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Nonprofit Quick Tip: Monitoring Electronic Donations

CPAs & Advisors

Michael Evrard
Michael Evrard CPA Principal CPAs & Advisors

Does your nonprofit organization receive donations first gathered through a third-party site or software, such as PayPal? If so, ensure you have proper internal controls over these funds, which should include frequent monitoring of the account by someone other than the person charged with custody and transfer of the funds.

It is essential that more than one person has access to the account and regularly monitors it; otherwise, it is possible for an employee to transfer funds into a personal account instead of the organization.

Review the transaction data at least monthly. Remember to document the review with a name and date and ensure an appropriate person performs it.

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