MENTAL HEALTH ASSCOCIATIONOF GREATER CHICAGOMHAGC Financial Policies
andProceeduresand pFinancial Policies Manualand Procedures

Provided by:

Financial Technologies & Management

Mental Health Association of Greater Chicago

Copyright © 2021

Table of Contents

Introduction, Manual Protocol, and Accounting Guidelines and Internal Controls

3

Annual Audit

4

Annual Budget, Financial Statements

5

Insurance Coverage, Security

6

Record Retention

7

Cash Receipts and Revenue Processing

8

Cash Disbursements and Accounts Payable Processing

9

Travel Expense Reimbursement

11

Payroll and Human Resources

12

Net Asset Classifications

16

Notes Payable

17

Board Conflict of Interest Policy

18

Whistleblower Policy

20

Code of Conduct

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Introduction
The purpose of this manual is to set policies & procedures that are consistent with the missionof the The Mental Health Association of Greater Chicago (MHAGC). Also, the purpose of thismanual is to set sound financial guidelines that promote prudent fiscal management; and to
abide by Generally Accepted Accounting Principles (GAAP) and the legal requirement
governing MHAGC.

Manual Protocol

1) MHAGC management will review the financial practices annually. Any
recommended revisions will be presented to the Finance Committee of the Board of
Directors.
2) The Finance Committee will review and recommend financial policies andprocedures changes to the Board of Directors who will review and approve all changes
to financial policies and procedures.

Accounting Guidelines and Internal Controls
To ensure that record keeping is in accordance with Generally Accepted Accounting
Principles (GAAP) and appropriate internal controls are maintained. The following procedures
are to be followed:
1) Standard accounting procedures, in accordance with GAAP, will be utilized for all
financial functions.
2) Accounting will be done on the accrual basis.
3) The Chart of Accounts will be utilized, reviewed annually and updated as required.
4) Periodic, unannounced, internal audits will be performed by the Executive Director
or the Finance Committee of the Board to ensure that the stated operating guidelines
have been followed.
5) To ensure optimal internal controls, MHAGC will separate functional
responsibilities as recommended by GAAP, to the extent possible based on staffing
resources.
6) The administrative assistant will maintain financial records in accordance with therecord retention policy or as determined by Federal, State or local law.
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7) All Accounts Payable records will be stored by fiscal year and alphabetized by vendor.
8) All Accounts Receivable and Payroll records will be stored by fiscal year.

Annual Audit
It is the policy of MHAGC to arrange for an annual internal audit of the Organization's
financial statements to be conducted by the Treasurer/Finance Chair. When finances
permit, MHAGC shall have an external audit completed. The independent accounting firm
selected by MHAGC will be required to communicate directly with the MHAGC's FinanceCommittee upon the completion of their audit. In addition, members of the FinanceCommittee are authorized to initiate communication directly with the independentaccounting firm.
Audited financial statements, including the auditor's opinion thereon, will be submitted andpresented to the Board of Directors by the independent accounting firm at theOrganization’s Annual Meeting, after the financial statements have been reviewed andapproved by the Audit Committee.
Annual audits (internal or external) should be done annually to ensure the accuracy inaccounting functions and to facilitate positive audit results.
1) The designee appointed by the Executive Director or the Treasurer or FinanceCommittee Chair would conduct the internal audits of accounts receivable, payroll,and accounts payables semi-annually.
2) The designee conducting the audit will prepare an audit report and submit the report to the
Executive Director and/or the Finance Committee for review.
3) The Executive Director will retain the records regarding the results of all internal audits
and report inconsistencies or problems to Finance Committee as appropriate.
Interim Procedures - To facilitate the timely completion of the annual audit, theindependent auditors may perform selected audit procedures prior to MHAGC’s year-end.
By performing significant portions of audit work as of an interim date, the work required
subsequent to year-end is reduced. MHAGC staff will do as much as possible in order toprovide requested schedules and documents and to otherwise assist the auditors during
any interim audit fieldwork that is performed.
Throughout the audit process, it shall be the policy of MHAGC to make every effort toprovide schedules, documents and information requested by the auditors in a timely
manner.

