Adopting a written document retention policy ensures that staff and volunteers follow consistent guidance about document destruction and that document destruction/deletion practices become a regular business practice of the nonprofit.
Developing a document retention policy may seem overwhelming at first, but think of it as simply a record of what types of documents the nonprofit must retain and for how long. The policy should specify that the nonprofit will also adhere to a regular business practice of document destruction according to the schedule referred to in the policy or adopted by the nonprofit from time to time.
Document retention policies are one of several good governance policies that the IRS highlights on the IRS Form 990 by asking whether the filing nonprofit has adopted a written record retention policy. IRS guidelines can be found here.
Memo for guidance on document retention and destruction and a sample document retention policy (Public Counsel Law Center).
The Sarbanes-Oxley Act (SOX) requires boards to be aware of and accountable for the acts of an organization. Also, the adoption of a document retention policy sets guidelines and facilitates directors' fulfillment of the duty of care, establishes transparency and ensures compliance.
Florida Statute requires the following:
496.418 Records.—Each charitable organization, sponsor, professional fundraising consultant, and professional solicitor must keep for a period of at least 3 years true and accurate records as to its activities in this state which are covered by ss. 496.401-496.424. The records must be made available, without subpoena, to the department for inspection and must be furnished no later than 10 working days after requested.
617.1601 Corporate records.—
Keep these records permanently
- Articles of Incorporation
- Audit reports, from independent audits
- Corporate resolutions
- Determination Letter from the IRS, and correspondence relating to it
- Financial statements (year-end)
- Insurance policies
- Minutes of board meetings and annual meetings of members
- Real estate deeds, mortgages, bills of sale
- Tax returns