The NFP Risks and Compliance Newsletter writes how the Institute of Internal Auditors – Australia has released a new guide for directors of NFPs, drafting 20 critical questions they should be asking.
“The 20 critical questions include:
- Is the NFP organisation’s governance framework contained in a formal document that adopts a holistic multidimensional approach to capture all structures and processes across the organisation: code of conduct and conflict-of-interest policy covering members, paid employees, non-paid volunteers and suppliers; strategic management, based upon risk and with strategically based budget-setting; cash-reserves policy; risk management, insurance, fraud risks; resource management; information management; compliance and reporting; and audit and review?
- Have NFP organisational and fraud risks been identified? Are there appropriate risk-management actions in place, monitored and regularly reported to the board?
- Have governance activities, responsibilities and delegations been cleary defined, specifically for NFPs, and detailed in a fit-for-purpose governance document that is regularly reviewed and updated?
- How does the board gain assurance that all government and regulatory requirements have been identified and assigned, and that the NFP conforms with these requirements?”
- With NFP charities being one of the largest employment sectors, with over an annual revenue of over $1.42 Billion (2016), IIA-Australia CEO Peter Jones said the questions were a quick and easy reference. ‘Good governance structures are [as] important in the charity and NFP sectors as it is in the financial-services sector,’ he added.
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