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Annual Budget
The annual budget process requires planning and preparation of management and staff. A
budget should be designed and prepared to direct the most efficient and prudent use of
MHAGC’s financial and human resources. Guidelines need to be in place so that the budgeting
process runs smoothly. The following guidelines represent basic budgeting steps:
1) The accountant, with the support of the Executive Director, will present an annual
budget to the Finance Committee one month before the end of the current fiscal year.
Once approved by the Finance Committee and Executive Committee, the budget will bepresented to Board of Directors for review and approval. The Budget must bepresented to the Board of Directors during its June or July meeting.
2) The budget will be developed based on historical as well as projected costs for eachprogram. Everyone will provide input into the budget development.
3) In the event that MHAGC desires to add or expand programs, a budget amendment
may be proposed. The Finance Committee will recommend to the Board of Directors
who must approve all additional programs or program expansions.
4) The purpose of adopting a final budget at the beginning of the MHAGC's year is toallow time for the accounting department to input the budget into the accounting systemand establish appropriate accounting and reporting procedures.

Financial Statements
Standard Financial Statements
Preparing financial statements and communicating key financial information is a necessary
and critical accounting function. Financial statements are management tools used in making
decisions, in monitoring the achievement of financial objectives, and as a standard method
for providing information to interested parties external to MHAGC. Financial statements
may reflect year-to-year historical comparisons or current year budget to actual
comparisons.
The basic financial statements of MHAGC shall include:1.
2.

Statement of Financial Position (Balance Sheet) - reflects assets, liabilities andnet assets of MHAGC and classifies assets and liabilities as current or noncurrent/long-term
Statement of Activities (Income Statement) - presents support, revenues,
expenses, and other changes in net assets of MHAGC, by category of net asset(unrestricted, temporarily restricted and permanently restricted)
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3.
4.

Statement of Cash Flows (Development Sheet) - reports the cash inflows andoutflows of MHAGC in three categories: operating activities, investing activities,
and financing activities
Statement of Functional Expenses (Summarized by Program Totals) –presents the expenses of MHAGC in both a natural, or objective, format and byfunction (i.e. which program or supporting service was served)

Frequency of Preparation
The objective of the administrative assistant is to prepare accurate financial statements inaccordance with generally accepted accounting principles and distribute them in a timely andcost-effective manner. In meeting this responsibility, the following policies shall apply:A standard set of financial statements described in the preceding section shall be producedon monthly basis, by the 10th of each month. The monthly set of financial statements shallbe prepared on the accrual method of accounting, including all receivables, accounts payable
received by the 10th of the month. All financial statements and supporting schedules shallbe reviewed and approved by the Executive Director.
After approval by the Executive Director, a complete set of financial statements quarterly
shall be prepared and distributed as follows:
1. Treasurer and Finance Committee Members
2. Executive Director
3. Board of Directors

Insurance Coverage
Annually insurance coverages need to be reviewed to ensure that MHAGC maintains adequate
property, liability and employee insurance.
1) The Executive Director and the insurance broker shall review the insurance policy limits
on property and contents based on current value and new capital purchases upon policy
renewal.
2) The Executive Director will report to the insurance broker any purchase of equipment orproperty which could surpass the limits of current insurance coverage.
3) The Executive Director will meet with the insurance broker to discuss Director and Officer
insurance and general liability insurance coverage a minimum of one time per year.
4) The Executive Director will prepare a status report on all insurance coverage levels andpremium expenses a minimum of one time per year. This information will be presented to
the Finance Committee of the Board of Directors.

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Security
Accounting Department
A lock will be maintained on the door leading into the Administrative Assistant’s Office.
This door shall be closed and locked in the evenings. The key/combination to this lock will
be provided to all employees. Nonprofit Organization’s blank check stock shall be stored ina fireproof file cabinet of the Administrative Assistant’s Office. This cabinet will be lockedwith a key that is kept in the Administrative Assistant’s Office. Access to this file cabinet
shall be by keys in the possession of the Administrative Assistant and Executive Director.
Access to Electronically Stored Accounting Data
It is the policy of MHAGC to utilize passwords to restrict access to accounting softwareand data. Only duly authorized accounting personnel with data input responsibilities will beassigned passwords that allow access to the system.
Accounting personnel are expected to keep their passwords secret and to change theirpasswords on a regular basis, no less frequently than quarterly. Administration of passwords
shall be performed by a responsible individual independent of programming functions.
Each password enables a user to gain access to only those software and data files necessaryfor each employee's required duties.

