Keeping Records


Keeping records

This section of the Charity Filing Guide includes practical ideas you can use to develop record-keeping processes that work for your small charity. Developing processes and systems that everyone in your charity knows and uses can help develop organizational memory. Organizational memory means that the knowledge of how and why to do something is retained by the organization. Knowledge that the group needs doesn't leave when a board member resigns or a volunteer moves on. It lives in the processes and records maintained by the charity. Developing processes that support organizational memory is an important part of good fiscal management.

In terms of preparing Form T3010-1, good record-keeping practices are essential. It's easier to complete the forms if you can find the information quickly, and if you can trust that the information you find is accurate and complete. This isn't a one-person job. Even in a very small charity, it is essential that more than one person is familiar with the record-keeping process, knows the books, knows where records are stored, and knows how to complete the form. The knowledge of how to complete the essential task of filing the T3010-1 Information Return should be a shared responsibility. One way to accomplish this is to involve the board of directors or board of trustees. Every year, add agenda items to the board meeting calendar for key events in the filing process: receive the forms from CRA, complete the forms, and submit the forms. Make the board responsible for managing the process. This serves as a reminder for staff and volunteers to keep on top of the filing process, and it involves the board so that they can provide support if necessary.

Links to information on this page

Points to remember
Questions your record-keeping system should be able to answer
Record-keeping ideas
Process tips
CRA requirements for books and records
See other pages in the Charity Filing Guide
Links to the CRA website
Links to other websites

Points to remember

  • Keeping books and records up-to-date is the key to keeping on track.
  • Get a P.O. Box to use as a central mailing address for your charity.
  • Be sure all board members know where important documents are stored.
  • Develop a method to report expenses by account type or by the activity categories required on Form T3010-1.
  • Add the deadline for completing the T3010-1 Registered Charity Information Return to the board’s annual calendar. Make the board responsible for ensuring that the return is completed in good time and submitted by the deadline.

Questions your record-keeping system should be able to answer

The following questions are intended to start you thinking about your current accounting and record-keeping systems. Do they provide the information you need, when you need it, without an undue amount of effort? If not, how could you make changes that would improve your systems?

General Information

  • Do you know your charity’s date of incorporation? (if applicable)
  • Do you know who has signing authority for your charity?
  • Do you know your charity's fiscal year-end date?
  • Do you know when the T3010-1 Information Return is due?
  • Do you know where to find the information you need to complete the return?
  • Do you know where your charity's books and records are stored?

Form T3010-1 Registered Charity Information Return

Section A: Identification

  • Do you know your charity's BN/registration number?
  • Do you know your charity's designation?

Section C: Programs and general information

  • Do you have short informative descriptions of your ongoing programs?
  • Did your charity conduct political activities?
  • Do you know all the fundraising methods your charity used during the year?
  • Do you know the details of your agreements with any external fundraisers?
  • Did your charity issue tax receipts on behalf of another group?

Section D: Financial information

  • Do you use accrual accounting or cash-based accounting?
  • Did your charity issue tax receipts?
  • Are your financial records up to date?
  • How much did your charity spend on charitable programs?
  • How much did your charity spend on management and administration activities?
  • Do you know the types of transactions recorded in each account?

Schedule 3: Compensation

  • Do you know the number of permanent, full-time, compensated employees?
  • Do you know the number of part-time or part-year employees?

Schedule 5: Non-cash gifts

  • Do you know what types of non-cash gifts your charity received during the year?
  • Did you issue tax receipts for non-cash gifts?
  • Did you use any non-cash gifts to deliver your charitable programs?

Schedule 6: Detailed financial information

  • Do you use accrual accounting or cash-based accounting?
  • Did your charity issue tax receipts?
  • Are your financial records up to date?
  • Do you know the types of transactions recorded in each account?
  • How much did your charity spend on charitable programs?
  • How much did your charity spend on management and administration?
  • How much did your charity spend on fundraising activities?
  • How much did your charity spend on political activities?
  • Did your charity receive gifts from other charities?
  • Did your charity have permission to accumulate property?

Form T1235(09) Directors/Trustees and Like Officials Worksheet

  • Do you know how many people served on your board of directors/trustees?
  • Do you know the date new board members joined the board?
  • Do you know the date board members left the board during the fiscal year?
  • Do you know the arm's length status of each member in relation to other board members?
  • Do you have up-to-date contact information for each board member?
  • Do you have each board member's date of birth on file?

Form T1236(10) Qualified Donees Worksheet/Amounts Provided to Other Organizations

  • Did you make any gifts to associated charities?
  • Do you know the full name of each group?
  • Do you know the BN/Registration number of each group?
  • Do you know the amount of gifts-in-kind you gave to each group?
  • Do you know the amount of designated gifts you gave to each group?
  • Do you know the total amount of gifts you gave to each group?

Record-keeping ideas

Board member records

  • Keep a file of contact information, including birthdates, for directors and officers of the charity. Add a new member's information to the file when he or she joins the board. Remember to update contact information if a board member moves.
  • Contact information (full name, address, phone number)
  • Birthdate (this information is sensitive; treat it with respect)
  • Date each member joined the board
  • Date each member left the board

Financial records

  • Keep books up-to-date throughout the year
  • Enter transactions when they occur
  • File financial documents (invoices, bills, receipts, cheque stubs, reports, etc.) promptly
  • Develop a method for reporting expense totals according to account type or according to the activity categories required on Form T3010-1. Section D asks you to report expenses for charitable programs and management and administration. Schedule 6 asks you to report expenses for charitable programs, management and administration, fundraising, and political activities.

