| ‘Encouragement
of a Great Example’: CPAs on Boards
MARCH
2005 - Alexis de Tocqueville, the 18th century politician
and social philosopher best known for his book Democracy
in America, wrote “Americans … have voluntary
associations of a thousand kinds: religious, moral, serious,
futile, general or restricted, enormous or diminutive. …
If it is proposed to inculcate some truth or to foster some
feeling by the encouragement of a great example, they found
a society.”
Almost
200 years later, de Tocqueville still shows rare insight,
but even he might be surprised at the growth of the nonprofit
sector in America. According to the National Center for
Charitable Statistics, there were more than 1.3 million
nonprofits nationwide as of 2003, with almost 91,000 in
New York State, representing more than $231 billion in gross
receipts and $254 billion in total assets. About half of
all nonprofits are devoted to “charitable and educational”
purposes, and an unknown number of small community groups
and other organizations operate outside the center’s
scope.
De
Tocqueville’s words are inspiring because they reflect
our country’s strong tradition of helping others as
one facet of our democracy. But that tradition carries responsibilities
and obligations as well, for strong governance, capable
management, and accountable leadership. Neglecting
those obligations lies behind cases such as Hale House,
the United Way, and, more recently, the Legal Aid Society.
Most of the Legal Aid Society’s problems seem to stem
not from malfeasance, but from executives’ misguided
hopes that cash flow problems would solve themselves. But
in all cases the lesson is the same: Weak governance and
controls are the key ingredients of failure.
Collaborative
Partnership
Because
all nonprofits deserve strong governance and controls, but
many lack the resources to develop them, the NYSSCPA is
partnering with the Better Business Bureau of New York;
the Nonprofit Coordinating Committee of New York, Inc.;
the Council of Community Services of New York State, Inc.;
the Alliance for Nonprofit Governance; and the United Way
of New York City. The purpose of this partnership is to
ensure that nonprofits run with professional financial expertise
as public-interest entities. The name of a new program to
match CPAs with organizations that need their expertise
is CPAs on Boards.
CPAs
on Boards will provide nonprofit board members and CPAs
through New York State with training about effective nonprofit
governance, the roles and responsibilities of board members,
and the fundamentals of nonprofit operations and accounting.
Program participants will have the option of attending training
sessions by the Council of Community Services or sessions
planned in cooperation with NYSSCPA chapters. The program
will also match CPAs with nonprofit boards that are proactive
in raising the level of their financial integrity.
Rewards
That Exceed Expectations
Visit
our website (www.nysscpa.org)
in the coming weeks for more information. CPAs that make
time to serve on nonprofit boards say that the rewards exceed
their expectations. In addition to helping to improve their
communities, they find that their networks are enlarged,
their horizons are broader, and their professional skills
are sharper because they’re using them in different
ways. My hope is that the expectations of the organizations
sponsoring this program will also be exceeded. Returning
to de Tocqueville: “As soon as individuals with a
cause have found one another out, they combine. From that
moment, they are no longer isolated people, but a power
seen from afar, whose actions serve for an example, and
whose language is listened to.”
Louis
Grumet
Publisher, The CPA Journal
Executive Director, NYSSCPA
lgrumet@nysscpa.org
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