Record Retention
It is the policy of MHAGC to retain records as required by law and to destroy them whenappropriate. The destruction of records must be approved by the Executive Director, andlogged into the Organization’s Destroyed Records Log. The formal records retention policyof Example NPO is as follows:
Accounts payable ledgers and schedules
Accounts receivable ledgers and schedules
Audit reports
Bank reconciliations
Bank Statements
Chart of Accounts
Cancelled Checks

7 Years
7 Years
Permanently
2 Years
3 Years
Permanently
7 Years
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Contracts, mortgages, notes, and leases (expired)
Correspondence:
General (Customers, Vendors, etc.)
Legal and important matters only
Deeds, mortgages, and bills of sale
Determination letter for income tax exemption
Depreciation schedules
Duplicate deposit slips
Employment applications
Expense analyses/expense distribution scheduleFinancial statements:
Year end
Other
General ledgers/year end trial balance
Insurance policies (expired)
Insurance records (policies, claims, etc.)
Internal audit reports
Internal reports
Invoices (to customers, from vendors)
Minute books of directors, bylaws and charters
Notes receivable ledgers and schedules
Payroll records and summaries
Personnel records (terminated)
Property records (incl. depreciation schedules)
Purchase orders:
Purchasing department copy
Other copies
Retirement and pension records
Tax returns and worksheets, examination reports
and other documents relating to IRS determination
Time sheets/cards
Trademark registrations and copyrights
Training manuals
Withholding tax statements

7 Years
2 Years
Permanently
Permanently
Permanently
Permanently
2 Years
3 Years
7 Years
Permanently
Optional
Permanently
3 Years
Permanently
3 Years
3 Years
7 Years
Permanently
7 Years
7 Years
7 Years
Permanently
7 Years
1 Year
Permanently
Permanently
7 Years
Permanently
Permanently
7 Years

Cash Receipts and Revenue Processing
Processing of Checks and Cash Received in the Mail
For funds that are received directly, cash receipts are centralized to ensure that cash received
is appropriately directed, recorded and deposited on a timely basis. Mail is opened and alisting of cash/checks received shall be prepared by the development director for all
contributions. The development director will enter this information into the fundraising
software. A deposit slip is prepared by the administrative assistant from the cash/checks
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received. Deposits are prepared and taken to the bank by the administrative assistant.
Administrative assistant enters the cash receipts into accounting system.
Endorsement of Checks
It is the policy of MHAGC that all checks received that are payable to
MHAGC shall immediately be restrictively endorsed. The restrictive endorsement shall be arubber stamp that includes the following information (if no stamp write the following):
1.
2.
3.
4.

For Deposit Only
Nonprofit Organization
The bank name
The bank account number of MHAGC

Timeliness of Bank Deposits
It is the policy of MHAGC that bank deposits will be made twice per week, unless thetotal amount received for deposit is more than $5,000. In no event shall deposits be madeless frequently than weekly.
Bank Reconciliation
The Executive Director looks at the bank statements and reconciliation statement eachmonth after it’s prepared by the accountant.
Credit Card Processing
MHAGC accepts MasterCard and Visa and credit cards for payment, all of which areauthorized through the participating credit card company. This is done by following thecredit card authorization instructions from the participating credit card company.
For all credit card payments, MHAGC will document the following information:
1.
2.
3.

Customer/Organization name, address and phone number
Name of credit cardholder
Address of cardholder

