Data Analytics Can Help Save Your Non-profit Company from Fraud

One of the great ironies in the corporate world are non-profit and charitable organizations accused of crimes. This rings even more true when that crime involves fraud. Although some organizations willingly engage in fraudulent acts, others are victims of unseen crimes committed by disloyal employees.

Regardless of the cause, fraud within a non-profit organization is still a crime, not to mention disgraceful. How can these companies keep fraud outside of their walls? They can do so by means of proactive data analysis.

Fraud Hurts Non-Profit Organizations More Than For-Profit Corporations

A loss of revenue is just the beginning of trouble for a non-profit company. In fact, it isn’t the biggest consequence of the crime. There’s a public perception among the masses that “for-profit” organizations likely engage in devious practices (even if this isn’t necessarily true).

Charitable organizations, however, in the eyes of many, should have no such crimes attached to their name. That’s why these companies face even more scrutiny and criticism when fraud allegations befall them. This often leads to a severely tarnished reputation.

Yet still, the consequences go deeper. Charities provide services that are essential to the health, safety and livelihood of many people. These include quality-of-life programs, services for the homeless, funding for underprivileged children and donations for those dealing with life-threatening illnesses.

When fraud affects a non-profit organization, the loss of funds that follow may result in a loss of these services, which could lead to devastating effects for some families. Also, the damaged reputation of a non-profit company follows its employees and staff, long after they have left and even if they weren’t a part of the crime. 

Data Analytics to Safeguard Non-Profits from Fraud 

It’s not always possible to prevent employee fraud within an organization, but it’s certainly within a company’s reach to detect it quickly. This is possible when an organization circles in on a specific set of data analytics. These analytics are the data, the numbers behind basic operations such as accounting and transactions. These data sets will vary from company to company, but there are some starting points for every business to consider.

Ultimately, what you’re searching for when reviewing your data are inconsistencies. A rule of thumb is this: if the numbers match, there’s nothing fishy to catch. But if the numbers don’t align, then you need to pay them some mind. 

  • Data matching – With this technique, you examine payroll data to see if there are deposits from two different individuals going into the same bank account. This can be done to catch inconsistencies involving names, addresses and phone numbers.
  • Sounds “Like” Function – Some fraudsters hide behind names that are not exactly theirs, perhaps by using names close to their own or by using alternate spellings. A “sounds like” function can help you detect these names if they don’t seem to match a document.
  • Duplicate testing – As its name suggests, this form of testing searches for things such as duplicate invoices and transactions. It won’t tell you immediately if these duplications are the result of error or fraud, but you’ll at least know that there’s problem to look into.
  • Gaps – Missing data sequences could be a red flag that someone is taking advantage of your system. Perhaps, they are doing this to cover up stolen time, funds or products. This is a pretty glaring issue, so it’s something you can spot quickly with specific tools.

How GLAnalytics Can Help Non-Profit Organizations

Fraud within non-profit organizations can bring more implications than typical for-profit organizations. As mentioned earlier, a damaged reputation can bring about the cancellation of essential services, which may result in serious consequences for those who need them.

That’s why nonprofits need to adopt a proactive approach to catching fraud. These crimes almost always leave a trail behind, and establishing the right set of data analytics can help you see the tracks.

GLAnalytics’ cloud-based software allows you to dig deeper into the numbers behind your business. With these insights, you can match them with key records and make comparisons to spot figures that don’t match. These tools allow you to take a proactive position against fraud that can save your company from major hassles in the future.

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