Current Legislative Environment for Nonprofits
U.S. Senate Finance Committee Hearings on Nonprofit Accountability, June 2004 Although the features of the SOX legislation may on the surface appear to have more impact on the private sector, the public sector (i.e., government) push for greater accountability includes the independent sector (i.e., the nonprofit world) as well. This section discusses the recent United States Senate Finance Committee June 22, 2004 hearings on Charitable Giving Problems and Best Practices, along with the highlights of recent California “Sarbanes-Oxley clone” legislation (SB1262) signed into law on September 29, 2004. The common theme of the testimony of witnesses, the Congressional staff papers, and the California “Nonprofit Integrity Act” (SB1262) is that nonprofit organizations have, through fiscal and governance abuses, diminished public trust. Public outrage fueled these Congressional hearings on nonprofit abuses. Further reports of financial and governance mismanagement appear on an almost daily basis—sometimes even in the “Food” section of the newspaper.1
Internal Revenue Service Commissioner’s Testimony As part of the Senate Finance Committee’s June 2004 hearings on nonprofit accountability, Mark W. Everson, the commissioner of the IRS, provided some very sobering testimony on that agency’s plans for oversight and enforcement of the nonprofit sector. The following excerpts of Mr. Everson’s testimony should leave no doubt about the IRS’ short-term agenda for bringing about nonprofit accountability [Sarbanes Oxley for Non Profits, Peggy M Jackson]
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