Charity Spending in Spotlight Again
Spending by charities is in the spotlight again with media attention focused on the Portland Hotel Society, a Vancouver-based not-for-profit agency serving people with serious mental illness and addictions. The British Columbia government has released an audit report that reveals how the management and staff of the agency spent thousands of dollars on lavish hotels, limousine rides, expensive dinners and trips. Government pressure has resulted in the resignations of the board of directors and senior managers.
We highlight this case not to suggest that there are problems of the same magnitude in The Salvation Army. Fortunately, we have a strong policy regime that is based on the underlying principle of moderation so that many of the issues raised in the BC case would not happen in our organization. That’s the good news.
The bad news is that these types of cases focus the public’s attention on spending by other, similar organization, both charities and not-for-profits. Within an organization as large as the Army, with almost 11,000 staff across Canada, there are always going to be situations where our spending will come under scrutiny. Absolute and uncompromising adherence to the Army’s policies is essential to protect us from the kind of embarrassment that other organizations have experienced.
The Territory’s Staff Expense Policy (Operating Policy #3409) outlines the types of expenditures for which officers, employees and volunteers may be reimbursed and the limits on those reimbursements. Everyone should be thoroughly familiar with this policy. In particular, management staff at THQ, DHQs and ministry units who authorize expenses must ensure that they are in full compliance with this policy when approving claims on behalf of others, as well as having a full understanding of the Expenditure & Payment Policy (Operating Policy #3410).
Do we have the same problems experienced by the Portland Hotel Society? No, but there is room for improvement: in internal audits conducted over the last four years, significant findings in a large number of ministry units include: expenses not adequately supported; no evidence of approval for expenditures; cash not adequately segregated or secured; and petty cash funds not adequately controlled or reconciled.