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Articles
BOARD ISSUES AND ACCOUNTABILITY
Best Practices for Not-for-Profit Accountability
Last month’s ADO Insider featured an article by Arli Epton on Sarbanes-Oxley and the Consumer Confidence Crisis in Nonprofit Governance, from a presentation by Robin Ganzert, Ph.D., Senior Vice President and Managing Director of the Wachovia National Center for Planned Giving, at the Planned Giving Group of Greater New York meeting in January of this year.
The following is Dr. Ganzert’s list of best practices:
- Provide 990s in an easily available format.
- Publish annual reports with financial data.
- Rely on annual independent audits to assist with oversight of accounting and financial operations.
- Provide for certification of financial statements.
- Create an audit committee on the board.
- Create and enforce necessary policies, including those pertaining to whistle blowers and document destruction.
- Avoid and manage conflicts of interest.
- Know the federal and state regulations, including awareness of pending legislation on nonprofit governance.
- Keep good records in all functional areas.
- Maintain good accounting systems and internal controls.
- Educate boards on fiduciary and oversight obligations.
Obviously these recommendations will wind up being mediated by the size and culture of the organization considering them. However, the livelihood of all development officers is based on the implicit trust that donors have in a charitable organization’s mission, vision, and leadership. When that implicit trust is developed through ethical standards and behavior, donor cultivation is easier. Quite simply, enacting the spirit of Sarbanes-Oxley ensures that donor stewardship and the implicit trust in nonprofits remains strong.
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