Strategies And Internal Control Procedures For Decreasing Fraud In Faith Based Nonprofit Organizations

This study addressed the problem regarding the lack of strategies and internal controls in faith-based nonprofit organizations which resulted in a higher risk of fraud, waste of funds, or abuse of funds in charities, churches, and other related ministries. This risk was the result of trust by organizations that employees would not commit fraud and due to a lack of sufficient resources. This study specifically researched faith-based nonprofit organizations that are located in Texas. This qualitative case study included two faith-based nonprofit organizations located in or near Houston, Texas. The research found several themes including: frauds occur, segregation of duties, approval controls, review process, and policies and procedures. The study also found several internal controls, policies, and procedures that these organizations could implement to decrease the risk of fraud, such as a whistleblower policy, background checks, segregation of duties, review of financials, and limited access to accounting procedures. Further research could be conducted on the implementation of internal controls after a fraud was discovered and the restoration of donor trust.

Essential tools and guidance for effective nonprofit financial management Financial Management for Nonprofit Organizations provides students, professionals, and board members with a comprehensive reference for the field. Identifying key objectives and exploring current practices, this book offers practical guidance on all major aspects of nonprofit financial management. As nonprofit organizations fall under ever-increasing scrutiny and accountability, this book provides the essential knowledge and tools professional need to maintain a strong financial management system while serving the organization’s stated mission. Financial management, cash flow, and financial sustainability are perennial issues, and this book highlights the concepts, skills, and tools that help organizations address those issues. Clear guidance on analytics, reporting, investing, risk management, and more comprise a singular reference that nonprofit finance and accounting professionals and board members should keep within arm’s reach. Updated to reflect the post-recession reality and outlook for nonprofits, this new edition includes new examples, expanded tax-exempt financing material, and recession analysis that informs strategy going forward. Articulate the proper primary financial objective, target liquidity, and how it ensures financial health and sustainability Understand nonprofit financial practices, processes, and objectives Manage your organization’s resources in the context of its mission Delve into smart investing and risk management best practices Manage liquidity, reporting, cash and operating budgets, debt and other liabilities, IP, legal risk, internal controls and more Craft appropriate financial policies Although the U.S. economy has recovered, recovery has not addressed the systemic and perpetual funding challenges nonprofits face year after year. Despite positive indicators, many organizations remain hampered by pursuit of the wrong primary financial objective, insufficient funding and a lack of investment in long-term sustainability; in this climate, financial managers must stay up-to-date with the latest tools, practices, and regulations in order to serve their organization’s interests. Financial Management for Nonprofit Organizations provides clear, in-depth reference and strategy for navigating the expanding financial management function.

Faith-Based Organizations have been attracting growing attention by governments and donors as worthy partners in developing economies. However, some financial improprieties and fraud have been witnessed calling into question the effectiveness of their internal controls(ICs). These controls are sometimes influenced by some religious doctrines. Earlier studies have been limited and focusing only on a narrow set of controls within FBOs. The present study, unlike earlier studies, adapted the COSO framework and conceptual model as a holistic approach to examine the ICs in twenty seven FBOs operating in Ghana. For that purpose, data were collected from several sources including internal officials (accountants, internal auditors, top management and board members) in addition to external stakeholders (donors and external auditors). The study concluded that weaknesses were identified in some IC components. In addition, some specific religious doctrines that impacted negatively or positively in these organizations were also identified. The study ends up with with recommendations to improve the ICS in the FBOs and pointing out areas for further research in the field.

IS YOUR BUSINESS VULNERABLE TO FRAUD? It's not a secret that corporate fraud and scandal are real threats to business today, from which no business, large or small, is immune. Fraud losses are devastating-but they are also highly avoidable. Policies & Procedures to Prevent Fraud and Embezzlement shows you how to proactively safeguard your business's assets and reputation from countless plots, schemes, and even identity theft. This invaluable tool prepares auditing CPAs, internal auditors, fraud investigators, and managers to: Thoroughly evaluate their organization's system of internal controls Assemble a fraud examination team Document a fraud action plan Expose weaknesses that could lead to fraud Take corrective action to reduce the possibility of victimization Embezzlement and fraud are realities that all organizations must confront, with the growing list of collapsed corporate giants serving as evidence of the destruction caused by financial abuses. Policies & Procedures to Prevent Fraud and Embezzlement offers provocative new strategies to deal with this ongoing dilemma and serves as a road map to reduce financial dishonesty in the workplace.

IS YOUR NONPROFIT VULNERABLE TO FRAUD? Fraud or embezzlement discovered within a major corporation ultimately leads to front-page scandals and a few raised eyebrows. But the mere suggestion or evidence of fraud within a nonprofit can cause irreversible damage to its reputation, its support base, and, eventually, its very existence. Preventing Fraud in Nonprofit Organizations is the proactive manual your organization needs to detect fraud and prevent it from affecting your organization's bottom line and name. Brimming with details of hundreds of actual fraud and embezzlement schemes, it provides specific, practical advice on strengthening the areas in which your nonprofit may be most vulnerable. This hands-on guide shows nonprofit accountants, CFOs, financial consultants, board members, and managers how to: * Know the four consistent areas of high risk * Thoroughly evaluate their organization's system of internal controls * Assemble a fraud examination team * Document a fraud action plan * Expose weaknesses that could lead to fraud * Take corrective action to reduce the possibility of victimization Fraud deterrence is not exclusive to large corporations. Recommended reading for nonprofit professionals, Preventing Fraud in Nonprofit Organizations will motivate executives to take a fresh and intensive look at their organization's practices and act to protect from financial dishonesty.

