3 Steps to Ensure Your Not-for-Profit's Compliance to ONCA

Navigating the transition to the new Ontario Not-for-Profit Corporations Act (ONCA) regulations can seem overwhelming for not-for-profit organizations. However, breaking it down into manageable steps can streamline the entire process and help ensure your organization complies with the new regulations.

This post will outline three key steps your not-for-profit organization can take to ensure compliance with ONCA.

Step 1: Understand the Changes

The first crucial step in ensuring compliance with ONCA is to thoroughly understand the critical aspects of the new regulations and how they differ from the current laws. ONCA introduces new rules for membership, governance, and financial reporting. This understanding is not just important, it's essential as these changes will directly impact your organization's bylaws, Letters Patent, and other governing documents. To start, delve into the ONCA requirements, consult legal experts, and gather information on how the changes will affect your organization.

Step 2: Review and Update Documents

The next proactive step is to meticulously examine your organization's bylaws, Letters, Patents, and other governing documents to ensure they align with ONCA requirements. This includes ensuring that your organization's purpose, membership, governance structure, and decision-making processes comply with ONCA regulations. Review your organization's governing documents to ensure compliance and identify any areas that require updating. This could include updating your organization's bylaws to include provisions for electronic voting or updating your Letters Patent to reflect changes in your organization's name or structure.

Step 3: Educate Your Team

Lastly, it's of utmost importance to ensure that everyone in your organization, from the board members to the staff, is fully aware of the changes and how they will impact their roles and responsibilities. This includes comprehensive training on the new regulations, updating job descriptions, and communicating any changes to your organization's policies and procedures. To educate your team, organize training sessions or workshops to ensure everyone is up to date on the new regulations. You can also provide resources such as guides or FAQ documents to help your team navigate the changes.

Following these three steps, your not-for-profit organization can smoothly transition to the new regulations under ONCA, ensuring legal compliance and operational efficiency. It is crucial to begin the process as soon as possible to allow ample time to make necessary changes before the new regulations occur.

Remember, compliance with ONCA is essential for your organization's success, and taking the necessary steps now can save you time and money in the long run.

Overview of ONCA Compliance for Ontario Not-for-Profit Corporations

Transitioning to the Ontario Not-for-Profit Corporations Act (ONCA) requires careful attention to several core areas of our organization’s governance and operations.

The updated legislation changes how we manage bylaws, membership, and reporting. Our governing documents such as Articles of Incorporation and by-laws may need substantial revision.

Key areas to focus on include:

• Membership and Voting Rights: ONCA introduces new rules about membership classes and members’ rights.
  
  These updates include provisions for absentee voting and clearer processes for member participation in meetings and proposals.
  
  
• Governance and Director Roles: The act clarifies directors’ duties and outlines options for indemnification.
  
  Our leadership must understand these changes to maintain proper oversight.
  
  
• Financial Accountability: ONCA sets new requirements for financial reporting.
  
  It extends transparency expectations to all not-for-profit corporations, not just public charities under the Canada Revenue Agency.
  
  
• Document Review and Updates: We must review and update our governing documents—including Letters of Patent and articles of amendment.
  
  Legal advice can help ensure accuracy.
  
  
• Incorporation and Registry Compliance: The Ontario Business Registry manages filings related to ONCA.
  
  We need to keep up with incorporation documents and ongoing compliance requirements.
  
  
• Education and Transition Planning: We must educate our team about the new regulations.
  
  Resources like the Not-for-Profit Incorporator’s Handbook and support from groups such as Community Legal Education Ontario can help.
  
  

Important deadlines: Ontario not-for-profit corporations had until October 18, 2024, to update their structures under ONCA.

Although the transition deadline has passed, many organizations continue to refine their policies to meet ONCA standards.

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By focusing on these points, we help our organization operate effectively under ONCA's modernized framework.

Careful planning and active participation from everyone are vital to maintain compliance and support our mandate as a public benefit corporation in Ontario.

Conclusion

Navigating ONCA compliance doesn't have to be overwhelming when you have the right legal guidance. The transition to Ontario's modernized not-for-profit framework requires careful attention to governance structures, membership rights, financial reporting, and document updates. While the October 2024 deadline has passed, many organizations are still working to fully align their operations with ONCA standards, making expert legal support more crucial than ever.

At B.I.G. Charity Law Group, we specialize in helping Ontario not-for-profit corporations achieve and maintain ONCA compliance. Our experienced team understands the complexities of transitioning governance documents, updating bylaws, and ensuring your organization meets both provincial and federal requirements. Whether you need assistance with membership structure revisions, director duty clarification, or financial reporting compliance, we provide practical solutions tailored to your organization's unique needs.

Ready to ensure your not-for-profit is fully ONCA compliant? Contact us at B.I.G. Charity Law Group today at dov.goldberg@charitylawgroup.ca or call 416-488-5888 to discuss your compliance needs. Visit CharityLawGroup.ca to learn more about our services and schedule your FREE consultation to take the first step toward confident ONCA compliance and effective governance for your organization.

Frequently Asked Questions

How Can We Make Sure Our Business Meets Both Local and Federal Rules?

To stay compliant, we must:

• Know which rules apply at both local and federal levels.
• Keep all registrations and licenses current.
• Review changes in laws that affect us.
• Train our team on compliance requirements.
• Document our compliance efforts for future reference.

What Is Ontario’s Not-for-Profit Corporations Act, 2010 (ONCA)?

ONCA is a law that sets out how non-profit groups in Ontario should form and operate.

It replaced older rules to help non-profits run more smoothly. The Act covers governance, member rights, and reporting duties.

Organizations must update their rules to match ONCA to stay legally compliant.

What Rules Govern Not-for-Profit Organisations?

Not-for-profits must follow rules about:

• How they are formed and managed.
• How meetings and votes take place.
• Keeping financial records and reporting.
• Protecting members’ rights.
• Filing documents with the government.

Following these rules helps groups stay transparent and accountable.

How Do We Confirm We Are Following All Applicable Laws?

We confirm compliance by:

• Checking that our policies align with laws.
• Reviewing and updating governing documents.
• Conducting internal audits or reviews.
• Seeking legal advice when unsure.
• Keeping clear records of decisions and actions.

How Do We Stay Compliant with Financial Rules?

To comply with financial regulations, we:

• Keep accurate and up-to-date financial records.
• Follow proper budgeting and spending procedures.
• Prepare and file required financial reports.
• Have controls in place to prevent misuse of funds.
• Conduct regular financial audits or reviews.

How Do We Ensure We Follow Our Own Policies and Procedures?

To follow our policies, we:

• Communicate policies clearly to everyone.
• Provide training and resources so everyone understands expectations.
• Monitor activities to quickly spot issues.
• Address breaches promptly and fairly.
• Review and update policies regularly.