The governance questions on Form 990, explained
Every charity page lists the organization's own answers to a set of governance questions on Form 990. Here's what each one asks. A "no" is a reported fact, not a finding, and organizations often explain answers in Schedule O.
- Voting board members and independent members (Part VI, lines 1a–1b): how many people vote on the governing body, and how many are independent (not paid as employees or contractors, and without certain financial relationships).
- Family or business relationships (line 2): whether any officers, directors or key employees are related or have business ties.
- Diversion of assets (line 5): whether the organization became aware during the year of a significant diversion of its assets, such as theft or embezzlement. Organizations that answer yes explain in Schedule O.
- Form 990 given to the board (line 11a): whether the board received a copy before filing.
- Conflict-of-interest policy (line 12a), whistleblower policy (line 13) and document retention policy (line 14): whether written policies exist.
- Process for setting pay (line 15a): whether the top executive's compensation was reviewed by independent people, using comparability data, with the decision documented.
- Excess benefit transaction (Part IV, line 25a): whether the organization engaged in a transaction that gave an insider more than fair value, which the law penalizes.
- Loans to or from insiders (Part IV, line 26).
- Audited financial statements (Part XII, line 2b): whether an independent accountant audited the financial statements.
These answers describe policies and events, not results. Policies on paper and practice can differ, and small organizations may have reasonable informal processes.