Completely revised and updated, this handbook provides internal control guidance and tools specifically for private and not-for-profit business entities.

How-to, authoritative guidance for creating a best-in-class fraud prevention and compliance program in any organization Now in a Second Edition, this practical book helps corporate executives and managers understand the full ramifications of good corporate governance and compliance. It covers best practices for establishing a unit to protect the financial integrity of a business; theories and models on how and why fraud occurs in an organization; importance of strong internal controls; major compliance and corporate governance initiatives and milestones since 1985; and more. Complete coverage includes implementation guidance for a robust fraud prevention and compliance program, including sample policies, best practice examples, and a 14-point management antifraud program. Covers fraud risk assessment and prevention guidance Looks at global risk issues, including the Foreign Corrupt Practices Act (FCPA) and UK Bribery Act Examines amendments to the Federal Sentencing Guidelines for Organizational Crime Discusses Dodd-Frank Whistleblower Provisions Explores enterprise risk management key program elements Offers coverage of how fraud and compliance failures contributed to the financial crisis Includes enhanced principles for fraud data mining Presents new cases, checklists and real-world examples, expanded international coverage, and the latest technological tools Shows executives and managers what their responsibilities are regarding fraud prevention, internal controls, and compliance Provides an instructor's website, including a test bank Other titles by Biegelman: Building a World-Class Compliance Program and Foreign Corrupt Practices Act Compliance Guidebook Completely revised and updated, Executive Roadmap to Fraud Prevention and Internal Control, Second Edition is every manager's best resource for understanding all the complex issues and responsibilities associated with fraud and compliance. Praise for Executive Roadmap to Fraud Prevention and Internal Control: Creating a Culture of Compliance "Martin Biegelman and Joel Bartow convert their lifelong experiences and unparalleled knowledge into a concise, well-written book. They provide the essential tools to take aspirational goals for fraud prevention and compliance and build them into concrete and effective programs." —From the Foreword by Bradley J. Bondi, Partner, Caldwater, Wickersham & Taft LLP "Executive Roadmap touches all the bases on corporate fraud. The authors – both experienced fraud investigators and federal law enforcement agents – lay out the history and major milestones of corporate fraud, and discuss with precision the key issues facing today’s executives and compliance leaders. The book provides a valuable overview for business leaders looking to develop and implement effective compliance programs and instill a culture of integrity in order to help their organizations defeat the challenges posed by today's sophisticated fraudsters." —Jeffrey Eglash, Senior Counsel, Litigation & Legal Policy, GE "Biegelman and Bartow provide great insight into not just how fraud occurs inside of companies, but why. Preventing fraud requires a solid understanding of both, making this book a must read for any executive who is serious about creating the compliance mechanisms and the corporate culture needed for effective fraud prevention." —Aaron G. Murphy, Partner, Latham & Watkins LLP "Business leaders would be wise to follow the recommendations in this book. Fraud prevention is more than just creating a set of policies. As the subtitle indicates, it is essential to create a culture of compliance. Empty words accomplish nothing. The authors, both experienced fraud examiners, have spent decades investigating fraud, as well as developing strategies to prevent it. This book is an essential tool in creating an anti-fraud environment in any company." —James D. Ratley, CFE, President & CEO, Association of Certified Fraud Examiners "Biegelman and Bartow's Executive Roadmap to Fraud Prevention and Internal Control is an essential guide for all who have an interest in eradicating corporate or institutional fraud. Written by experts in detecting and preventing fraud in its myriad forms, this book is a handy source for those who hope to avoid the predicaments that the authors have seen or in managing the crises that arise when the problems cannot be avoided. The new second edition is an indispensable addition to the libraries of internal compliance and legal officers, and forensic accountants." —Joel M. Cohen, Partner, Gibson Dunn & Crutcher, former New York federal prosecutor and liaison to the French Ministry of Justice and OECD "Biegelman & Bartow's book offers expert guidance to anyone tasked with understanding and tackling fraud in the workplace. Their straightforward approach informs the reader and provides a roadmap and guidance for implementation of an effective fraud mechanism within any organization – small or large. I plan to provide a copy of the book to my Board of Directors and executive members of management." —Lisanne E. S. Cottington, Compliance Officer, Insight Enterprises, Inc. "This next edition is extremely timely. It covers key topics that any management member needs to know in today’s regulatory climate. These authors have used their extensive corporate and government experience to create a practical and easy to understand compliance guide. A superb resource for any executive." —Karen Popp, Partner at Sidley Austin LLP and former federal prosecutor and Associate Counsel to President Clinton "With executives increasingly on the hot seat when corporate compliance issues arise, clear guidance regarding risk areas and best practices is invaluable. Executive Roadmap to Fraud Prevention and Internal Control contains a timely combination of illustrative stories and practice tips regarding hazards in this complex area. It is a good resource for both corporate executives and the many professionals assisting corporations to prevent or detect fraud and build a culture of legal compliance." —Barb Dawson, partner with focus on internal investigations and business litigation, Snell & Wilmer LLP "Executive Roadmap to Fraud Prevention and Internal Control: Creating a Culture of Compliance is a truly phenomenal book. Martin Biegelman and Joel Bartow have accomplished an incredible achievement: they have flawlessly bridged the chasm between the theoretical/academic and practical/tangible. This is a volume that should not be on the bookshelf of every manager interested in compliance and fraud prevention (which should be every manager); it should be dog-eared and open on the desktop of every such manager! Kudos to Messrs. Biegelman and Bartow!" —William J. Kresse, M.S., J.D., CPA, CFF, CFE; Associate Professor, Graham School of Management; Director, Center for the Study of Fraud and Corruption, Saint Xavier University, Chicago "Biegelman and Bartow have again provided an invaluable resource for leaders in the corporate world who have responsibility for fraud, integrity, and compliance. They send a clear message that addressing fraud is a two part process- establishing robust controls and detection measures; and creating a culture of compliance and integrity. This work provides a detailed tour through the world of fraud controls while keeping the importance of culture at the forefront." —Ronald C. Petersen, Executive Director, Global Security, Ally Financial "From the perspective of an ethics and compliance practitioner, Martin Biegelman's and Joel Bartow's new offering is a Thanksgiving feast. Too often, companies and organizations get caught up in the moment, and don't stand back to examine the cultural, organizational and historic reasons that fraud exists. Biegelman and Bartow plow that road, and use their insights to offer invaluable tips in the design of effective anti-fraud programs." —James D. Berg, Vice President, Chief Ethics and Compliance Officer, Apollo Group Inc. "Biegelman and Bartow have indeed produced a functional roadmap for the executive to follow in fraud prevention and internal control. This book is a great asset for those engaged in the seemingly endless struggle to control fraud. A 'must read' for the industry." —Raymond L. Philo, MPA, Executive Director, Economic Crime Institute, Utica College "As if Executive Roadmap to Fraud Prevention and Internal Control wasn't a powerful enough tool for fraud fighters, now Biegelman and Bartow have added fresh insight and advice to the second edition. With compelling updates on costly internal and external fraud and corruption, together with easy-to-read descriptions of latest fraud-fighting technologies, this is a must-read for fraud examiners, auditors, attorneys and others—whether they've read the first edition or not." —Peter Goldmann, President, White-Collar Crime 101 LLC/FraudAware "Fraud borders on the ubiquitous in contemporary corporate culture. This book provides a rich and comprehensive guide to crafting a state of the art fraud deterrence program. While the book is sure to better equip corporate executives and directors in their fight against fraud, I intend to draw heavily upon its content in educating accounting students who represent the CEO's and CFO’s of the future." —Ingrid E. Fisher, PhD, CPA, Associate Professor and Chair of the Department of Accounting and Law, The University at Albany-SUNY "The book's exploration of fraud theories ranging from 'rotten apple' to the 'potato chip' (can't eat just one!), provides useful examination of the psychology of corporate fraud that explains its recurring nature and offers clues to creating a fraud resistant culture." —Zachary W. Carter, Partner and head of the Trial Group, Dorsey & Whitney LLP and former United States Attorney for the Eastern District of New York

