As many in the not-for-profit space know, the BC Societies Act came into effect on November 28th, 2016 with the intention of governing how societies (not-for-profit organizations) are created and run in British Columbia. Included in the act are a variety of updates that enable societies to have more flexibility in the way that they operate, as well as provisions that protect the public’s interest.
All societies incorporated in British Columbia are required to transition to the new act by November 28, 2018. In order to ensure that your society complies with the standards set forth in the new act, we have put together a list of some of the key areas for consideration for organizations affected by the change. The good news is there are many resources to help with the transition process; the bad news is that there can be unforeseen consequences as a result of these changes.
Constitution and Bylaws
Prior to the transition to the new Act, societies were able to create a constitution that stated a number of objectives or requirements of the organization. Following the transition, only the society’s name and purpose are to be included as the constitution, with all other statements and additional organizational requirements making up the bylaws of the organization.
Statement of Directors and Registered Office
The information regarding directors and registered office filed with the Corporate Registry is required to be up to date upon transition. This can be updated at any point before the transition.
Up to date filing of annual reports is required prior to transition.
Member-funded or not
Upon transition, a society will need to decide if it is a member-funded society or not. A member-funded society is funded primarily by its members.
A number of requirements are influenced by the decision, including the required number of directors, financial statement distribution, disclosure of remuneration of directors, employees and contractors and more.
Additionally, further requirements for societies come into effect on November 28, 2017:
A majority of directors of a non-member funded society must not be employed by or be under contract with the society.
There are new qualification requirements for directors and senior managers.
All directors must provide written consent to act as directors for the society.
As you can tell, the Societies Act goes into quite a bit of detail regarding how not-for-profit organizations conduct their business. We highly recommend that you review the Act in detail, which can be found on the BC Registries and Online Services website. If you have any questions regarding the changes to the Act, our team is more than happy to help. Contact us today to learn more about our bookkeeping services for not-for-profit organizations.