California Non Profit Compliance Guide

Summary

Non-profit organizations in California must file Form RRF-1 annually if gross receipts exceed $50,000. Profits must be reinvested into the organization’s mission. Follow GAAP for financial records, and conduct audits if revenue exceeds $2 million. Salaries should be reasonable, board-approved, and documented. Use specialized software like QuickBooks for Nonprofits for easy tracking. Hiring an accountant or lawyer can ensure compliance and proper financial management.

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when I start to make profit should I take all the profit or half or what?

It's great that you're considering the implications of making a profit. To provide better guidance, could you clarify if you are asking from a business perspective or for a charitable organization?

for non for profit

For a non-profit organization, any profits (net earnings) must be reinvested back into the organization's mission and activities, not distributed to members or directors. Here are key points:
- **Profit Use:** Must be used for the organization's charitable purposes.
- **No Personal Gain:** Profits cannot benefit private individuals.
Would you like to know more about compliance or financial management for non-profits in California?

yes

Great! Here are some key compliance and financial management points for non-profits in California:
- **Annual Filings:** Must file Form RRF-* and Form * with the Attorney General's Registry of Charitable Trusts.
- **Accounting Standards:** Follow Generally Accepted Accounting Principles (GAAP).
- **Audits:** Required if gross revenue exceeds $* million.
Would you like information on record-keeping or specific state regulations?

yes

~California Non-Profit Compliance Record-Keeping and State Regulations Information
- **Record-Keeping:** Maintain accurate financial records, minutes of board meetings, and documentation of charitable activities.
- **State Regulations:** Comply with the California Nonprofit Public Benefit Corporation Law.
Would you like more detailed information on either of these topics?

How i DO all this step by step

Sure, let’s break it down step-by-step for you:

Filing Requirements:
- **Annual Filings:**
- **Form RRF-*:** File annually with the Attorney General's Registry of Charitable Trusts.
- **Form *:** File annually with the IRS.

Accounting Standards:
- **GAAP:** Follow Generally Accepted Accounting Principles for all financial records.

Audits:
- **Threshold:** If gross revenue exceeds $* million, conduct an annual financial audit.

Record-Keeping:
- **Financial Records:** Maintain accurate financial records.
- **Board Meetings:** Keep minutes of all board meetings.
- **Charitable Activities:** Document all charitable activities.

State Regulations:
- **Compliance:** Adhere to the California Nonprofit Public Benefit Corporation Law.
Would you like a specific guide on how to maintain these records, or how to prepare for an audit?

yes

To maintain records and prepare for an audit for your non-profit organization in California, here’s a step-by-step guide:

Maintaining Records:
- **Financial Records:** Use accounting software or ledgers to track all income and expenses.
- **Board Meetings:** Keep detailed minutes of all board meetings, including decisions made and actions taken.
- **Charitable Activities:** Document all activities, including descriptions, dates, and expenditures.

Preparing for an Audit:
- **Pre-Audit Preparation:** Gather all financial records, meeting minutes, and documentation of activities.
- **Engage an Auditor:** Hire a certified public accountant (CPA) with experience in non-profits.
- **Audit Process:** Cooperate with the auditor, providing all requested documentation.
Would you like more details on any of these steps?

I want everything in steps with numbers

Certainly! Here is the information broken down step-by-step with numbers:

Maintaining Records:
*. **Financial Records:**
- Use accounting software or ledgers to track all income and expenses.
- Ensure entries are accurate and up-to-date.
*. **Board Meetings:**
- Keep detailed minutes of all board meetings.
- Include decisions made and actions taken.
*. **Charitable Activities:**
- Document all activities.
- Include descriptions, dates, and expenditures.

Preparing for an Audit:
*. **Pre-Audit Preparation:**
- Gather all financial records.
- Collect minutes of board meetings.
- Compile documentation of charitable activities.
*. **Engage an Auditor:**
- Hire a certified public accountant (CPA) with non-profit experience.
*. **Audit Process:**
- Cooperate with the auditor.
- Provide all requested documentation.
Would you like more details on any specific steps?

