You make it sound like your director is an entrepreneur running an event from which she gives the profit to you.  It raises major questions. Are the participants eligible to claim any charitable contribution deduction since the charity does not get the money directly?  Is she registered to solicit on your behalf?  Who is responsible if a golfer slices a drive into a crowd and beans a spectator?  Or someone drinks too much and has an accident on the way home?  Does anyone carry insurance (because you are sure to be sued if there is an injury)?  What happens if she makes only $5 a participant, or loses $5 a participant?  How do you know what she actually makes or doesn’t make?  Does she report the revenue from the event on her personal income tax return?

You can eliminate or answer most of these questions more easily if she runs the event as the charity’s agent.  You could set her up with a separate bank account specifically for the purpose.  She could receipt all payments to the charity and pay all the costs of the event.   Presumably, you are registered to solicit if required.  Donors could claim a charitable contribution deduction for the difference between what they pay and the value of what they get in return, without regard to other costs that reduce the net to the charity.  You could cover risks with your own insurance.  You might be able to provide some guidance, assistance and perhaps even some control while she functions as the host on your behalf.  As a charity, you may be able to get permits for lotteries or liquor that she could not legally obtain on her own.  And ultimately, you can report on the finances as you would if you ran it entirely on your own.  (See Ready Reference Page: Form 990 Reporting for Special Events Can Be Tricky –And Is Often Wrong”) It may be delicate to get her to agree to a new structure, but if she understands the risks of doing it entirely her way, she might be amenable to the clarity.