Deadlines and due dates

  • Call CRA if you don't receive the T3010-1 Information Return before your fiscal year-end.
  • CRA sends one reminder letter before the filing deadline. Don't wait for the letter. It is your responsibility to file on time. Be sure CRA has the current address for your charity.
  • Add T3010-1 milestone dates to the Board meeting calendar. Share the responsibility for ensuring that the forms are completed and submitted on time. Milestones include: receive the return, produce financial statements, complete the return, review the return, sign the return, and submit the return.
  • Use your charity’s annual general meeting as a deadline to have the form completed, if it falls before the CRA deadline.

Reminders

  • Enter all reporting deadlines in your personal calendar.
  • Use a large, write-on wall calendar to record due dates and make them visible.
  • Use an online calendar, such as Google Calendar, that alerts you when events are due.
  • Subscribe to a free online reminder system that sends you an e-mail when events are due. For example, Remember the Milk, Memo To Me, or Hassle Me.
  • The Canadian Council of Christian Charities provides an e-mail reminder service for members.

Process tips

  • Check the online CRA Charities Listings a few months after you submit the T3010-1 Information Return to be sure that CRA entered your information correctly.
  • Purchase a P.O. box to use as a mailing address for your charity. If you have one central place to receive mail, it is less likely that important documents will go missing.
  • Keep a separate file of board member's contact information, including birthdates. If the information is filed away with the T3010-1 it will be hard to find. If you keep a file in your current records, you'll always have the information at hand. And, if it is easy to access, you’re more likely to keep the records up to date when board members move, leave, or join your board of directors or board of trustees.
  • Keep a file or list of important information about your charity in your current records. Include items such as, full name, date of incorporation (if applicable), BN/Registration number, charitable designation, address of your charity, address where your books and records are stored, fiscal year-end date, filing deadlines, etc. See the Handouts section in the Charity Filing Guide for a checklist of important information you can download and customize.
  • Be sure all board members know where important files are kept.
  • Use the PDF fillable/saveable version of the T3010-1 available on the CRA website to save an electronic copy of Form T3010-1. Once it's saved electronically, you can transfer repeated information, like ongoing program descriptions, from year to year by cutting and pasting. Note: Form T3010-1 is new every year and the information changes. You can cut and paste program descriptions that haven't changed, but financial information needs to be entered from scratch each year.

CRA requirements for books and records

This checklist is on the CRA website. It lists the types of records you should have in order to meet your obligations to CRA and how long you should retain each type of record.

CRA Keeping adequate books and records checklist

A registered charity must keep adequate books and records in either English or French, for the prescribed time period, at an address in Canada that is on file with the Canada Revenue Agency (CRA). The following checklist gives an overview of the general requirements.

Are the books and records of the charity kept as follows:

  • Copies of official donation receipts (other than for 10-year gifts) kept for a minimum of two years from the end of the calendar year in which the donations were made.
  • All records concerning 10-year gifts kept for as long as the charity is registered and for a minimum of two years after the date the registration of the charity is revoked.
  • Minutes of meetings of the directors/trustees/executives kept for as long as the charity is registered and for a minimum of two years after the date the registration of the charity is revoked or, in the case of a corporation, for two years after the day the corporation is dissolved.
  • Minutes of meetings of the members kept for as long as the charity is registered and for a minimum of two years after the date the registration of the charity is revoked.
  • All governing documents and bylaws kept for as long as the charity is registered and for two years after the date the registration of the charity is revoked.
  • General ledgers or other books of final entry containing summaries of year-to-year transactions and the vouchers and accounts necessary to verify the entries kept for six years from the end of the last tax year to which they relate, for as long as the charity is registered, and for two years after the date the registration of a charity is revoked or, in the case of a corporation, for two years after the day the corporation is dissolved.
  • Financial statements, source documents, and copies of T3010 returns kept for six years from the end of the last tax year to which they relate or, if the charity is revoked, for two years after the date of revocation. Source documents may include items such as invoices, vouchers, formal contracts, work orders, delivery slips, purchase orders, or bank deposit slips.

Notes
The charity should keep all its key documents (constitution, bylaws, registration letter, etc.) along with its books and records in one area for easy access. This will make it easier for the charity in the case of an audit or when there is a change to the governing board.

Copies of key documents and records should also be kept in a separate location (preferably off-site) for back-up purposes.

http://www.cra-arc.gc.ca/chrts-gvng/chrts/chcklsts/bks-eng.html

See other pages in the Charity Filing Guide

See Handouts for Word versions of the accounting process timelines that you can customize.

Links to the CRA website

Keeping records
http://www.cra-arc.gc.ca/E/pub/tg/rc4409/rc4409-e.html

Keeping books and records
http://www.cra-arc.gc.ca/chrts-gvng/chrts/prtng/bks-eng.html

Checklist: Keeping adequate books and records
http://www.cra-arc.gc.ca/chrts-gvng/chrts/chcklsts/bks-eng.html

Charities Directorate website
http://www.cra-arc.gc.ca/charities/

Guide T4033-1 Completing the Registered Charity Information Return
http://www.cra-arc.gc.ca/E/pub/tg/T4033-1/README.html

CRA Charities Listings
http://www.cra-arc.gc.ca/chrts-gvng/lstngs/menu-eng.html

Links to other websites

Google Calendar
http://www.google.com/calendar

Remember the Milk
http://www.rememberthemilk.com

Memo To Me
http://www.cra-arc.gc.ca/tx/chrts/menu-eng.html

Hassle Me
http://www.hassleme.co.uk

The Canadian Council of Christian Charities
http://www.cccc.org