ASSOCIATION ADMINISTRATION

This page explains how to manage an association. 

The board manages the association’s activities.  

The board includes 

  • chairperson 
  • vice-chairperson 
  • secretary 
  • treasurer 
  • other board members 

The board must:
– Work fairly and follow the rules.
– Make sure the association follows the law.
– Treat its members equally, and the board has no special rights.  

Members, trustees and officers in an association 

Members 

The members have the power to make decisions in the association. Members can attend meetings, vote, and give their opinion on what the organization does. Members are not responsible for the association’s debts or decisions. For example, if the association makes a decision that causes it to run out of money, a member does not need to give money to the association.  

All members of the association are equal. A member is not obliged to take up a position of trust in the association.  Members can use the association’s services but don’t have to participate in the association’s activities. Members can see the association’s documents but not board meeting minutes. If the association makes decisions that break the law or violate a member’s rights, members can take legal action.  

Chairperson and vice-chairperson 

The association’s chairpersons are the chairperson and the vice-chairperson. They must be over 18 years old. They must have an address and residence permit in Finland. The chairperson of the association must be of good character. They also need to manage their own finances properly. This means that they must not have any debts under enforcement proceedings.  

The vice-chairperson steps in when the chairperson is away.  

Duties of the chairperson: 

  • lead the work of the board and staff 
  • ensure that the work of the association is improved 
  • communicate with external parties, such as partners 
  • participate in the activities of the association 
  • sign the association’s documents, unless otherwise stated in the rules of the association 
  • sign official notices of the association, such as the charter. 

Secretary 

Duties of the Secretary: 

  • record minutes during board meetings 
  • handle notifications to the authorities, for example if the association’s details change 
  • write the first version of the association’s annual report 
  • keep a register of members. 

Treasurer  

The duties of the treasurer: 

  • plan the association finances together with the board 
  • manage the association finances according to the instructions of the board 
  • report finances to the board at the meeting 
  • keep the accounts, if it is a small association 
  • if it is a large association, monitor the financial situation if the association has an external accountant. 

Officers  

Officers work for the association but are not members of the board. They are usually chosen by the board. They may lead groups or help with the association’s activities.   

Executive director or secretary-general  

The executive director or secretary-general manages the association’s activities. Not all associations have an executive director or secretary-general. Instead the chairperson of the board is in charge of the association’s activities. The managing director or secretary-general typically manage associations that operate professionally. 

If the executive director or secretary-general work as an employee of the association, they are managed by the board. In that case, they cannot be a member of the board at the same time.  

The tasks of the executive director or secretary-general are agreed in writing in the association’s rules and an employment contract, for example. It is also agreed what kind of decisions the executive director or secretary-general can make in the association.  

The same employment laws apply to the executive director or secretary-general as to other employees. However, there may be some exceptions, such as longer notice periods or more flexible working hours. 

The tasks of the executive director and the secretary-general: 

  • manage the association’s day-to-day operations and administration 
  • cooperate with the chairman of the board 
  • prepare board meetings 
  • attend board meetings, if the board has so decided 
  • give the board information about the activities of the association. 

The executive director or the secretary-general may sign the association’s documents if allowed by the association rules. These documents can include contracts and official letters, for example. 

Operations inspector 

An operations inspector is the person who makes sure that the association is operating and spending money according to the rules and laws.   

The operations inspector must have a good knowledge of finances and the law. The operations inspector should be free to give their opinions without pressure from others. That’s why the operations inspector cannot be a member of the board or an officer in the association.  

A member of the association can serve as an operations inspector. They must be over 18 years old. They must have full legal capacity. This means they must be able to manage their financial and legal affairs independently. They cannot be bankrupt.  

Tasks of the operations inspector: 

  • make sure that the association’s administration is following the law and other rules 
  • make sure that the accounts and financial statements are correct 
  • make sure that the benefits of the board, such as meeting fees, are fair  
  • make sure that the board members do not use the association’s money for themselves or their families 
  • make sure that all members are treated equally.  

The board of the association must assist the operations inspector. Before the association’s annual meeting, the board must give the operations inspector all important documents, such as the financial statements and the annual report. The documents must be given to the operations inspector a few weeks before the meeting. This gives the operations inspector enough time to check the documents and write an inspection report.   

