Community directors release survey on NFP governance

The Institute of Community Directors Australia has released the results of a survey on NFP governance and financial oversight.  The survey was conducted earlier in 2015 and asked questions of 845 senior NFP representatives.  The results are presented in a report that offers interesting insights into governance and financial oversight.

Ten key findings are listed below.

Topic  Finding 
 Understanding finances Fifty-six per cent of respondents agreed that most board members had a good understanding of their organisations’ finances. Only 16 per cent believed that all members of the board had a good understanding of the finances of the organisation they were governing
 Treasurers Fifty-three per cent of community groups had difficulty recruiting treasurers to oversee their finances, 5 per cent of NFPs paying their treasurers (traditionally an honorary position), rising to 11per cent for larger NFPs
 Fraud Six per cent of organisations surveyed had experienced fraud in the past three years, 60 per cent of them unreported to police. The bigger the organisation, the higher the rate of fraud. It was estimated that Australian NFPs could be losing up to $38 million to fraud each year.
 Risk Management Thirty-one per cent of organisations believed that they didn’t need any formal risk-management processes because they trusted their staff. Nonetheless, 79 per cent of reported frauds were perpetrated by trusted insiders.
 Funding sources Sixty-three per cent of large NFPs relied primarily on government contracts and grants for funding, while almost one in five sourced the largest part of their income from trading activities or service provision.
 Cyber-crime Twenty-nine per cent of respondents said that their organisation wasn’t doing enough to protect against cyber-crime, while a further 39 per cent were not sure if their organisation was doing enough.
 Funding continuity Eighty-five per cent said it was becoming harder to find consistent and regular funding. But despite the challenges, NFPs continued to expand their operations
 Raising revenue Twenty per cent of organisations said that the past year had been the most challenging for raising revenue
 Mergers Fifteen per cent of respondents said they expected to take part in a merger in the next 12 months
 Overheads Fifty-six per cent of organisations were feeling pressure to reduce overheads.  Half of these said that most of the pressure was coming from their own board

Visit to view the report in full and find out how your organisation compares.

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