The Mikuska Group  

Navigating charity rules

You’re passionate about your mission and you’re operating as a registered charitable organization in Canada. In addition to fulfilling your mission (feeding kittens, housing street youth, saving the planet), you issue donation receipts, hold fundraising events, send direct mail appeals, send a call to action to your supporters to take the government to task for policies and laws you feel should be changed – the list goes on.

Do you know what a qualified donee is? Do you know the definition of a gift? Do you understand split-receipting? Can you define “advantage”? How does it affect your receipting? Do you know the definition of “political activity” and how much you can do? Are your by-laws up to date?

The rules around operating a charitable organization are vast and at times complex. But fear not, there are excellent resources available to help you navigate these particular waters:

  • Canada Revenue Agency’s Guidance Fundraising by Registered Charities – this is a must-read by the people in your organization who are fundraising.
  • Canadian Charity Legal Checklist – compiled by Mark Blumberg at An excellent overview of activities with links to more detailed information.
  • Canada Revenue Agency’s Charities and Giving website – detailed information and guidance on any topic you can imagine (including answers to the questions in paragraph #2!).

You’ll also need to consult with your legal counsel in the event of a complicated situation, for example, updating your by-laws, gift agreements and filing your charitable tax return.

It’s your responsibility to be in the know – ignorance is not a defence!

Laura Mikuska


Governance is not a dirty word

If you work in a nonprofit or charitable organization, or serve on a board of one of these organizations, chances are you’ve tackled the notion of “governance”. The very word is enough to make people’s eyes glaze over and have them scrambling for the exits.

Yet when done well, governance contributes to the overall health and sustainability of the organization. It’s not just about “bums in seats”, but requires all board members to be active participants in discussion and decision-making.

A healthy board:

  • has a strong chair who facilitates conversation and discussion
  • has members that come to each meeting prepared to voice opinions
  • has everyone attend meetings having read the reports and minutes
  • tolerates dissent but speaks with one voice
  • can make decisions in a timely matter because quorum is met every time

An unhealthy board:

  • has a dominating or weak chair who is ineffective in facilitating discussion
  • has members who don’t participate or who remain silent to avoid controversy
  • has members who dominate the discussion
  • has members who come unprepared; unable to contribute because they are not up to speed
  • has instances of “sidebar conversations” outside the meetings that don’t involve the entire board
  • has “rogue” board members who act contrary to the will of the board
  • has difficulty reaching quorum due to non-attendance of board members

Funders are increasingly making decisions about where to invest based on the health of your board. Which type of board would you rather have?

Laura Mikuska


By-laws are forever – not!

When was the last time your organization reviewed its by-laws?

Good on you if you said, “within the last three years.” If it’s been longer, or, as in the case of some organizations, not since they were written in the 1970s, it’s time.

Your by-laws are your governing documents. They are important and deserve your attention. Circumstances change over time, including changes to legislation that governs non-profit organizations.

By-law reviews are opportunities to look at how your board is working. A couple of examples:

  • previous boards may have thought it was an honour to allow all living past-presidents to be on the board. However, you may now find that rather than being a helpful resource/organizational memory, these members just add to the sheer size of the board, making it unwieldy. Your review may then recommend an advisory council for past-presidents, rather than seats on the board.
  • current by-laws stipulate no term limits for board members, so your board becomes stagnant when members don’t see a reason to leave. Ensuring turn-over is healthy.

By-laws lay out structure and the legal duties and liabilities of your board. They should reflect and refer to the act under which your organization has been created, and outline the powers of the board, composition, voting, membership and financial responsibility.

Be careful not to put too much into your by-laws that would be better left to board policies. By-laws must be approved by the members, while policies can be changed by the board. For example, avoid too many standing committees and allow for ad-hoc committees or task forces.

And once you’ve reviewed and approved changed by-laws, schedule the next review!

Julie Mikuska


Engagement audit

You may think your organization is responsive to donors, welcomes them, promptly acknowledges gifts and is great at engagement and stewardship. Your donors may have an entirely different experience. How can you find out?

Ask several friends or colleagues from other organizations to help you perform an engagement audit. Ask each of them to donate or make inquires about donating, by phone, in person, by e-mail or through online donations. Essentially, the group should go through all the ways that people can donate to the organization, even through events (galas, runs, walks). Then ask them to evaluate their experiences. (You can offer to do the same for their organization.)

  • How are they received in person? on the phone? via e-mail?
  • Do frontline staff know about the mission? Do they know what happens with donations? Are they customer-friendly?
  • Are calls to senior people returned?
  • How friendly and up-to-date is your website? Is the donate button prominent? Is the donation form easy to fill out?
  • Are gifts acknowledged promptly, accurately and with a CRA-approved receipt?
  • Are donors welcomed as trusted friends or as ATMs?
  • Is there evidence of good stewardship and communications?

Use what you find out to improve your donors’ experience and engagement. External audits like these can be powerful when showing others in your organization what constitutes a culture of engagement.

Julie Mikuska


Long-term board members can hurt your organization

If your board has members who have served longer than 10 years with no end in sight, you should think about a by-law review to include term limits.

“But,” you say, “We need their institutional memory! We need their long-term perspective!”

You may well value those assets, but you don’t need them taking up a seat on your board.

Members who have been there a long time can suck the energy out of your board. Newer members defer to their “wisdom.” They disengage from the work of the board. They stop debate by saying “We tried that, it didn’t work, so we shouldn’t try it again.” Who can argue with that logic, right? Wrong.

Board members need to feel they are all contributors and be expected to contribute to decision-making. They should be recruited for their skill, experience and passion for the mission. And they should know from the outset that their time on the board comes with limits. Not only will this actually help in recruiting and retaining good members, it will ensure you have continuous renewal.

