Nonprofit Accounting Basics

Bylaws

Bylaws are the legally binding rules that outline how the board of a nonprofit will operate. While they are unique to each organization, bylaws generally have a similar structure and use. Because the amendment of this document usually requires a super-majority vote of the board or in a formal membership organization the members may need to approve changes to the bylaws, it is not practical to include all detailed guidelines in this document. A separate set of policies and procedures will clarify further how decisions are made.

All bylaws should address at least the following issues

  • Name and location of organization
  • Statement of purpose
  • Election, roles, and terms of board members and officers
  • Membership issues (categories, responsibilities)
  • Meeting guidelines (frequency, quorum)
  • Board structure (size, standing committees, if any)
  • Compensation and indemnification of board members
  • Role of chief executive
  • Amendment of bylaws
  • Dissolution of the organization
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