Reposted from AICPA Insights, January 25, 2016 Post by James B. Jordan, CPA, CGMA
Contributions – whether by cash, check, or online giving – are the lifeblood of faith-based organizations. Many do not realize how often these donations get into the wrong hands.
There are primarily two types of theft that occur in faith-based organizations –larceny and skimming. Larceny occurs after the money has been counted, deposited, and recorded in the books of the organization. Skimming occurs when donations never get logged in the books; that is, they go missing before ever being recorded. It is the counting and depositing process that opens the organization up to skimming, and that is where fraud can be most difficult to detect.
Faith-based organizations need to take steps to ensure that contributions make it into the bank in the first place.