Non-Profit Fraud | Fraud Risk Assessment | Forensic Audit
Another Case of Non-Profit Fraud – Ho Hum, What’s New?
Astinel Security & Forensics recently reviewed a case where a non-profit organization had become victimized by employee embezzlement. Our discoveries normally find a lack of internal controls or a vulnerability which permitted the fraud to occur. We also see where an internal audit routinely failed to find the fraud. The difference was that this particular non-profit, was an extremely well known, well established organization. They handle a large volume of donations and one would expect them to have basic controls in place.
Though basic rudimentary controls lacked in this non-profit, we never blame fraud victims and will work to educate. Beyond the loss from the embezzlement, this organization will spend a substantial amount of time, money and resources for a forensic audit. The criminal prosecution phase will be lengthy and productivity will be severely impacted.
If you have followed us you know how we promote the benefits of a fraud risk assessment. Financial statement audits are important, but they are not focused on fraud detection. Even if you are not on the board of directors for a non-profit, or a member of senior management, ask if a fraud risk assessment has been performed lately.