Professional Standards & Ethics Flashcards
7 cards from real CED practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Professional Standards & Ethics flashcards as text
Which document most directly governs how a nonprofit must use restricted grant funds in alignment with donor intent?
Answer: The grant agreement or gift instrument
The grant agreement or gift instrument is the legally binding document that specifies how restricted funds must be used.
Professional ethics in nonprofit management require that an ED avoid using organizational information for personal benefit. This principle is best described as:
Answer: Duty of loyalty
The duty of loyalty prohibits self-dealing, including using privileged organizational information for personal financial advantage.
An organization's whistleblower policy should include which key protection?
Answer: Protection from retaliation for good-faith reports of suspected wrongdoing
The essential component of a whistleblower policy is protection from retaliation for employees who report suspected misconduct in good faith.
When an executive director recuses themselves from a board vote due to a conflict of interest, they should:
Answer: Leave the room before discussion begins and the vote occurs
Full recusal means leaving both the discussion and the vote to ensure the conflicted party does not influence the outcome in any way.
A grant-funded program is producing minimal impact data. The ED should ethically respond by:
Answer: Transparently communicating results to the funder and discussing program adjustments
Honest reporting to funders, even when outcomes are poor, maintains trust and allows for collaborative problem-solving rather than deceptive grant management.
Which body has primary authority to set and enforce compensation for the executive director of a nonprofit?
Answer: The full board of directors
The full board of directors has ultimate fiduciary responsibility for setting and approving executive compensation to ensure accountability.
The IRS 'rebuttable presumption' process for executive compensation requires nonprofits to do which of the following?
Answer: Use comparability data, independent approval, and concurrent documentation
The rebuttable presumption of reasonableness requires boards to use comparability data, obtain independent approval, and document the decision contemporaneously.