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Cash Disbursements and Accounts Payable
MHAGC processes the following three types of disbursements:
1) Repetitive (e.g. utilities)
2) Purchase orders
3) Check requests
Use of Purchase Orders
If Mhagc utilizes a purchase order for a purchase, a properly completed purchase ordershall be required for each purchase decision (i.e. total amount of goods and services
purchased, not unit cost), with the exception of travel advances and expense reimbursements,
which require the preparation of a separate form described elsewhere in this manual.
A properly completed Purchase Order shall contain the following information, at aminimum:
1.
Specifications or statement of services required2.
Vendor name, address, point of contact and phone number
3.
Source of funding (if applicable)
4.
Delivery or performance schedules
5.
Delivery, packing and transportation requirements
6.
Special conditions (if applicable)
7.
Catalog number, page number, etc. (if applicable)
8.
Net price per unit, less discount, if any
9.
Total amount of order
10.
Authorized signature
11.
Date PO prepared
Purchase orders shall be pre-numbered, kept in a secure area in the accounting department,
and issued upon request from an authorized purchaser. All purchase orders shall be recorded
in a purchase order log.
Use of Check Requests
All checks require an actual signature of the the President/CEO
The policy and procedures for processing invoices and accounts payables is as follows:
1) When the Administrative Secretary opens the mail, the invoices are placed in theaccounting inbox.
2) The CPA enters invoices and matches with any associated purchase orders into theaccounting system.
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3) Whenever possible, MHAGC will pay invoices within the specified deadlines required totake advantage of payment discounts.
4) The Administrative Assistant will prepare payments weekly or as needed. At no time will
checks be drawn to “cash” or “bearer.”
5) Payments will not be made unless proper documentation is secured (i.e., invoices, receipts
and purchase orders.)
6) The Administrative Assistant merges and staples the checks, copy of checks and invoice
detail together
7) The Administrative Assistant forwards the assembled accounts payable checks on to the
Executive Director for signatures.
8) Checks are signed and the Administrative Assistant breaks down the stapled check packs
and mails the checks. The copy of the check and invoice detail is then filed away inthe administrative office.

Travel Expense Reimbursement
These items listed below set forth the acceptable expenditure guidelines as well as reimbursement
procedures for business travel and travel related expenses:
1) A travel voucher form must be used to document all travel and travel related expenses.
Such expenses may include, but are not limited, to the following mileage, parking, tolls andmeals. The form will also serve as a request for reimbursement.
2) Receipts must be attached to the voucher. The must approve any voucher submitted
without receipts.
3) The travel voucher must contain the following information: date, location visited, mileage,
purpose of the travel and the cost of any other travel related expenses.
4) The program benefiting from the travel must be indicated. If the costs pertain to more than
one program, the total for each program must be indicated.
5) When attending conferences requiring overnight travel, the per diem meals allowance. Anyvoucher containing meal expenses greater than this must be signed by the Executive
Director.
6) Vouchers must be submitted to the Administrative Assistant by the fifth working day after
travel has occurred.
7) Generally, mileage to and from the work site will NOT be reimbursed.
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8) Trips to work in excess of five round trips per week are reimbursed if the travel is due to a
specific emergency call and the employee is not compensated for on-call service. Staff will
be reimbursed for mileage due to working additional shifts that are caused from staff
shortages.
9) Mileage in excess of normal commuting miles due to employer-directed conferences or
special meetings may be submitted may be submitted for reimbursement.
10) Questions about unusual or unique travel should be directed to the immediate supervisor
11) The rate of mileage reimbursement will be at standard IRS reimbursement rate per mile.
The Administrative Assistant will verify the rate. Rate changes shall be established by theGovernance Committee.
12) Travel checks will not be written for amounts less than $5.00. Vouchers will held until thereimbursement due is $5.00 or greater. This rule will not apply to terminated employees.

Payroll and Human Resources
Classification of Workers as Independent Contractors or Employees
It is the policy of MHAGC to consider all relevant facts and circumstances regarding therelationship between MHAGC and the individual in making determinations about theclassification of workers as independent contractors or employees. This determination isbased on the degree of control and independence associated with the relationship between
MHAGC and the individual. Other considerations would include ability to provide
insurance coverage’s for liability reasons. Facts that provide evidence of the degree ofcontrol and independence fall into three categories:
1.
2.
3.

Behavioral control
Financial control
The type of relationship of the parties

Facts associated with each of these categories that will be considered MHAGC
in making employee/contractor determinations shall include:
1.

Behavioral control:a.

Instructions given by MHAGC to the worker that indicate control over
the worker (suggesting an employee relationship), such as:
(1)
(2)
(3)

When and where to work
What tools or equipment to use
What workers to hire or to assist with the work
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(4)
(5)
(6)
b.

2.

3.

Where to purchase supplies and services
What work must be performed by a specified individual
What order or sequence to follow

Training provided by MHAGC to the worker (i.e. employees
typically are trained by their employer, whereas contractors typically provide
their own training)

Financial control:a.

The extent to which the worker has unreimbursed business expenses (i.e.
employees are more likely to be fully reimbursed for their expenses than is acontractor)b.

The extent of the worker’s investment in the facilities/assets used inperforming services for MHAGC (greater investment associated with
contractors)c.

The extent to which the worker makes services available to the relevantmarketd.

