Accountability Matters - US White Paper
Thursday, 28th July 2005 at 1:07 pm
That’s the view of a new White Paper discussion called Accountability Matters by Blackbaud – a leading US-based global provider of software and services designed specifically for Not for Profit organisations.
Produced by Blackbaud’s Liz Marenakos the White Paper looks at accountability and examples in the US but the process of being more accountable and transparent relate well to the Australian sector.
Liz Marenakos is the product manager for Blackbaud’s financial management and data analysis solutions. She has served on the boards of several Not for Profits, in roles ranging from treasurer to vice president. She has also served as the financial manager of a NFP managing several fundraising events and participating in capital campaigns. Marenakos holds a BS in international politics from Georgetown University, a Master of Accountancy degree from The University of Charleston, and is currently enrolled in the MBA program.
The White Paper describes the steps that Not for Profits can take to make their financial processes more effective and their activities more transparent based on the ‘four principles of accountability’ from US financial consultancy Grant Thornton.
– Systems (procedures and technologies, including internal controls and smart software that produce predictable results)
– Oversight (including financial reporting and solid governance structures)
– Culture (an intangible quality that reflects the values of the organisation)
– Knowledge (professional financial expertise, along with a well-trained board and staff)
The White Paper suggests that while “SOCK” is a good way to think about accountability, in practical terms Not for Profits have to translate these principles into actionable items. These include:
– Establishing an audit committee
– Ensuring auditor communications with the board
– Defining organisational policies and monitoring compliance
– Reporting finances
– Establishing internal controls
– Providing for whistle blowers
– Public disclosure
The White paper says that every Not for Profit should have in place a governance structure and strict financial controls in order to assure stakeholders that every dollar invested in their organisation is well spent.
NFPs should also put in place technology to help them to be accountable and to communicate with donors about how their gifts are being used to carry out the their mission.
Equally important, the White Paper says is that stewardship requires that today’s Not for Profit management invests assets wisely and reasonably for the long term so that those charged with carrying out the mission in the future have access to the same level of financial resources.
It concludes that good stewardship implies that an organisation is using donated dollars wisely. A NFP that demonstrates such accountability is responding to those who have invested their trust, faith, and money in that organisation.
For more information on this White Paper or to download it in its entirety, please visit http://www.blackbaud.com/resources/white-papers.aspx#Financial