Financial experts can help nonprofits protect themselves against fraud

December 9, 2013

Financial experts can help nonprofits protect themselves against fraud

For-profits and nonprofits are at increased danger of cyberattacks and fraud. Small and midsize businesses in particular are at risk because of uncertainty about possible security threats. A study by the Ponemon Institute found that senior management at many smaller companies is failing to prioritize cybersecurity.

For nonprofits, cyberthreats may be even greater
Cyberthreats often come in the form of identity theft or the breach of sensitive financial information. Unfortunately for nonprofits, their charitable nature often puts them in the sights of con artists, both on the Web and in person. Nonprofits that are struggling to meet financial obligations likely do not have the resources to prepare for possible scams or cyber attacks.

Professional financial services can help mitigate fraud risk
One way for organizations to keep the risk of fraud low is to have a strong handle on their finances. Understaffed accounting departments can often fall victim to scams without even noticing it. The theft of financial information through a cyberattack may take a month or more to show up on statements and reports. By that time, the impact of the attack will be much greater.

Professional financial services can supervise a nonprofit's accounting staff or even fully assume the department's responsibility. This not only provides better protection against fraud, but can also free up employees that could be utilized elsewhere.

Experts can also conduct fraud prevention audits so that nonprofits know how vulnerable they are to an attack. Along with these specific audits, organizations can have a review of their accounting systems, payroll and benefit systems. This not only reduces instances of fraud but also helps the organization run more efficiently.

Content presented by First Nonprofit Group, a leading provider of financial consulting services for 501(c)(3) nonprofit employers.

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