The increasing prevalence of fraud and fraudulent activities within commercial and government entities should ring alarm bells for all NGO administrators.
NGO’s tend to lack the sophistication of corporate entities in levels of security and anti-fraud practices; something when coupled with the ever-increasing use of computers by NGO's opens a significant doorway for unscrupulous staff or volunteers to take advantage of the typically trusting and nurturing culture.
Not everyone helps NGO’s or participates in activities for the simple desire of helping the less fortunate. Some people have entirely different motives and view NGO’s as a ‘soft target’ for conducting fraudulent activities. Of equal concern are some less-than-ethical commercial entities that likewise view NGO’s as a soft target for providing goods and services of dubious quality, often at costs well above what is considered reasonable by commercial or Government recipients.
Preventing fraud in a computerised workplace involves implementing an array of systems securities, policies and check-back (exception reporting) mechanisms compliant with best practice auditing. This can seem daunting to small NGO’s struggling to achieve basic computer efficiencies and organisational sustainability, let alone worrying about the possibility of fraud – yet it is vital for all NGO’s to implement compliant check-back mechanisms and to induce a culture of anti-fraud behaviour. Even a single fraudulent act by staff or a volunteer can destroy a community’s trust in your mission (a trust you have probably nurtured for years), and cripple the largest, most well meaning NGO.
NGO managers and administrators seeking ways to prevent fraudulent activities should discuss the topic with a suitably qualified auditor who can advise on ‘best practice’ guidelines and policies. Public (and free) information is available from the Institute of Internal Auditors, including an excellent series of publications titled
Proactively Detecting Occupational Fraud Using Computer Audit Reports. This is a series of documents (available for free download although a donation is requested) designed to help ensure your computerised accounting practices mitigate the threat of fraud and are suitable for proper anti-fraud auditing.
Rgds, Don