Last month, I examined notions about Sarbanes-Oxley principles being extended to non-profits.
Now a new study from The Urban Institute reveals why extending it into the non-profit sector would be difficult. On another reading, next to impossible.
The study, Nonprofit Governance and the Sarbanes-Oxley Act shows that non-profits' adherence to Sarbanes-Oxley varies considerably for different provisions, and between non-profits of different size.
The biggest gap was in audit committees. Only one in five had a separate audit committee, and about half the organisations (51 per cent) said it would be difficult to comply with a law that required them to have one. Furthermore, bringing in a law prohibiting them from extending loans to directors would be useless as few did it now.
What the study does confirm, however, is the obvious point that seemed to escape the US Government when Sarbanes-Oxley was brought down in 2002.
Like the for-profit sector, the world of non-profits is varied and multi-dimensional with many different types of non-profits serving different constituencies.
Hopefully, if Sarbanes-Oxley was ever extended to non-profits, the politicians will not repeat the mistakes of four years and adopting a one-size-fits-all model.
no comment untill now