Editorial: Non-profits should protect funds

0
Jan Larson
McLaughlin

Most people join non-profit organizations to serve others, not to scam them. They want to support a
cause, feel warm and fuzzy. Not line their own pockets.
But once again in Wood County, the person entrusted with a volunteer group’s finances was caught
profiting from that position. This time, the treasurer, Eric Whitson, allegedly stole at least $80,000
from the Bowling Green Athletic Boosters.
We haven’t been very quick to catch on in Wood County that people with unfettered access to funds
sometimes take advantage of that blind trust.
Prior to the BG Athletic Boosters, it was a group of Perrysburg parent and youth organizations, which got
bit by their treasurer for an estimated $110,000.
Before that, it was a volunteer with an Eastwood youth soccer association, who pocketed $14,716.
A Pemberville church and a Perrysburg senior facility are among those betrayed by the people they left in
charge of their financial books.
I guess it’s only natural for non-profit groups to have a trusting nature. After all, most volunteers get
involved to serve others, not themselves. And to be honest, most groups of volunteers breathe a sigh of
relief when a member agrees to handle the finances. In many cases, the treasurer is not questioned as
long as there is enough in the budget to pay for necessary expenses.
But after so many instances of volunteer treasurers getting caught with their hands in the cookie jar,
you would think organizations would catch on. Treasurers need supervision. And most people in those
positions of financial responsibility would welcome some extra sets of eyes on their calculations.
Just because a group is non-profit doesn’t mean they can’t afford some safeguards on their finances. In
fact, it’s just the opposite. They can’t afford to have their finances squandered in secret by their
treasurers.
Those funds need to be treated with transparency, since the money was given by parents, patrons or
parishioners with a goal in mind.
Putting checks and balances in place does not need to be costly. A group called PTO Today suggests simple
safeguards.
First, always require two signatures on checks.
Second, maintain a paper trail. Don’t get in the habit of writing out checks for expenses unless receipts
are submitted.
Third, require that reports be submitted monthly. And don’t just gloss over the numbers. There’s nothing
wrong with getting out a calculator and doing the math.
Fourth, the accounts should be reconciled monthly. Balancing checkbooks can be painful, but necessary.

And finally, conduct an independent audit annually.
Wood County Auditor Michael Sibbersen acknowledged that some volunteer groups don’t have the finances to
pay for an independent audit. But they can at least do a bargain audit, by asking a couple outside
people to help review the budget annually.
"For many organizations, the independent audit is expensive," Sibbersen said. So go with an
inner audit instead. "It gives you some assurances."
Sibbersen also suggested that boards:
• Set threshold amounts for expenses that require board approval.
• Don’t allow a check to be made out to the same person signing the check.
• Require explanations for any monthly adjustments to the books.
• Consider quarterly rather than annual reviews.
"Some boards don’t get monthly statements at all, so they aren’t even aware," Sibbersen said.

None of these checks and balances are costly – but they can save non-profit groups from having their
funds siphoned by trusted treasurers.

No posts to display