An association must have an operations inspector if it does not have an auditor. The members of the association choose the operations inspector at the association’s meeting.  

Auditor 

The auditor checks that the association’s finances are managed correctly. The auditor is an external person who is not a member of the board or an officer in the association. 

An auditor must be chosen for the association  

  • if the association’s assets, shown by the balance sheet total, are more than €100,000 
  • if the association’s income is more than € 200,000 per year 
  • if the association employs more than three people 
  • if the association receives a lot of external funding, such as grants or donations. 

If the limits above are not exceeded, the association only needs to choose an operations inspector. 

Remember that the association’s income does not include general grants it may have received. General grants are grants used by the association for things like rent and salaries.  

Who makes the decisions in an association? 

Annual general meeting 

The annual general meeting is where members decide on important things for the association, such as the accounts, the budget, and the board. Members must be invited to the meeting in accordance with the association’s rules, for example, two weeks before the meeting date. Annual meetings may be held once or twice a year. 

If the association has one general meeting in a year, then the following matters will be discussed at the meeting:  

  • plan of operations and budget 
  • the previous year’s annual report and accounts. 

If these are approved, the board from last year is discharged. This means that the members decide that the previous board is no longer responsible for the association’s money or activities. A new board, chairman and operations inspector are then chosen. 

If there are two annual general meetings, 

  • the spring meeting discusses the annual report and accounts 
  • the autumn meeting discusses the plan of operations and budget and chooses a new board, chairman and operations inspector. 

Board 

The board runs the association and is responsible for its decisions. The board prepares a plan of operations and budget for the annual meeting. After the annual meeting has approved the plan and the budget, the board ensures that they are followed. The board itself cannot change the rules, plans or budget approved by the annual general meeting. 

Board meetings 

The board can decide when it has meetings. However, it must follow the association’s rules and manage things according to them.  

Members of the board 

The duties of a board member: 

  • learn about the association’s basic task, rules and history 
  • learn about the association’s plans 
  • know the previous year’s annual report and accounts 
  • know the association’s plan of operations and budget 
  • be honest and do what is agreed.  

Who holds the responsibility in the association? 

The board and officers are responsible for the activities and decisions of the association. The members of the association are not responsible for the decisions.  

Members of the board, the chairperson and the vice-chairperson are also called “trustees”. If a trustee loses the trust of others, they can be removed. A trustee is removed by the same people who chose him or her, for example, the board or the annual meeting.  

An employee of the association cannot be removed in the same way as a trustee. Employees must be treated according to the employment laws.  

If the members of the board, officers, operations inspector, or members of the association harm the association on purpose, they may have to pay for the damage. If more than one person is responsible for the damage, they must pay for the damage on their own behalf and on behalf of others. 

Read more about the auditor’s duty to pay damages. See the Finlex website (in Finnish). 

The Association Administration vocabulary 

Budget 

  • A budget is a financial plan that shows how much money the association will spend during the year. The board makes a budget every year. The annual meeting of the association approves it. 

Agenda 

  • The agenda is a list of topics that the members will talk about at the meeting. The agenda must be made and shown to the members before the meeting.  

Register of members 

  • The register of members is a list of the names and addresses of all the members. The register is managed by the board. 

Accounts 

  • Accounts are records of the association’s finances. The accounts are kept either by the treasurer or by a separate accountant. 

Minutes 

  •  The minutes are a record of the topics discussed in the meeting and the decisions made. The minutes must be checked and signed. 

Financial statements  

  • Financial statements are a report that shows how much money the association has at the end of a certain time, like the end of the year. It shows how much income the association has had, and what the money has been spent on. The financial statements also show if the association has made a profit or a loss.  

Annual report  

  • In the annual report, the board describes what the Association has done during the previous year. 

Plan of operations 

  • The board of the association draws up a plan of operations every year. It tells you what it intends to do in the coming year.  

Rules of the association 

  • The operations of an association are based on its rules of the association. The Associations Act explains what these rules must contain.  

Associations Act 

  •  The Finnish Associations Act governs both registered and unregistered associations. 

Finnish Register of Associations 

  • The Finnish Register of Associations is a list of all registered associations in Finland. The Finnish Register of Associations is maintained by the Finnish Patent and Registration Office.