Protect Your Youth Sports League From Fraud
A children’s organization may be the last place you think of when it comes to fraud. Unfortunately, however, it’s an area that’s especially vulnerable. Since cash transactions are common, and coaches and board members are typically volunteers, there are many areas of risk. Here’s what you can do to keep your organization secure.
By far the most important step leagues can take is to segregate duties. This means that no single individual receives, records and deposits funds coming in, pays bills and reconciles bank statements.
So one person might handle deposits and payments, another would receive and reconcile bank statements and a third would monitor the budget. Also, every payment (or at least payments over a certain threshold) should be signed by two individuals. If your league has credit or debit cards, someone who isn’t an authorized card user should be assigned to review the statements.
Some simple steps
Other procedures can help prevent fraud. For example, if your league still uses paper registrations and accepts payment by cash or check, investigate electronic payment options. Cash can be pocketed in the blink of an eye, and checks can be diverted to thieves’ own accounts. But with online registration, payments are deposited directly into the league’s account.
Also, keep an eye on your league’s treasurer if you notice any specious activity. Since this position allows for the easiest access to funds, people in this position have been statistically more likely to commit fraud. No one person should stay in the treasurer position for more than a couple of years. If funds are available, your league might consider hiring a part-time bookkeeper who will report directly to the board.
The treasurer should submit a report to the board of directors for every board meeting, with bank statements attached. And your board should receive and review financial reports at least quarterly — including when the league isn’t in season.
Contact us for more information.
For our thoughts on the industries we serve and firm updates, follow us on LinkedIn.
Ready to Connect?
We deliver personalized, expert services. Find out what we can do for you.