It’s important to understand the serious ramifications fraud can have on an organization. Most organizations that undergo fraudulent attacks, never recover their losses – making it even more imperative to understand why and how fraud can happen.
Luckily, nonprofits can use their accounting software solution to help them find current instances of fraud and prevent future attacks.
Prevent Fraud Using Your Nonprofit Accounting Software
Fraud prevention is just another reason nonprofits need fund accounting software. Your accounting solution can help you prevent and find fraudulent activities happening within your organization.
While you should have a yearly scheduled external audit, you should also periodically perform internal audits. These should be “surprise” or unplanned audits to help you stay on top of accounting, finance, purchasing, sales and other departments. Unplanned audits can potentially catch misappropriations that normally go 18 months without being detected.
Using your nonprofit accounting software, you can prepare for both your planned and unplanned audits. Using the Export to Excel feature and creating user defined fields can help you stay organized, and keep accounts clean. Read Using Your Nonprofit Accounting Software to Prep for an Audit to learn more.
Nonprofit software helps you stay organized, which protects your organization from potential fraudulent attacks. By staying organized you’re prepping you and your people for both the planned and unplanned audits, ensuring that information is consistent throughout departments.
Additional Fraud Prevention Tips
In addition to using your nonprofit accounting software, you should also implement a few of the following procedures to prevent fraud from affecting your organization.
- Create a Written Fraud Policy Document – Having a set policy in place will ensure that all employees understand that fraud will not be tolerated. Make it a point to review the document throughout the year so new employees are made aware, and for long-term employees to be reminded.
- Teach Employees Signs of Fraud – Most fraudsters exhibit certain warning signs of their crimes. By teaching your employees these behavioral characteristics you can have more eyes on the look-out. Examples of fraudster behavior include: living beyond their means, close relationships with vendors/customers, experiencing financial difficulties, and control issues.
For more information on preventing fraud, specifically check fraud, read Ways to Prevent Nonprofit Check Fraud
It’s important to understand the damage fraud can cause an organization. Sadly, most organizations that fall victim to fraud never recover their losses.
Capital Business Solutions provides nonprofit accounting software to public and private organizations. We offer our clients business consulting, software implementation, training and ongoing support, in addition to our custom development offerings. To learn more about our nonprofit products and training, please contact email@example.com, call 919-821-1244 or fill out our online contact form.