Paralyzed Veterans of America
Paralyzed Veterans of America/Buckeye Chapter Executive Director Sharon Moster keeps a close watch on her nonprofit’s finances. She offers tips for other nonprofits to ensure they have strong internal checks and balances for monitoring their money.
PVA/Buckeye Chapter Practices Good Financial Habits
Sharon Moster’s first day on the job as the new Executive Director of the Buckeye Chapter of Paralyzed Veterans of America (BPVA) included the very last kind of phone call she would ever have wanted to receive. When she answered, the state’s Attorney General was on the line. It turned out that the telemarketing firm that BPVA had been using for fund development was scamming people, and the AG’s office wanted BPVA to cut its ties with the company and help in their investigation.
Moster had actually told the Board that, if hired, she planned on cutting ties to the telemarketing firm, wanting to try other kinds of fundraising. So losing that partnership was not a major hardship. But gearing up to do more of its own fundraising meant that Moster got busy right away digging into her new employer’s books. She discovered that the nonprofit, which lacked nonprofit business expertise on its Board, had not yet implemented a number of financial housekeeping habits she knew were important from her many years in nonprofit management. Within six weeks she had initiated several practices—many of which, she laments, are often not followed by small nonprofits. “It’s vital for nonprofit directors and board members to become more aware of their finances and bookkeeping procedures.” Moster emphasizes. “Any kind of financial mismanagement can become a huge problem.”
At BPVA, Moster implemented the following practices that other NPOs should consider implementing (if they have not already):
- One employee opens the mail and a different person sends out bill payments
- In addition to the Executive Director, an accounting professional (e.g., bookkeeper) reviews the corporate credit card statements to catch any mistaken or questionable charges
- A Board member who is not authorized to sign checks has access to the nonprofit’s online bank account in order to review the activity in the checking account
- Any check over $500 requires two signatures
- The organization has purchased theft insurance
- The organization requires staff and Board members to sign conflict of interest statements
“Too many nonprofit Boards don’t pay adequate attention to these kinds of issues,” says Moster. “And sadly, employee theft does happen sometimes, as do other irregularities. Nonprofits are entrusted with donors’ gifts. Vigilance is required.”