EXAMPLE
•Charity X has a 25 member board. One of the directors, Carter,
was previously employed as the manager of another charity, Charity Y,
in 2001-2002
•Charity Y is audited in 2004 in respect of the 2001 and 2002
taxation years. Charity Y loses its status in February 2006 for
substantial non-compliance, as a result of the imprudent
actions of Charity Y’s board of directors, actions which
Carter strongly objected to and which ultimately caused
Carter to resign in 2002
•Because Carter managed a charity that lost its status for
substantial non-compliance, Carter is an ineligible individual
for the period of 5 years from the date of revocation in February 2006
to February 2010
•Charity X’s charitable status could now potentially be revoked
because an ineligible individual on its board
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