As for those long-time board members? Create an honorary advisory committee, and commit to bringing them together regularly. Appoint an honorary historian of the board. Ask them to head a task force. Keep them engaged, just not as board members.

Julie Mikuska


Demystifying fund development – one client’s view

Mikuska Group has been working with The Centre for Christian Studies to develop an culture of engagement, and has been mentoring the new Development Coordinator, Lori Stewart and the Principal, Maylanne Maybee in the principles and practices of fund development. Maylanne recently reflected on their experience in the CCS newsletter:

“Lori Stewart is growing into her Development Coordinator role. Since starting in July, she has been connecting with many grads, students, and friends of CCS…listening to their different stories of being touched and changed.

Lori and I have been part of weekly coaching sessions over the summer and early fall with Laura Mikuska, a member of the Mikuska Group which specializes in helping non-profit groups build strong relations with their donors.

Together we have had discussions on donor-related policies, thinking about a development page on our website, creating and using a fund development plan. We’ve talked about the message we want to send out about CCS – what sets us apart, avoiding jargon and “inside” language, how people find out about us. Lori has paid close attention to the “how to’s” of building a case for support, writing and distributing an appeal letter, receipting donations, thanking donors. We’ve talked about making connections, through visits, phone calls, and the telling of stories.

From my perspective, these sessions have helped to demystify the role of “fund development”, to reframe it as building a culture of engagement and generosity and creating an inviting context for people to support the important work of CCS. Lori has re-introduced the Development Lunch at the Learning Circles as a way of engaging our students in building relationships with our wider constituency. And Laura will be doing a workshop with staff and Central Council as a way of empowering them with the permission and tools to act as ambassadors on our behalf.

This fall, you will see the result of Lori’s learning and research. She plans to mail twice as many appeal letters as before, as a benchmark for future mailings. You will see a fresh, thoughtful, and we hope persuasive invitation to make an annual or monthly donation to CCS. Join us as we grow our spirit of engagement and generosity!”

Lori and Maylanne are both passionate about the mission of CCS, but were not very familiar with fund development or the concept of a culture of engagement. Through understanding the principles and processes, they are building their fund development program and engaging their constituents by inviting them to have an impact as a donor.

Can Mikuska Group demystify fund development for your organization?

Laura Mikuska



The fundraising audit 101

You need a fundraising audit if:

  • you have a mature program and want to know how you can propel it to the next level
  • you have an events-based program and you want to start a major gifts program
  • you aren’t sure whether your program is effective
  • you want to start a fundraising program

The audit looks at your processes, policies and technology and how effective they are in supporting your program.

Processes: how you ask, acknowledge, thank, recognize, research and communicate, and who is involved

Policies: general fundraising, gift acceptance, prospective donor identification and research, naming and recognition, third-party fundraising

Technology: what you are using to keep records and generate reports

The audit reveals how you are performing now and what is required to meet your goals. It includes departments or functions outside the development office (e.g. finance, communications, marketing). It looks at how your board is (or is not) involved and what their understanding is of their role.

The audit also looks at how your development plan supports the overall organizational goals, and vice versa.

Julie Mikuska.


Boards: Orientation is not just for newbies

Most people joining a board expect some type of orientation. Sometimes it’s in the form of a binder and perhaps a session with other new members.

But boards and executive directors lose an opportunity to bring the whole board together by only orienting new members. All board members benefit from the chance to learn and be reminded of the organization’s mandate, programs, committees, history, governance and policies. It’s when members can inform each other about why they are on the board and what they hope to contribute.

Orientation is a form of professional development for board members. Other learning opportunities that will help them better understand their board role include understanding financial statements/budget, risk management and liability, succession planning and strategic recruitment, principles of good governance and the role of the executive director.

Even those who think they know everything can contribute to other board members’ knowledge (and maybe they’ll learn something themselves in the process). Take the time to invest in your professional development – an educated and informed board is an effective board.

Julie Mikuska


What did you just agree to?

Imagine these scenarios:

  • The CEO of your non-profit has accepted a major gift for your capital campaign from a local business. She and the president of the company shook hands on it, agreed that the donor’s name would go on the new facility, and the company issued the cheque. Just before the name is to be put on the building in time for the official opening, the CEO learns that the company has been convicted of fraudulent business practices. The board decides to reject the name for the building. However, the company’s president insists on the non-profit keeping its promise, saying the handshake agreement was the only agreement and the board had no policy on rejecting gifts. A judge sides with the company.
  • A university accepts a gift for one of its faculties to help build new space, and enters into an agreement to name a particular room after the donor. The donor is recognized with a plaque outside the room. Several years later, the dean of the faculty decides to redevelop the space, and raises new capital from donors who are recognized by naming the new space after them. When the original donor discovers his name has been removed from the space, he sues the university and demands his gift back, producing the original gift agreement that called for consultation with him should the space be redeveloped.

In both of these cases, those accepting the gifts didn’t pay enough attention to written agreements and policies.

In the first case, without a signed gift agreement that included a morals or ethics clause, the non-profit doesn’t have the right to reject the gift or the naming. So it’s critical to have gift agreements that say something like: “The Donor understands that the reputation of the (organization) cannot be associated with any immoral or unethical activities, or activities which display a lack of integrity.”

In the second case, the dean and the university didn’t abide by the signed gift agreement, and the donor was well within his rights to demand his gift back.

In the absence of a signed gift agreement, it’s important that a robust gift acceptance policy be in place, which will protect the organization and be transparent to prospective donors. Have the policy and any gift agreements reviewed by legal counsel. It’s worth the investment.

So what did you just agree to?

Julie Mikuska


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