How MHAGC pays the worker (i.e. guaranteed regular wage for employees
vs. flat fee paid to some contractors)e.

The extent to which the worker can realize a profit or loss.

Type of Relationship:a.

Written contracts describing the relationship that MHAGC and the individual
intend to createb.

Whether MHAGC provides the worker with employee-type benefits, such as
insurance, paid leave, etc.

c.

The permanency of the relationshipd.

The extent to which services performed by the worker are a key aspect of theregular business of MHAGC

If an individual qualifies for independent contractor status, the individual will be sent a Form
1099 if total compensation paid to that individual for any calendar year, on the cash basis, is$600 or more. The amount reported on a Form 1099 is equal to the compensation paid tothat person during a calendar year (on the cash basis). Excluded from “compensation” are13

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reimbursements of business expenses that have been accounted for by the contractor by
supplying receipts and business explanations.
If an individual qualifies as an employee, a personnel file will be created for that individual
and all documentation required by the Youth personnel policies shall be obtained. The
policies described in the remainder of this section shall apply to all workers classified as
employees.
Payroll Administration
Mental Health Association of Greater Chicago
MHAGC operates on a semi-monthly payroll. A personnel file is established andmaintained with current documentation, as described throughout this section and more fully
described in Nonprofit Organization's Personnel Manual.
The following forms, documents and information shall be obtained and included in the
personnel files of all new employees:
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.

Employment Application (and resume, if applicable)
Applicant references (work & personal)Interview questions and notes
Form W-4 Employee Federal Withholding Certificate
State Withholding Certificate
Form I-9 Employment Eligibility Verification
Copy of driver’s license
Copy of Social Security card issued by the Social Security Administration
Starting date and scheduled hours
Job title and starting salary
Authorization for direct deposit of paycheck, with a voided check or deposit slip

For employees without a current, valid driver’s license, acceptable alternative documents
shall include:
1.
2.
3.
4.
5.
6.

U.S. Passport
Certificate of U.S. Citizenship (INS Form N-560 or N-561)
Voter’s registration card
U.S. Military card
ID card issued by a federal, state or local government, provided it contains a photo
School record or report card (for persons under age 18 only)

For employees without a Social Security card, acceptable alternative documents shall include:
1.
2.

U.S. Passport
Certificate of U.S. Citizenship (INS Form N-560 or N-561)
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3.
4.
5.
6.
7.

Original or certified copy of a birth certificate issued by a state, county or municipal
authority
Certificate of Birth Abroad issued by the Department of State (Form FS-545 or
Form DS-1350)
U.S. Citizen ID Card (INS Form I-197)
Native American tribal document
ID Card for use of Resident Citizen in the United States (INS Form I-179)

Each employee payroll file shall also indicate whether the employee is exempt or nonexempt from the provisions of the Fair Labor Standards Act. New hires, terminations, andchanges in salaries or pay rates shall be authorized in writing by the executive director. The
executive director payroll changes are determined by the board of directors. Voluntary
payroll deductions and changes in income tax withholding status shall be authorized inwriting by the individual employee. Documentation of all changes in payroll data shall bemaintained in each employee’s personnel file.
Payroll Taxes
The CPA is responsible for ensuring all required tax forms are properly completed andsubmitted, and that all required taxes are withheld and paid. The Accounting Department
may utilize the services of an outside payroll service center for the processing of payroll, as
determined by the administrative assistant.
It is the policy of MHAGC to obtain an updated Form W-4 from each employee in Januaryof each year. Withholding of federal income taxes shall be based on the most current Form
W-4 prepared by each employee.
Preparation of Timesheets
Each MHAGC employee must submit to the CPA a signed and approved timesheet no later
than Friday by 12:00 noon for the check processing to occur the following Wednesday
following the close of each pay period. Timesheets shall be prepared in accordance with thefollowing guidelines:
1.
2.
3.
4.

Each timesheet shall reflect all hours worked during the pay period (time actuallyspent on the job performing assigned duties), whether compensated or not
Timesheets shall be prepared in ink
Errors shall be corrected by crossing through the incorrect entry, filling in thecorrect entry, and placing the employee’s initials next to the change (i.e. employees
shall not use “white out” or correction tape)
Employees shall identify and record hours worked based on the nature of the work
performed;
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5.
6.

Compensated absences (vacation, holiday, sick leave, etc.) should be clearly identified
as such;Timesheets shall be signed by the employee prior to submission.

