Good accounting practices and engaged board help nonprofits avoid fraud

• Published date: 01 March 2017
• DOI: http://doi.org/10.1002/nba.30286
• Date: 01 March 2017

www.nonprofitbusinessadvisor.com © 2017 Wiley Periodicals, Inc., A Wiley Company • All rights reserved

View this newsletter online at wileyonlinelibrary.com

Email, iPhone & iPad delivery available. Call 800.835.6770 for information.

Also in this issue

Conferences & Events: Grant Managers Network Annual

Conference; Symposium on Women, Philanthropy and Civil

Society; Jewish Funders Network International Conference;

Hispanics in Philanthropy 2017 Leadership Conference .....4

Industry News: Education, advocacy and software

integrations seen as key trends to watch for associations ...5

Industry News: PayPal sees 11 percent growth in

donations for 2016 ........................................................6

Slow, reduced payments hurting nonprots ......................6

Nonprot Research: Donors, volunteers seeking

transparency and personalization ....................................7

Lilly Endowment awards $100 million for Indiana-

focused groups ...............................................................7

Resources: 4good.org webinar looks at engaging board

members; Foundation Center webinar gives intro on

fundraising planning; Foundation Center livestream

broadcast on impact investing ........................................9

Employment Law: Legal cases that impact nonprots .. 10

News: Briefs from around the sector .............................12

(See FRAUD on page 2)

Report: Charitable giving to grow

by nearly 4 percent in 2017, 2018

Charitable giving in the United States is predicted

to grow by 3.6 percent in 2017 and by an additional

3.8 percent in 2018, according to The Philanthropy

Outlook 2017 & 2018, a new report from the Indiana

University Lilly Family School of Philanthropy.

According to the school, the report generates

predictions for year-to-year growth rates in overall

giving; giving by type of donor; and giving to edu-

cation, health and public-society benet nonprot

organizations. Projected rates of change in the new

report use 2016 as the base year and are reported in

2015 ination-adjusted dollars.

Changes in total giving for the years 2017 and 2018

are predicted to exceed the most recent 10-year annual-

ized average increase in giving of 0.5 percent, but will

be below the most recent 25-year and 40-year annual-

ized averages, the report said. In general, increases in

the U.S. economy, as reected in the value of stocks,

gross domestic product and household income, will

lead to a rise in philanthropic giving in 2017 and 2018.

“The projections of The Philanthropy Outlook

point to some dramatic changes in American philan-

thropy,” said John Cash, chair of the board of direc-

tors of Marts & Lundy, which authored the report.

Contributions to donor-advised funds and to fam-

ily foundations will continue to grow signicantly,

leaving large amounts of charitable dollars waiting

for future distribution, Cash said.

“While the outlook is certainly good, the need for

vigorous and meaningful engagement on the part of

recipient organizations has never been greater,” he said.

For more information, visit https://philanthropy

.iupui.edu. ■

Good accounting practices and engaged board

help nonprots avoid fraud

“And having a board that looks at the nancials

and monitors them regularly is a big help as well.”

If it seems to you that nonprot nancial misman-

agement and outright fraud have been in the news

a lot lately, you’re not alone. Truth is, several high-

prole cases have hit the headlines over the last couple

years, and according to experts, many more have

occurred but were kept out of the news in an effort

to limit the reputational hit that often accompanies

disclosure that a charity’s nances and internal audit

controls have not been up to par—leaving potential

donors leery of further supporting the organization.

According to Adam Cole, co-leader of the Non-

profit & Education Practice at accounting firm

BDO, instituting some sound accounting and man-

agement practices and keeping the board informed

and engaged are the keys to avoiding both nancial

mismanagement and fraud.

“Good governance and hiring competent audi-

tors can avoid most of these problems,” Cole said.

Vol. 330 March 2017