Nonprofit agencies in Oklahoma are joining others across the
nation as they implement new accountability standards in a world of
The American Competitiveness and Corporate Accountability Act of
2002, commonly known by the names of the act's authors, U.S. Sen.
Paul Sarbanes, D-Md., and U.S. Rep. Michael Oxley, R-Ohio, was
passed in response to the corporate and accounting scandals of
Enron, Arthur Andersen and others. Although the act is mainly
directed toward American publicly traded companies, two provisions
apply to all corporate entities, including nonprofit organizations.
The Sarbanes-Oxley Act has forced nonprofits to analyze board
practices and internal operations. Non-profit advisers and watchdog
organizations are advising nonprofits to take seriously the
implications of Sarbanes-Oxley for nonprofits, according to Monica
Swink, a local certified public accountant who works exclusively
with nonprofits in Oklahoma, consulting on financial issues,
including financial reports, systems and board education on
The climate for publicly traded organizations demands more
accountability and transparency in financial reporting and
operations, she said, and that climate also demands more
accountability for nonprofits in the same areas.
Determining the results expected within the for-profit industry
and implementing appropriate changes in their governance and
monitoring systems will be crucial in preventing regulations for the
same provisions for nonprofits. Self-regulation is always more
powerful than regulated compliance with laws, Swink said. Most
organizations I deal with understand the importance of transparency
and accountability within the nonprofit sector and are interested in
how to ensure they are fulfilling the spirit of the new regulations.
Swink said she has witnessed an increased interest in Sarbanes-
Oxley from nonprofits since it was signed into law on July 30, 2002.
National nonprofit associations and consulting firms have
encouraged nonprofits to review the provisions and to proactively
implement any changes necessary to ensure the nonprofit industry
measure up to the standards presented in Sarbanes-Oxley, as much as
possible. Accounta-bility is key to the survival of nonprofits, and
implementing the key provisions of the Act will only improve the
accountability of nonprofits, she said.
Lynn Kickingbird, a local nonprofit consultant, said while she
hasn't received any specific requests regarding the Sarbanes-Oxley
Act, she has seen a sharp increase in requests for board training
about legal responsibilities and revising bylaws. …