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Article Archives >> Ready Reference >> March 1-15, 2008

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Compliance Assessments Protect Charities – Part II
Proactive review can reduce the risks
of waking up to adverse publicity and loss of trust

The first five priority issues involving charitable compliance assessments were discussed in the previous edition of Nonprofit Issues®.

Excerpt
Sixth, examine the IRS Form 990 tax information returns and other registration materials your organization files with the IRS and/or state registration offices to verify that they are accurate, complete, and free of material falsifications, misrepresentations, and omissions.

Both the states and the IRS are increasingly calling charities to account for making material false statements in registration materials and IRS 990 Returns — both of which are signed under penalty of perjury.  (See Nonprofit Issues®, January 1, 2008.)
 
For example, in Pennsylvania, charities can be fined up to $1,000 for each false statement or omission; they can be prosecuted criminally for each intentional, material false statement or omission; and, perhaps most importantly, they can receive huge amounts of damaging, negative publicity that can seriously hinder their ability to raise contributions in the future and, therefore, threaten their very viability.

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Article Archives >> Ready Reference >> March 1-15, 2008