The organization's practices reflect full implementation of the standard.
Practices are basically sound but there is room for improvement; e.g.,
The organization makes active efforts to diversify or strengthen resources but still relies primarily on one or two major funding sources.
Practice requires significant improvement; e.g.,
Minimal efforts have been made to expand, diversify, or strengthen the organization's resource base.
Implementation of the standard is minimal or there is no evidence of implementation at all; e.g.,
The organization has no “fallback” position and has made little or no effort to protect itself from the consequences of dependence on a single source of revenue.
An organization that invests funds has controls to ensure the proper management of investments, including a committee established by the governing body, as appropriate, that:
follows, and biennially reviews, an investment policy that outlines acceptable levels of risk, criteria for contracting with investment advisors or firms, and protocols for making investment decisions;
oversees and reviews both the investment of funds and the management, purchase, or sale of real estate, securities, and other assets;
ensures practices conform to applicable legal and regulatory requirements; and
reports the status of investments and investment recommendations to the governing body.
Examples: All nonprofit funds are invested and fall under the oversight of the governing body. This includes short-term investments like savings accounts, longer-term investments like stock, bonds, and mutual funds, as well as properties and other assets owned by the organization. The investment policy would, for example, specify how much of the organizations funds will be placed into savings accounts, which provide immediate access to those funds, versus longer term investments.