Tips on charitable fundraising

As the current downturn stubbornly refuses to loosen its grip on the economy, it´s more important than ever that charities put controls in place to ensure that their fundraising activities are transparent and beyond reproach. No organization can afford the unwelcome attention that a poorly-planned or misleading campaign might attract.

We discussed a new CRA guide on charity fundraising in Volume 2, Issue 6 of Inside Internal Control. Now the Ontario Public Guardian has released a very useful Charities Bulletin, Charitable Fundraising: Tips for Directors and Trustees that reminds those responsible for the governance of charities that they are responsible as fiduciaries to the public for all donated funds, including funds collected by commercial fundraisers. Click here for this useful document.

And for an article discussing this Bulletin from Terrance S. Carter of Carters Professional Corporation, a full-service law firm with a focus on charities and not-for-profit organizations, click here.

With more than 25 ready-to-use policies, and expert commentary about each of them, Not-for-Profit PolicyPro features chapters dealing with governance and financial management issues.

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Will competition class actions become more common?

As a recent article by Donald B. Houston and Emily Rix of McCarthy Tétrault discusses, the answer to this question hinges on the outcome of two class action applications, one in B.C. and the other in Ontario. Lower courts in these provinces have come to different conclusions about the requirement for plaintiffs to demonstrate, at the certification stage, a viable method of dealing with "pass-through issues" (where members of the proposed class have conflicting interests, and liability may not be a common issue). Both cases are currently under appeal, so it´s obvious that the law is not settled on this issue.

Adding to the uncertainty is the new section 45 of the Competition Act, which will come into force in March of next year. The new section makes a conspiracy to fix prices a per se offence, where you need only prove the existence of a conspiracy, not that any damages resulted from it.

Click here for a link to this interesting article.

Update release 2009-05 of Finance and Accounting PolicyPro (FAPP) focussed on the recent changes to the Competition Act in policy GV 4.06 - Competition Law. For more information about FAPP and to try a 30-day trial, click here.

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Ponzi scheme depended on lack of internal controls

A complete absence of even the most basic internal controls in the office of alleged fraudster Earl Jones made it simple for him to misappropriate the money that his clients believed was being securely held in trust.

According to a story in the National Post, the employees in Mr. Jones´s office lacked the training and experience needed to do their jobs, and routinely withdrew large sums of money from a single all purpose bank account, in which all the funds of Mr. Jones´s clients were kept, instead of the separate, segregated accounts that the law demands. Christmas bonuses, cash payments to part-time employees, money to buy hockey tickets and large cheques to Mr. Jones´s wife were withdrawn from this account, even though she was at no time an employee of the organization. Deposits into the account were tracked in a ledger, but reconciliations between the ledger and the account were done by Mr. Jones, when they were done at all.

Establish essential accounting controls and prevent fraud with Finance and Accounting PolicyPro. Click here to order your 30-day free trial today.

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Omnibus bill introduces changes for charities in Ontario

Bill 212, the Good Government Act 2009, received third reading in the Ontario legislature on December 2. It´s an omnibus bill that affects dozens of provincial statutes, but the charitable sector is concerned with amendments to the following laws:

• the Charitable Gifts Act, which after more than 30 years of lobbying has been amended to allow charities to own a for-profit company. The Act restricted Ontario charities to owning no more than 10% of a for-profit company, the only province in Canada to do so
• the Charities Accounting Act, which has been amended to give all charities the right to own land, a right that had only been enjoyed by hospitals, universities and religious institutions (all other charities were compelled to dispose of land they were not directly occupying after seven years). This means charities can hold land and use the income for their charitable work, even if they are not occupying the premises directly

For the full text of the Bill, click here. To read commentary about the changes from the Ontario Nonprofit Network, click here. And, finally, to read an article about Bill 212 from Terrance S. Carter of Carters Professional Corporation, click here.

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Update on ECPA

We´ve been tracking the controversial Electronic Commerce and Protection Act all year in Inside Internal Control. Now that the Bill has moved from the House to the Senate, concerns have arisen once again that the provisions of the tough anti-spam Bill will be softened.

The Industry minister says that his "expectation is that the Senate will act on this legislation immediately to ensure protection for Canadian consumers." However, as noted in Michael Geist´s blog, there is reason to believe that the forces that opposed the Bill in the House will take another run at it in the Senate.

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New workplace violence guide now available

We are pleased to announce that the latest First Reference guide, Workplace violence and harassment prevention - A practical guide for employers is now available. You can either order the guide for $79 or receive it free if you sign up for a no-obligation 30-day trial of any of the editions of The Human Resources Advisor or Human Resources PolicyPro.

Workplace violence and harassment prevention - A practical guide for employers will help you understand the definition, jurisdictional obligations, and consequences of workplace violence, harassment and bullying. It is also an indispensable guide to building the policies and procedures that are required under provincial law in most jurisdictions. The 48-page guide includes the following ready-to-use documents:

• A sample workplace violence policy
• A sample violent incident report form
• A sample violent incident investigation checklist
• A sample workplace violence risk assessment form
• A sample violence in the workplace compliance checklist

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Season´s greetings from First Reference

The staff at First Reference wishes everyone a very happy Holiday Season and all the best for the New Year!

First Reference will be taking a break for the holidays. Please note that our offices will be closed from December 24, 2009 at noon to January 3, 2010 inclusive. Our offices and services will reopen on Monday, January 4, 2010.

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About Inside Internal Control

Editor: Colin Braithwaite, Managing Editor, PolicyPro.

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