Explain each step further

Sure, let's dive deeper into each step:

Maintaining Records:
*. **Financial Records:**
- **Use Accounting Software or Ledgers:** Choose reliable accounting software tailored for non-profits (e.g., QuickBooks for Nonprofits) or maintain a detailed ledger.
- **Ensure Entries are Accurate and Up-to-Date:** Regularly record all transactions, categorize them properly, and reconcile accounts monthly to ensure accuracy.
*. **Board Meetings:**
- **Keep Detailed Minutes:** During each board meeting, appoint a secretary to document the proceedings. Include details such as attendance, agenda items, discussions, decisions made, and actions assigned.
- **Include Decisions Made and Actions Taken:** Clearly note any resolutions passed and assign responsibilities with deadlines.
*. **Charitable Activities:**
- **Document All Activities:** For each event or program, record the event's name, purpose, date, and location.
- **Include Descriptions, Dates, and Expenditures:** Provide a narrative of the activity, list participants, and document all related costs, including receipts and invoices.

Preparing for an Audit:
*. **Pre-Audit Preparation:**
- **Gather All Financial Records:** Collect all financial statements, bank reconciliations, receipts, and

How much money should I take for myselef as a salary?

For non-profit organizations, salaries must be reasonable and reflect fair market value for the work performed. Some guidelines include:
- **IRS Guidelines:** Compensation must be reasonable and necessary.
- **Board Approval:** Salaries should be approved by the board of directors.
- **Comparable Salaries:** Review salaries for similar roles in similar organizations.
Would you like to know more about determining a reasonable salary or guidelines for board approval?

How I mointor my salaries and my employees and how much should I take or percentage and what I suppose to with the rest of the money?

For a non-profit organization, monitoring salaries and managing finances involves several steps:

Monitoring Salaries and Employees:
*. **Set Clear Salary Guidelines:**
- Develop salary scales based on job roles and industry standards.
- Ensure all salaries are approved by the board of directors.
*. **Regular Reviews:**
- Conduct annual performance and salary reviews for all employees.
- Adjust salaries based on performance and market trends.
*. **Documentation:**
- Maintain detailed records of all salary decisions and employee performance evaluations.

Determining Your Salary:
*. **Reasonableness:**
- Ensure your salary is reasonable and reflects fair market value.
- Use industry benchmarks to determine a competitive yet fair salary.
*. **Board Approval:**
- Obtain approval from the board of directors for your salary.
- Document the decision in board meeting minutes.

Managing the Remaining Funds:
*. **Reinvestment:**
- Reinvest surplus funds into the organization's programs and activities.
- Ensure funds are used for the organization’s charitable missions and goals.
*. **Financial Planning:**
- Develop a financial plan to allocate funds effectively.
- Maintain an emergency reserve fund for unforeseen expenses.
Would you like more details on developing salary guidelines

Yes and I want a place that is so easy to put all this information in it and keep tracking

To keep all this information organized and easily trackable, consider using specialized software for non-profit management. Here are some options that might be helpful:

~Non-Profit Management Software Options~
*. **QuickBooks for Nonprofits**
- **Features:** Accounting, payroll, expense tracking, and donor management.
- **Website:** [QuickBooks Nonprofit](https://quickbooks.intuit.com/nonprofit/)
*. **Bloomerang**
- **Features:** Donor management, email marketing, and reporting.
- **Website:** [Bloomerang](https://bloomerang.co/)
*. **NeonCRM**
- **Features:** Fundraising, event management, and membership tracking.
- **Website:** [NeonCRM](https://www.neoncrm.com/)
*. **Little Green Light**
- **Features:** Donor management, event planning, and reporting.
- **Website:** [Little Green Light](https://www.littlegreenlight.com/)
Would you like more information on any specific software or help with another aspect of managing your non-profit?

which is top choice and so easy to use

For ease of use and comprehensive features, **QuickBooks for Nonprofits** is often considered a top choice. It offers:
- **Accounting:** Streamlined for non-profits.
- **Payroll:** Integrated payroll processing.
- **Expense Tracking:** Detailed expense management.
- **Donor Management:** Efficient tracking and communication with donors.
Would you like more information on setting it up or comparing it with another option?

do I need to hire accountant or lawyer

Whether you need to hire an accountant or a lawyer depends on your specific needs:
- **Accountant:**
- Helps with financial management, bookkeeping, tax filings, and audits.
- Ensures compliance with accounting standards like GAAP.
- **Lawyer:**
- Provides legal advice on compliance with state and federal laws.
- Assists with forming your non-profit, drafting bylaws, and addressing legal issues.
Would you like more detailed information on the roles of each, or help with finding professionals in your area?

California Non Profit Compliance Guide

Summary

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