Table of contents

The Fraud Risk Assessment Guide is a series of checklists that coincide with the organization-wide model of fraud deterrence explained in the book, Fraud and Abuse in Nonprofit Organizations: A Guide to Prevention and Detection. The checklists in this Guide are designed to identify many of the most important financial controls and non-financial policies and procedures that aid in the prevention, detection, and deterrence of fraud and abuse— both from within the organization and from external sources. Each of the controls, policies, and procedures identified in the Guide are explained in detail in the companion book, Fraud and Abuse in Nonprofit Organizations: A Guide to Prevention and Detection. Who should prepare the checklists in this Guide? One of the keys to making the Guide most useful is to have each checklist prepared by persons who are both: Adequately trained and educated in the subject matter Independent of the persons directly involved in the activity being evaluated These characteristics may be present within the organization— such as by having the checklists prepared by members of other departments or by involving members of the audit committee or board of directors. Another option is to utilize an outside firm that specializes in fraud prevention (this approach has the added benefit of further improving independence and objectivity in the evaluation of an organization's system of fraud deterrence). The end result of utilizing the Guide will be the identification of areas of fraud control in which organizational policies and procedures can be improved (each "no" answer on the checklist represents a possible weakness in the organization's defenses against fraud and abuse). These results should be reviewed and evaluated by senior management, the audit committee, and the board of directors, who has ultimate responsibility for safeguarding the organization's assets.