When or Do I Get to Throw It Away??? 

Document  Destruction

The Sarbanes-Oxley Act addresses the destruction of business
records and documents and turns intentional document destruction into a process
that must be carefully monitored.   
Nonprofit organizations should have a written, mandatory
document retention and periodic destruction policy. Policies such as this will
eliminate accidental or innocent destruction. In addition, it is important for
administrative personnel to know the length of time records should be retained
to be in compliance.  
The following table provides the minimum requirements.
This information is provided as guidance in determining
your organization’s document retention policy. 
Type  of Document                                                  Minimum  Requirement
Accounts payable ledgers and schedules                        7 years 
Audit  reports                                                                       Permanently 
Bank  Reconciliations                                                         2 years 
Bank  statements                                                                 3 years 
Checks  (for important payments and purchases)        Permanently 
mortgages, notes and leases (expired)                             7 years 
Contracts  (still in effect)                                                     Permanently 
Correspondence   (general)                                                 2 years 
(legal and important matters)                                             Permanently 
(with customers and vendors)                                             2 years 
Deeds,  mortgages, and bills of sale                                    Permanently 
Depreciation  Schedules                                                        Permanently 
Duplicate  deposit slips                                                         2 years 
Employment  applications                                                    3 years 
Expense  Analyses/expense distribution schedules         7 years 
Year End Financial Statements                                            Permanently 
Insurance  Policies (expired)                                                3 years    
Insurance  records, current accident
reports,  claims, policies, etc.                                                Permanently 
Internal audit reports                                                             3 years 
of products, materials, and supplies                                    7 years 
(to customers, from vendors)                                                7 years 
Minute  books, bylaws and charter                                       Permanently 
Patents and related Papers                                                     Permanently 
Payroll  records and summaries                                            7 years 
Personnel files (terminated employees)                              7 years 
Retirement and pension records                                          Permanently 
Tax returns and worksheets                                                  Permanently 
Timesheets                                                                                7 years 
registrations and copyrights                                                 Permanently 
Withholding  tax statements                                                 7 years

 ©2004 National Council of Nonprofit Associations, www.ncna.org 
May be duplicated for non-commercial use, with attribution, by
charitable organizations.

The National Council of Nonprofit Associations (NCNA) is the network of state and
regional nonprofit associations serving over 22,000 members in 46 states and the
District of Columbia. NCNA links local organizations to a national
audience through state associations and helps small and mid-sized nonprofits:
manage and lead more effectively; collaborate and exchange solutions; save money
through group buying opportunities; engage in critical policy issues affecting
the sector; and achieve greater impact in their communities.

By Larry C. Howlett CPA

 The following policies intend to provide
guidance to a charity in accepting gifts in setting standards in evaluating
various kinds of gifts.  The types
of gifts, the limitation/restrictions placed on the gifts and the charity’s
administration of the gifts should be considered in accepting

 The members of the board of directors,
officers and staff should determine how these points apply to the charity, make
changes as needed and operate within these guidelines to best deal with donors
and protect the charity.

 Gifts should only be accepted if the donor
intends to benefit the charity and not seek personal financial gain from the

Gift acceptance policies may be used to
preserve relationships with donors, a valuable asset of a charity. 
Established written policies provide a means for the contact person of
the charity to defect the rejection of an offered gift on the policy, not a
personal choice.  The donor may
observe the charity is professional in its operations and maintains a high level
of integrity.  A gift acceptance
policy provides a means of consistency and communication with

The mission statement should be stated to
remind everyone of the purposes of gifts must conform to the purposes of the

The charity should primarily only accept
unrestricted gifts so the donated items may be used as the organization wishes
for its purposes.  Donor imposed
restrictions should conform to the mission of the charity. 
One of the recognized restrictions may be endowment for board established
purposes.  Restrictions that are
beyond the mission of the donor or for the private benefit of the donor should
be declined.

Donors must retain no control over the
gifts.  Any offers of gifts, where
the donors retain any degree of control should be rejected. 
The organization must accept only gifts when they have free and
unencumbered control to the gifts.

In evaluating if the charity should accept
real estate gifts, it must request the donor secures an environmental clearance
of the property.  The organization
should also consider if it can manage the property or dispose of it properly if
it chooses.