Pilot Ship Consulting

Does anyone I know have experience using Tipalti with a Canadian org? Would love to chat on experience/reviews.

In this mornings Waypoints Newsletter I wrote about the One-over-one process for approving expenses, and why I'm not a fan. I also talked about (for the 100th+ time!) how the software, apps, and platforms we're already subscribed to and using, have a tremendous amount of functionality that you're probably not tapping into. Don't know what those functionalities are, or how to use them? Little tip - > Chat GPT does! You can read todays edition, and subscribe to receive the Waypoints Newsletter every Thursday morning, below.

[07/99] Asset Tracking

Better said and laid out than we could have ever done! A great resource on how to get started thinking about your nonprofits' tech stack!

This story highlights two lessons and sparks a personal note. Lessons: Payroll Payroll processing, especially in small organizations, is a top three target area for theft and misappropriation. Typically, only one or two people have access to or an understanding of how payroll processing and calculations work, and there are many ways these inputs can be tampered with, beyond just unapproved wage increases and additional payments. You don’t need to be a CPA or payroll professional to be able to provide oversight to your nonprofit's payroll, but it does require building an understanding and being consistently diligent. Collusion A major fear among folks who work in fraud prevention and financial oversight is collusion - when two or more people are working together to perpetrate fraud. Many of the most basic policies and procedures that an organization would feel confident about having in place can be overridden or circumvented when someone with signing or approval authority recruits someone else with similar authority to conspire together. It’s situations like these that can go undetected for years and turn a seemingly innocuous risk area like vacation accruals or payouts, into six-figure frauds like this. On a personal note: Dante’s Inferno describes nine distinct circles of hell, each deeper circle being reserved for those guilty of more heinous categories of sin. Greed is in circle 4, Fraud in the 8th, and the 9th is reserved for treachery. Punishments progress from things like shaming to being encapsulated in ice or engulfed in flames for eternity. Many of us work in nonprofits because we are passionate about our cause, or we want to spend our days giving back to our communities instead of working solely for profit. Over time, however, our passion organizations can become just our workplaces, and the stats show that rates of fraud in nonprofits unfortunately seem to pretty closely mirror those in any other small business. I suppose I can understand how that happens – but what I still hope for is that there is a deeper, much more severe, 10th circle of hell reserved for anyone and everyone who ever even thinks about taking as much as a penny from an organization that exists to protect the health, well-being, or safety of our children. That’s just me, though.

The notice of his disbarment has brought this story back into the news cycle this week, and reminds us of some key lessons that are important for all nonprofits. Hiring qualified or certified staff, and having all the right policies in place is not enough on it's own to deter and prevent these sorts of frauds from taking place. The University of Manitoba has: -Over 9,000 people on staff -An annual budget of ~$900m -An entire financial services department, including an internal audit function -A leadership team and a Board of Governors filled with CPAs, Phds, Lawyers, Engineers and senior business leaders from their community and alumni and this was still able to happen. Not through any genius criminal mastermindery mind you, but predominantly through expense claims. Proper financial oversight of course includes a clear and comprehensive list of policies and processes, and systems for approval, and I'm sure UofM had most of those. But for all of those sorts of systems to be effective, it needs to be supported by a culture of oversight. It takes diligence at all levels, and needs to be encouraged and supported from the very top. The question you need be asking your organizations right now is fairly simple. How long is the process for your organization to go from a senior leader telling a finance staff person to "Stop asking questions and process my expense claim" to having the risk of that sort of behaviour reviewed and addressed? Because for UofM, it looks like it was about 4 years and somewhere over $500k. Hopefully the culture and processes you have in place at your nonprofit would be a bit more efficient.

Apropos of absolutely nothing: While in a zoom waiting room yesterday I dropped the text from the morning's Waypoints Newsletter into Chat GPT and asked DALL-E to generate an image to reflect the content. Yesterday's title/heading was "Slow is smooth, smooth is fast". I don't know if it's a good representation of what I wrote yesterday or not, but I do know I can't stop looking at for some reason...

CPA Canada and the Canada Revenue Agency are co-hosting a webinar to address some of the top questions about SR&ED ahead of the federal government’s review of the program, which is expected to play a key role in this year's federal budget. The full webinar will soon be released on the CPA Canada Canadian Tax News page.

16/99 - Payroll Audits

In this week's Waypoints Newsletter we talk about how allocating a training budget for your board members is just as important as training for staff and other volunteers, and how purchasing card (or P-Card) programs can offer a much higher level of protection and security for your nonprofit's spending. Subscribe below to get the Waypoints Newsletter in your inbox every Thursday morning!