After preparation, timesheets shall be approved by Executive Directors or their designees,
prior to submission to the administrative assistant. Corrections identified by an employee’s
supervisor (Department Director) shall be authorized by the employee by placing theemployee’s initials next to the change.
An MHAGC employee who is on leave, on travel, or is ill on the day that timesheets aredue may telephone or e-mail timesheet information to his or her supervisor (or designatedalternate). Time so submitted must reflect the actual time worked and the appropriateclassifications. The employee must initial a timesheet submitted in this manner immediately
upon his/her return to the office. Timesheets submitted in this manner shall bear thenotation, "Time reported by telephone or e-mail by (employee) to (supervisor or designatedalternate)." The timesheet shall be signed by the supervisor or the designated alternate.
Upon return of all payroll reports and checks, the Executive Director reviews payroll upon
return from payroll company.

Net Asset Classifications
All income received by MHAGC is classified as "unrestricted", with the exception of thefollowing:
1.
2.

Grants and other awards received from government agencies or other grantors,
which are classified as temporarily restricted
Special endowments received from donors requesting that these funds bepermanently restricted for specific purposes

From time to time, MHAGC may raise other forms of contribution income which carrystipulations that MHAGC utilize the funds for a specific purpose or within a specified time
period identified by the donor of the funds. When this form of contribution income isreceived, MHAGC shall classify this income as Temporarily Restricted income.
As with all Temporarily Restricted net assets, when the restriction associated with acontribution has been met (due to the passing of time or the use of the resource for the
purpose designated by the donor). The Temporarily Restricted net assets keep track of the
grant or contribution balance and are reduced to zero as assets are released from restriction.

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Notes Payable
It is the policy of MHAGC to maintain a schedule of all notes payable, mortgage
obligations, lines of credit, and other financing arrangements. This schedule shall be basedon the underlying loan documents and shall include all of the following information:
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.

Name and address of lender
Date of agreement or renewal/extension
Total amount of debt or available credit
Amounts and dates borrowed
Description of collateral, if any
Interest rate
Repayment terms
Maturity date
Address to which payments should be sent
Contact person at lenderAn amortization schedule shall be maintained for each note payable. Based upon theamortization schedule, the principal portion of payments due with the next year shall beclassified as a current liability in the statement of financial position. The principal portion of
payments due beyond one year shall be classified as long-term/non-current liabilities in thestatement of financial position. Demand notes and any other notes without established
repayment dates shall always be classified as current liabilities. Unpaid interest expense shallbe accrued as a liability at the end of each accounting period.
A detailed record of all principal and interest payments made over the entire term shall bemaintained with respect to each note payable. Periodically, the amounts reflected as current
and long-term notes payable per the general ledger shall be reconciled to these payment
schedules and the amortization schedules, if any, provided by the lender. All differences shallbe investigated.

