Let's be honest: when we read about the treasurer running off with all the cash or the dodgy fundraiser with the new car, how many of us can be sure the same thing couldn't happen in our organisation?
We all know not to sign blank cheques, but many other small errors could slip past us. If someone claimed £96 instead of £69 for their cable TV subscription, who in your charity would spot it? Could your chief executive get a new desk for £2,000? If you don't have a budget approved by the trustees, what's to stop them?
Or how about a new kitchen? The purchase has been agreed and recorded in the accounts, the invoice is filed and the treasurer has let the committee know all is well. But there is one little problem: the kitchen has been installed in the treasurer's house.
It doesn't take long to think about, discuss and draw up a plan for how each of your standard financial procedures should be carried out, and it could save a lot of pain later on. It isn't a case of not trusting people; it's about accepting that it's in everyone's interests to be open and accountable.
Your policy should cover all areas, from budgets to expenses, petty cash and even debit cards. Try to involve more than one person in each process - one person spends the petty cash, another keeps the tin; one writes the cheques, other people sign them.
Finally, once you've approved your procedures, don't forget to make sure they work and review them regularly.
John O'Brien is chair of the Community Accounting Network and chief executive of CA Plus