Board Treasurer 1597
I’m an Executive Director of a not for profit with a budget in excess of 1 million dollars. Recent changes in the Board, ie; a new Treasurer have begun some controversy.
The new Treasurer wants to have all of the organization’s financial information on his home computer. I do not think this is appropriate for many reasons.
I’d like to get some feedback to see if I’m on the right track here or way off base.
Is this Not-for-Profit publicly traded? If not, you have no requirements under Sox, but it does seem that personal access to financial statements at home is inappropriate.
Is your treasurer the sole owner of the financial statements? I.E. does he have accountants or clerks who process and summarize information? Does he even produce the financial information? When he is at home, would he be able to change numbers on the statements? What kind of segregation of duties exist in the financial statement process? Would anyone at his home have access to the statements?
These are some questions to ask yourself, or others on the board when considering if it would be appropriate to give the treasurer this access from home.
By the way, welcome to the forum.
lekatis last edited by
Your opinion is absolutely correct. As an expert witness, I want to assure you that if you keep all of the organization’s financial information on a home computer, you do not exercise due care. Even if you are honest, chances are that somebody will sue you, and you can not prove that you meet the standards. Or, somebody will sue you because you can not prove whatever.
This is always the challenge: To meet the standards. If something wrong happens, you must be able to prove that you did your best to protect the interests of your organization. You can not prove it now. So, if something wrong happens, you are also responsible because you didn’t exercise due care and due diligence.
Your main problems:
- No controls
- No segregation of duties
- Home PC means that there is no physical security, members of the family or friends have access, multi-role PC with financial information (absolutely wrong from a security perspective) etc. etc. etc.
You are on the right track. Good luck.
Thanks for the welcome and your input.
This is a private not for profit. We outsource our bookeeping. She produces the reports. His reasons for wanting to have all the information is that he wants to ‘play around’ with the information. In my mind this crosses the line into management not governance.
I just think we are setting ourselves up for real trouble.
Play around with the bookkeeping??? I’m sure he’s as ethical as anyone else, but there really is no business need to ‘play around’ with financial statements. Tell him if he wants access to them at home, he can print them out himself and fold them into paper airplanes.
Thanks so much. This is great information to use asa part of my defense…
harrywaldron last edited by
As an expert witness, I want to assure you that if you keep all of the organization’s financial information on a home computer, you do not exercise due care …
George shares an excellent response from an audit and financial perspective
I’ll briefly add that having data on a home system could be lead to yet other issues (e.g., theft, computer virus or spyware issues, data getting out-of-sync, etc).
For example, some weeks ago we read about a missing laptop that contained sensitive information for over 26M veterans. Thankfully, this appears to be more of a random burglary, than someone looking to conduct indentity theft on a massive scale. According to media reports, the laptop was stolen from the home, sold for USD100, and not accessed according to FBI forensic analysis.
Stolen laptop containing info on 26 million veterans recovered
Please add www to link after cut/paste into your browser
kymike last edited by
As the volunteer treasurer of a USD1MM plus NFP (not the one mentioned above), I can see the benefit of having access to the financial information from home. I agree that the financial information should not be ‘kept’ on a home computer, but access to it should be OK. As a volunteer, my time is limited and working from home would provide me with much more analytical time than at the NFP office.
I like to ‘play’ with the numbers as well. My definition of this is purely analytical (forecasting, understanding revenue trends), not criminal (cooking the books). I have a PT bookkeeper who records all of the financial information, so I do not make adjustments to the books at all, only provide the review and oversight function.
While this thread has nothing to do with SOX as we are not talking about a listed company, it does have some good points about internal controls over financial reporting. One point that I do try to get across to the people that I work with in my paid job overseeing internal controls is that we need to work the word ‘SOX’ out of our vocabulary and look at what we do related to financial reporting as good internal controls. We don’t do this because SOX requires it, but because it is the right thing to do (SOX just happened to come along and remind us that we had gotten off track at some point in the past).