Sunday, November 30, 2014

53% of City-Funded Nonprofits Failing Accounting Standards

Two weeks ago, I blogged about the City Controller's Office replying to my query about the last time HIV service groups receiving public dollars were last audited and it was back in 2007-2008 when the books were combed over by the City.

The City Controller also made me aware of the FY13-14 Annual Report of the Citywide Nonprofit Monitoring and Capacity Building Program, which was issued in October, and while it's not specific to AIDS organizations, it's still of interest to me.

This chart shows the nonprofits with the most "outstanding findings", which is bureaucratese for failure to comply with accounting standards. The report says, "In addition to repeated findings, having a large number of total findings can also illustrate potential instability."

Yes, and just one or two findings of noncompliance could be about major faults at a City-funded nonprofit that should be of concern to the Controller and taxpayers.

This is quite an alarming statistic: "62 contractors (53%) had one or more findings (i.e., did not meet a standard in some area)." More than half of the nonprofits receiving City dollars weren't in compliance with all mandated accounting standards.

In my view, we need a full and public discussion about this October report to the Mayor and Board of Supervisors. I don't recall any attention given to its release and findings, but if there were hearings or coverage of the report, please let me know about where or when if was scrutinized at City Hall or in the community.

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