Board Conflict of Interest Policy
Objective
Effective non-profit governance depends on deliberate, thoughtful, and fair decision making
by Board members. The ability to make good decisions is sometimes affected by otherinterests - personal or professional - of individual Board and committee members. One
cannot eliminate conflicts of interest - they are a regular part of organizational and personal
life. The objective of this policy is to permit MHAGC to manage potential conflicts ofinterest successfully, when they do occur, in regards to Board and committee
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members.
Definition
A conflict of interest arises when a person able to influence a decision, whether by official
vote or moral and/or intellectual persuasion, is liable to gain:o Some personal advantage from the outcome of the decision in which they are
involved, and/or some advantage for an organization with which the individual is
directly involved.
o A conflict of interest also arises when as individual Board or committee members
outside duties, interests or obligations may or do differ fundamentally from his/her
obligations as a member of the Board, a committee or working group of Nonprofit
Organization.
Assumptions
1. No Board or committee member shall use his or her position, or the knowledge gained
there from, in such a manner that a conflict between the interest of MHAGC or any of
its affiliates and his or her interests arises, but is not disclosed.
2. When functioning as a MHAGC Board or committee member, each person has a duty toplace the interest of MHAGC foremost in any dealings with MHAGC and has acontinuing responsibility to comply with the requirements of this policy.
3. Board and committee members are not eligible for employment or service contracts with
MHAGC or its affiliates during their tenure. If a Board or committee member wishes toapply for a permanent position at MHAGC, he/she must immediately withdraw from
active participation on the Board or committee. If the Board or committee member isthe successful candidate, he/she must resign from the Board or committee upon
accepting the position.
4. Any Board or committee member who becomes aware of a potential conflict of interest
with respect to any matter coming before the Board, committee, or working group shallmake this potential conflict known immediately in any discussion relating to the matter.
5. Decisions taken by the Board, committees or working groups, regarding the managementof a conflict of interest, must not only be fair, they must be seen to be fair.
Procedure
When an actual, perceived, or potential conflict is identified by any person, the following
action must be taken:
1. The Board or committee member identifies the actual, perceived or potential conflict;
2. The Board or committee member must fully disclose the conflict to the Chairperson
and, where appropriate, to all Board or committee members;
3. The Chairperson shall develop an appropriate response, including where necessary,disqualification from voting and discussion and any necessary remedial action. For
example, if a vote may have been affected by a previously undeclared conflict of interest,
it may be necessary to hold that vote again.
4. Where a potential conflict of interest is identified, the following options may be
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considered and combined as appropriate:o The Board or committee member with the conflict should not be involved in any
aspect of the decision making process.
o He or she may be present and/or participate in discussions but refrain from voting.
o He or she will absent him or herself from any discussions in connection with thematter in question.
o He or she may participate in initial discussions and then be asked to leave for further
discussions before the vote.
o He or she may vote or be present for the vote, but the vote will be done byconfidential balloto He or she may participate fully.
The Board, committee or working group must agree in majority on the option or
combination of options to be taken in any given conflict of interest situation.
5. Any Board or committee member may ask for a decision to be taken by secret ballot
when dealing with a matter where there is a conflict of interest.
6. The official minutes of the meeting must record the potential conflict of interest andhow it was avoided and/or dealt with.
7. When there is a failure to agree on whether a conflict of interest exists and/or how it is
to be managed, the Chairperson (or if the potential conflict of interest involves him orher, the vice-chairperson) may seek legal counsel.
Common Sense Provision
The application of any part of this policy shall rely heavily on the common sense of thegroup as a whole. Conflict of interest circumstances vary and the judgment and flexibility of
the Board, committee, or working group must be preserved.
ExamplesSome examples of situations which may indicate a conflict of interest are:o Where a Board or committee member is in a position to influence the creation of
employment or a service contract and then becomes a candidate for such a position
or contract.
o Where a member of the Board or committee influences the selection of a supplier ofgoods and\or services and the member has an ownership interest in that supplier.
o Where a Board or committee member uses MHAGC’ name and resources for
personal benefit.
o Where a Board or committee member could influence the giving of a grant, funds or
project approval which would benefit themselves or an organization they areassociated with as staff or volunteers.

Whistleblower Policy
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Code of Ethics and Conduct (“Code”) requires directors, officers and employees to observehigh standards of business and personal ethics in the conduct of their duties andresponsibilities. As employees and representatives of MHAGC, we must practice honesty
and integrity in fulfilling our responsibilities and comply with all applicable laws andregulations.
Reporting Responsibility
It is the responsibility of all directors, officers and employees to comply with the Code andto report violations or suspected violations in accordance with this Whistleblower Policy.
No Retaliation
No director, officer or employee who in good faith reports a violation of the Code shallsuffer harassment, retaliation or adverse employment consequence. An employee who
retaliates against someone who has reported a violation in good faith is subject to discipline
up to and including termination of employment. This Whistleblower Policy is intended toencourage and enable employees and others to raise serious concerns within MHAGC prior
to seeking resolution outside MHAGC.
Reporting Violations
The Code addresses MHAGC's open door policy and suggests that employees share theirquestions, concerns, suggestions or complaints with someone who can address themproperly. In most cases, an employee’s supervisor is in the best position to address an area ofconcern. However, if you are not comfortable speaking with your supervisor or you are notsatisfied with your supervisor’s response, you are encouraged to speak with someone inmanagement whom you are comfortable in approaching. Supervisors and managers are
required to report suspected violations of the Code of Conduct to the MHAGC's Chairmanof the Board of Directors, who has specific and exclusive responsibility to investigate allreported violations. For suspected fraud, or when you are not satisfied or uncomfortablewith following the MHAGC's open door policy, individuals should contact the Chairman of
the Board of Directors directly.

