Reporting and Operations

General Information

Size of Organization: 
  • The internal control system needs to be documented (the expected results or outcomes of the system and what everyone does need to be put in writing) and constantly evaluated.  A continuous quality improvement (CQI) system should be implemented for the evaluation.
  • All of the nonprofit organization's staff must receive training about the internal control system and their individual responsibilities within the system.
  • The organizational chart, accounting procedures, record retention policy, and chart of accounts must be maintained on a timely basis to eliminate outdated information and include current information.
  • Standardized forms should be used whenever reasonable.  
  • All journal entries are supported with information that clearly document and justify each entry.
  • The organization needs a conflict of interest policy.
  • Appropriate bonding must be maintained on employees.
  • Recordkeeping duties are separated from operational and custodial duties.
  • Staff assignments are rotated and staff are required to use vacation time.
  • The internal control system is reviewed annually with the board committee (typically the finance or audit committee) responsible for assessing the organization’s internal controls.
  • Use your financial system to calculate and process financial information whenever possible.  Minimize the use of spreadsheets and journal entries if the financial system can calculate and post allocations, depreciation and other like items.