This question essentially raises three questions. First, the person who keeps the books does not have to be the Treasurer of the organization. The actual job can be done by anyone, without the title or final responsibility. It could be done by an officer, employee, volunteer, or independent contractor. It would make sense to formalize the understanding if she is going to continue to do the books.

 

Second, insurance coverage depends upon the policy, but most general liability and D & O policies cover officers, directors, employees and usually volunteers. If she is acting as an independent contractor she might want her own insurance.

 

Third, you should check the state nonprofit corporation law to be sure that the Treasurer does not have to be a member of the Board, but I am not aware of any state law that requires it. The bylaws normally determine whether the Treasurer has to be a member of the Board. Even if the bylaws do not require it, most nonprofits in my experience have designated a Board member as the Treasurer.