One of the most detrimental things that can happen to a business is embezzlement. Without control over finances, an organization may experience a number of hardships, from difficulty staying within budgets to unrest among employees when theft is suspected to have occurred internally. Prevention may be the best cure when it comes to staving off financial misconduct, and one crucial component of this process is conducting AP audits.
According to The Associated Press, the Institute for International Sport in Providence, Rhode Island, has discovered that it may have fallen victim to insider crime. An AP audit discovered $1 million was missing from the non-profit group’s accounts, and founder Daniel Doyle has been charged. The source noted Doyle pleaded not guilty to the accusations, which include embezzlement, forgery, obtaining money under false pretenses and filing false documents.
The news provider cited a criminal indictment which indicated Doyle had misappropriated funds to give himself unauthorized pay raises, which was used for personal expenses, including his daughter’s college tuition. The audit also revealed the institute could not account for money it received as part of a legislative grant to construct a building on the University of Rhode Island’s campus. The structure remains unfinished.
According to Head Start, one of the most common financial problems non-profits face is fraud, and embezzlement is just one of these potentially disastrous events. The organization emphasized that taking precautions may be the most effective way to prevent internal issues from adding up to significant losses. While it is important to have strong financial controls in place, this is not enough on its own. Head Start explained that programs must be monitored for the entire system to operate correctly. One way to remain vigilant is by conducting frequent AP audits.