred to on page 251 being applicable).

Thanks. I had my doubts as I was replying but I wasn't sure how to object to an infraction of the rules when the alleged infraction (denying members' access to the books) occurs outside of the context of a meeting. Would a motion ordering the appropriate officer to make the documents available be the way to go?

Any help would be appreciated.

[Dan Honemann]

Thanks. I had my doubts as I was replying but I wasn't sure how to object to an infraction of the rules when the alleged infraction (denying members' access to the books) occurs outside of the context of a meeting. Would a motion ordering the appropriate officer to make the documents available be the way to go?

Any help would be appreciated.

Yes, a motion ordering that the documents be made available would appear to be appropriate. If the chair rules that such a motion is not in order (based upon his interpretation of the bylaws), then an appeal can be taken from his ruling, and the assembly will decide what the bylaws say.