Compliance Officer
MHAGC's Chairman of the Board of Directors is responsible for investigating and resolving
all reported complaints and allegations concerning violations of the Code and, at his
discretion, shall advise the Executive Director and/or the audit committee. The Chairman
has direct access to the audit committee of the board of directors and is required to report tothe audit committee at least annually on compliance activity. MHAGC's Chairman will workwith the Treasurer who is the chair of the audit committee to address such issues.
Accounting and Auditing Matters
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The audit committee of the board of directors shall address all reported concerns orcomplaints regarding corporate accounting practices, internal controls or auditing. The
Treasurer of MHAGC shall immediately notify the audit committee of any such complaint
and work with the committee until the matter is resolved.
Acting in Good Faith
Anyone filing a complaint concerning a violation or suspected violation of the Code must be
acting in good faith and have reasonable grounds for believing the information disclosed
indicates a violation of the Code. Any allegations that prove not to be substantiated andwhich prove to have been made maliciously or knowingly to be false will be viewed as aserious disciplinary offense.
Confidentiality
Violations or suspected violations may be submitted on a confidential basis by thecomplainant or may be submitted anonymously. Reports of violations or suspectedviolations will be kept confidential to the extent possible, consistent with the need to
conduct an adequate investigation.
Handling of Reported Violations
The Treasurer will notify the sender and acknowledge receipt of the reported violation orsuspected violation within five business days. All reports will be promptly investigated andappropriate corrective action will be taken if warranted by the investigation.

Code of Conduct
The recent state of business scandals has focused attention on the importance of welldeveloped and communicated code of conduct in promoting a culture of honesty and ethicalbehavior and deterring unethical business activity. To be effective, a code of conduct must
be well communicated to, and understood by, those expected to adhere to it. The code of
conduct should be presented to Agency personnel and conduct periodic training sessions toensure that they remain aware of the code and understand its implications for their behavior.
The Mental Health Association of Greater Chicago is committed to the highest
possible ethical standards and we encourage everyone associated with MHAGC
to commit to acting in the best interest of MHAGC and its mission.
Our mission demands that we, Board and Committee Members, staff andvolunteers, as stewards of our mission, uphold the public trust and act in an
ethical manner in all that we do in the name of MHAGC. These ethical values
include integrity, openness, honesty, accountability, fairness, respect andresponsibility. These values are the basis of our Code of Conduct andcommitment to act in a manner befitting MHAGC and mission.
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As a public charity, we rely on the public for funding and volunteer support,
which is critical to the success of our mission? The public trusts us to carry out
our stated mission and to act in the best interest of MHAGV. If we abuse thepublic trust, our ability to fulfill our mission is severely weakened. Therefore, it
is critical that we operate in a manner that is above reproach in all aspects,
including governance, fundraising, mission operations, legal matters and humanresources.
As a public charity we are committed to:• Acting responsibly and with integrity;• Following not just the letter of the law, but the spirit of the law as well;• Promoting financial accountability, transparency, and best governancepractices;• Respecting the wide variety of people who support our mission throughdonations of their time, talent and money;• Being responsible stewards of MHAGC, its mission, reputation andresources;• Being open and honest in all of our dealings with both internal andexternal audiences.
This Code of Conduct applies to all staff members, the Board of Directors andCommittee Members, and volunteers.
Accountability and Responsibility
All staff, Board and Committee members, and volunteers will:• Be open and honest with colleagues, stakeholders, volunteers, donors,
and all others involved in MHAGC;• Abide by the by-laws and policies of MHAGC.
• Take responsibility for their actions, and care in their dealings as
representatives of MHAGC;• Exercise best governance and accounting practices and procedures;• Use the resources of MHAGC in a responsible and wise manner;• Promote financial transparency while working to fulfill the mission of
MHAGC.
All who serve in a position of authority over MHAGC will:• Place MHAGC above other interests, financial or otherwise;• Act in the best interest of MHAGC;• Disclose any actual or perceived conflict of interest.
Professional Excellence
All members of our staff, Board of Directors, Committees and allvolunteers will:
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• Act in a responsible, ethical manner that promotes openness, fairness andintegrity;• Treat people with dignity and respect;• Work together to achieve our mission to the best of our ability.
MHAGC is an equal opportunity employer and does not discriminate on thebasis of race, color, religion, gender, sexual orientation or identity or national
origin. We value the diversity of all people.

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