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Nonprofit organizations rise and fall on their reputations. CPA firms working with nonprofits need to understand how to ensure their clients are doing everything they can to safeguard the public trust. This presentation was given at the Massachusetts Society of CPA's Nonprofit Conference in January, 2013. It explains why accountability matters, defines accountability while providing a test for nonprofit organizations to learn their "accountability IQ", and includes nine ways to improve accountability. Whether your a nonprofit organization or a finance professional who works with nonprofits, accountability matters. Download this presentation to learn why, and what you can do to earn and maintain it.
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Leveraging Accountability Jeff Sobers, Product Marketing Manager
Blackbaud, Inc. @JeffSobers
AGENDA Why does accountability matter? Understand, measure and improve Nine ways to improve accountability
Why does ACCOUNTABILITY
matter?
1. Fraud and fiscal mismanagement 2. Need growing faster than funding 3. Donors expect more than ever
ACCOUNTABILITY MATTERS
FRAUD 1
LOSS OF MAJOR DONORS
BOARD MEMBERS FORCED TO RESIGN
FORCED TO PAY DAMAGES
DEMAND 2 OUTPACING
FUNDING
What do you expect to happen to demand for your
services in 2013?
INCREASE SIGNIFICANTLY
What do you expect to happen to demand for your
services in 2013?
INCREASE SLIGHTLY
What do you expect to happen to demand for your
services in 2013?
STAY THE SAME
What do you expect to happen to demand for your
services in 2013?
DECREASE
31%
42%
21%
5%
35% 36%
20%
10%
41% 36%
16%
7%
44% 41%
12%
4%
SignificantlyIncreased
SlightlyIncreased
Stayed theSame
Decreased
DEMAND FOR SERVICES 2008 2009 2010 2011
Source: 2012 Nonprofit Finance Fund
Do you expect to be able to meet all of the demand for
your services in 2013?
56% 51% 52% 50%
44% 49% 48% 50%
2009 2010 2011 2012
Were Nonprofits Able to Meet Demand for Services?
YesNo
3 DONORS DEMAND
TRANSPARANCY
INFORMATION IS AVAILABLE LIKE NEVER BEFORE
WHERE DID THE MONEY GO?
Do you think the nonprofit sector is on the right track or has seriously gotten off
in the wrong direction?
30%
32%
38%
OVERALL
Right TrackWrong DirectionNot Sure
Source: 2010 Harris Poll
36% 38% 35% 33%
29%
21% 16%
19% 23%
34% 38% 37%
48% 43% 42%
33% 33%
42%
18 - 24 25 - 29 30 - 39 40 - 49 50 - 64 65+
BY AGE GROUP
Right Track Wrong Direction Not Sure
RECAP: 1. Fraud and fiscal mismanagement 2. Need growing faster than funding 3. Donors expect more than ever
What’s a nonprofit
to do?
Understand, measure,
and improve
What is ACCOUNTABILITY?
WITHOUT PUBLIC TRUST
NONPROFITS WOULDN’T EXIST
ACCOUNTABILITY versus
STEWARDSHIP
WHAT IS YOUR ACCOUNTABILITY IQ?
Does the organization hold staff and board meetings on ethics or take other measures to foster a
culture of accountability and transparency?
Does the organization have a code of ethics and
statement of values and post it on your website?
Does the organization follow a conflict of interest policy and post it on the
website?
Does the organization have board members with financial expertise?
Does the organization have its financial statements independently audited?
Does the organization take steps to remain current with
the law?
Does the organization have board members review financial statements,
including the Form 990?
Does the organization have the CEO or CFO sign the
Form 990?
Does the organization file the Form 990 electronically?
Does the organization post the Form 990 on your
website?
Does the organization post the policies, financial
information, and information on programs results on the website?
Does the organization have a supported policy on reporting suspected
misconduct (a whistleblower policy)?
SCORING SCORE WHAT IT MEANS 12 Great, keep up the good work and pass along
your success stories and model policies for others to learn
9 – 11 Good, but there’s room for improvement 6 – 8 You’ve indicated commitment to accountability,
but need to move beyond the basics 0 – 5 Time to get serious about accountability. Engage
your Board, staff and volunteers quickly to help make the needed changes.
Didn’t get the score you expected?
9 WAYS TO
IMPROVE ACCOUNTABILITY
1 Create a culture of transparency
2 Create a donor Bill of Rights
http://www.afpnet.org/files/ContentDocuments/Donor_Bill_of_Rights.pdf
3 Adopt a conflict of interest policy
4 Ensure the Board of Directors can fulfill its fiscal responsibility
5 Conduct independent financial reviews and audits
6 Ensure the accuracy of the Form 990 and make it public
7 Be transparent
external stakeholders with
8 Establish and
support a policy of reporting
suspected misconduct
9 Remain current
with the law
REVIEW: 1. Create a culture of transparency 2. Create a Donor Bill of Rights 3. Adopt a conflict of interest policy 4. Ensure the Board can fulfill its fiscal
responsibility 5. Conduct independent audits 6. Ensure the 990 is accurate and public 7. Be transparent with stakeholders 8. Establish a whistleblower policy 9. Remain current with the law
What QUESTIONS do you have?
@JeffSobers
http://www.npengage.com/financial-management/
