Internal Controls And Compliance Of The Metropolitan Council

1050 Words5 Pages
1. Strengthen oversight should have come from the board of directors as they were ultimately responsible for the oversight of the Metropolitan Council. Rapfogel did not exercise duty of prudent care, which requires directors to exercise responsible decisions in good faith. Also, the duty of loyalty requires directors to avoid acting in any manner that may harm the nonprofit or results in their personal financial gain. A board audit committee would have provided oversight of the financial management process, while strengthening the system of internal controls and compliance with the law. According to the case study, Rapfogel’s wife Judy was the Chief of Staff to New York State Assemblyman Sheldon Silver and the Met Council received million dollar grants from the Albany legislators, which was a conflict of interest and no one reported it. Conflict situations include participating in the provision of a contract to a business associate, taking a gift from a developer, participating in a grant to a client, hiring or promoting a family member (nepotism), and using government equipment or confidential information for personal purposes (Wechsler, 2012). A whistleblower policy would have enabled employees and board members to report violations of code of ethics or suspected violations of law or regulations that govern the organization. Banning Met Council from funding political campaign contributions and/or fundraisers would have avoided the political entanglements. Also, a
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