File1, 2, & 3 for rmiller:



In charitable giving surged to a record high where Americans gave
nearly  billion in charity This undoubtedly has left a positive
impact on the financial sectors of nonprofit organizations But
that being the case the money thats received doesnt always meet
the standards of those who have invested in NPO This problem has gotten
more and more media coverage over the years and along with the increased
capabilities of technology it has been put under the spotlight in the
public eye due to many high profile losses by the nonprofit sector in
recent year So while money in the billions is pouring into the
nonprofit sector from all different angles the issue of what to do with
that money once its gotten such as who gets to handle it where it goes
what to do with it and many more questions like these are still under
some scrutiny by experts in the field

One of the biggest cases in recent history was the Red Cross and their
response to the earthquake in Haiti in  According to the nonprofit
they had built at least  new homes for the people affected by the
disaster The number now currently stands at 6 permanent new homes This
of course came as a surprise to many so the public outcry went through
the roof Yet through all of this the Red Cross is still pounding its
chest and declaring that they helped over million Haitians get
back on their feet There is no evidence supporting this claim
They received half a billion dollars have not disclosed how they spent
it leading to confusion and wasted money While the loss of that money
could be for many reasons in the industry overall in 2014 much of that
loss was due to fraud In its Report to the Nations on
Occupational Fraud and Abuse the Association of Certified Fraud Examiners
ACFE estimated that organizations lose up to five of their annual revenue
to fraud

So, the estimated loss to the financial sector of NPOs in was
billion That amount of money being lost in the public eye is
unacceptable It makes people wonder why that money didnt go to another
organization that has the ethics and capability to get projects done right
Imagine what good  billion can do in the hands of an ethical and
upright organization But shouldnt we strive to achieve a goal in which
that no matter where your money goes its handled properly and sent to
where its needed most It can be done but NPOs must be able to adapt
ito their environment around them both externally and internally


Recently under the Trump administration new tax laws have been
implemented that has a great effect on anyone who pays taxes. So
basically anyone with a heartbeat And for a while even those without a
heartbeat All of us And so as one would expect this had a significant
effect on the nonprofit sector as well Unfortunately it was a negative
one Under these new tax laws its estimated that the sector will
according to Patrick Rooney who is of the Lilly School of Philanthropy at
Indiana University says that the sector could have losses that reach up
to  percent of  billion Therefore going forward one of the actions
that NPOs must take is gaining more influence in the halls of Congress in
Washington DC

NPOs can take several actions that will help them prevent and strengthen
their financial sector They will benefit greatly from a closer look at
the internal controls of an organization being able to analyze and
improve upon their capacity building capabilities and must be able to
engage more effectively with lawmakers in order to push their worthwhile
agendas forward more efficiently resulting in greater outcomes for the
sector Doing this will require quite an undertaking but doing nothing and
allowing NPOs to continue operating as they are may result in continued
losses that reach up the several billions of dollars down the road
The struggles within the nonprofit sector have been a reoccurring theme in
the industry ever since the During this time, NPOs focus began
shifting on more creative ways of financing their organizations Many of
the strategies that were developed that mirrored those of for profit
ventures due to their success at the time Subsequently because of this
trend NPOs began to be looked at much like ventures looking to profit
when being analyzed by experts Understandably these experts then began
making judgments based on how well a nonprofit does compare to another
leading to a more competitive marketplace

While some good came of this such as increased attention on
accountability it overall has become a detriment to the industry Because
of this competitive mindset tensions between NPOs increases leading to
disharmony This is especially harmful considering that NPOs are an
essential part of creating a balanced healthy and generous community
One of the ways that NPOs can separate themselves from for profit
ventures is by highlighting their differences By focusing on their
differences they can determine where their strengths and weaknesses lie
and be able to react and adapt accordingly to an ever changing
environment increasing the potential for financial gain and disbursement


Nonprofit finance theory is essential to understanding how to improve any
financial sector Any theory of nonprofit finance must account for
three basic issues  financing of current operations, financing of
capital needs and the balance or mix among different sources of income for
these purposes Financing of current
operations refers to the short term financial goals that an NPO is trying
to achieve, while financing capital needs speaks mainly to the survival of
the organization down the road and balancing different sources of income
speaks of problems that are related to administrative feasibility making
sure they have enough to pay off their liabilities and risk assessments
Improving on these three fundamental aspects of the theory will help
nonprofits in their ability to maintain control over their finances
However even if all of those are in an exemplary manner there are still
other issues to account for that go beyond just the theories such as the
actions of people within the organization the ever changing environment
in which they operate and the actions taken by the government such as
when new legislation is passed that affects tax breaks and government funding

People can be unpredictable Whether this unpredictability is a result of
purposeful action or a mistake the outcome speaks for itself One of
these unpredictable actions that harm many NPOs is fraud Fraud accounts
for significant losses within the NPO sector but goes largely ignored in
many cases. The reason many of these organizations do not change is that
they do not wish to admit fault leading to nothing being done to fix the
issue allowing for the incident to take place once again. Admitting fault
could also lead to problems with donors and reputation down the road
which are two imperative elements NPOs need So how does an organization
prevent incidences of fraud from taking place The answer lies within the
internal controls of an organization A study conducted by Herbert Snyder
Margaret Anderson and Jill Zuber professors of accounting at North
Dakota State University addressed this problem with a question

Using  usable surveys they asked NPOs who had both experienced and not
experienced fraud how they handled fraud within their organization It
found that a large portion of NPOs are determined to believe that it is
the work of individuals with a criminal mindset that is the root cause of
fraud not because the internal controls are inadequate While this may
be true to a certain extent there are many ways in which NPOs can help
prevent these types of situations from occurring in the first place
According to the study, NPOs that invested more in internal controls were
more capable of finding when these situations occur than those that
dont Out of irregularities within an organization on average
of them are found through the specific investigation of employees This
involves changing the workings of their internal controls Those that
changed their internal control capabilities to mirror those that hadnt
experienced fraud were found to have much better odds of it not recurring
in the future as opposed to those who did next to nothing when such
incidences occurred While not all these issues can be dealt with using
definitive methods there are some steps that organizations can take to
help minimize damage

No lines are longer than 80 characters, TYVM. Other specified properties aren't being scored automatically at this time so this is not necessarily good news...