Nonprofit News

How Organizations Can Mitigate Financial Risks During the Health Crisis

By March 19, 2020 No Comments

By Bradley Bartells, CPA, MUN CPAs

The current health pandemic is going to create additional risks to the financial stability and well-being of not-for-profit organizations. With organizations sending employees home to work remotely, or potentially employees out with an illness for an extended period, the leadership of NFP organizations need to take additional steps and precautions to address the increased risks of fraud and/or errors to an organization’s financial information.

Some tips to mitigate the risk of a financial loss to your NFP organization:

  • Make sure expense payments to vendors continue to have appropriate reviews and approvals before payment. Fraudsters and scammers may be trying to get money from organizations who are distracted. Make sure your employees and finance team understand the importance of continuing to follow your organization’s policies and controls for expense payment approvals. It’s OK to be a little extra skeptical and cautious right now. Don’t shortcut!
  • Fraudsters and scammers are trying take advantage of your employee’s fears, confusions and unknowns. Be overly cautious of unexpected e-mails asking for information. Make sure your team is continuing to be skeptical of unexpected e-mails or e-mails from unknown sources. If in doubt, make sure your staff knows to pick up the phone and call to verify information. Even e-mails from a known co-worker or business associate should be scrutinized if the message or request is unusual or somewhat confusing.
  • With many workers potentially working remotely from home, make sure your finance team has regularly scheduled calls to keep your finance team on as normal of a routine as possible. Staying in regular communication when finance departments are potentially fragmented will reduce the risk of a task or issue being overlooked, which in turn will reduce the risk of a financial reporting error.
  • Create scheduled task lists for your employees working from home, to ensure tasks and responsibilities are not overlooked. When employees are accustomed to a work routine, and that routine is disrupted by having to work in a new location, normal tasks and responsibilities may get overlooked. Ensuring that your organization’s normal monthly financial close and reconciliations are performed timely will reduce the risk of a financial reporting error.
  • Create a list of employees who are backups to perform higher priority tasks, in case the primary employee responsible for a task becomes ill and is not able to work for an extended period.
  • Give all of your remotely working employees contact information for your IT provider, in case they have a problem accessing your organization’s network.

These tips will help to ensure your organization’s financial reporting remains consistent when we all get to the other side of this health crisis. Stay safe!

Bradley J. Bartells, CPA
[email protected]