When it comes to preventing corporate scandals, regulators typically look to the board as the first line of defense. This is especially the case in the nonprofit sector, where there is no market factor to provide additional oversight and protection. It is in this context that the board’s audit committee provides particular value. Amongst its many roles is the general expectation that it will monitor the potential for financial irregularity and be attentive to the warning signs of fraud, malfeasance or gross mismanagement. And, in the nonprofit sector, we have several recent examples where state and federal regulators are probing prominent charities based on allegations of financial impropriety and conflicted business transactions.
To help us consider this unique role of the Audit Committee, and how it relates to these recent scandals, Michael Peregrine welcomes Scott Steffens and Dianne Wasieleski of Grant Thornton.