Australia's First NFP Fraud Survey

Chartered accounts BDO, in conjunction with Queensland University of Technology and the Not-For-Profit Network are finalising the results of a national on-line survey aimed at determining the level of fraud in the Third Sector.

In what is believed to be an industry first, the data will be used as a benchmark for following surveys to be held every two years, and give the Not for Profit sector information on the likely areas where fraud may be happening in their organisation.

BDO forensic services associate, Lisa Bundesen, says there are several ways fraud could occur in a NFP organisation.

Bundesen says the typical one is monetary fraud, including theft of cash or donations, as well as payroll fraud, online payments fraud, credit card fraud and theft of assets, all of which can be detrimental to an organisation.

She says there is also non-monetary fraud which can involve theft of a database or other intellectual property, advocacy fraud and kickbacks.

She says the bottom line is the consequence which can force an organisation into liquidation resulting in the potential loss of an important service to the community.

Ms Bundesen describes fraud as an act or omission that was intentionally dishonest where a benefit is obtained either by the person who commits the act or omission, or someone else associated with that person.

She says this survey will not only gather important data about potential fraud in the sector, but highlight the importance of an organisation’s need for good corporate governance and appropriate structures and systems to prevent potential fraud.

The Not-For-Profit Network’s managing director, Belinda Busoli, says fraud could damage an organisation’s most valuable asset, its reputation.

The researchers say the first step for Not for Profits in the battle against fraud is to understand how it is occurring and then build future education around it.

The survey results are expected to be launched at the end of March in Brisbane.