It’s Time to Test Remote Operations – Conduct a Drill

March 12, 2020

By Mike Batts, CPA

 

Now is the time for all organizations of all types to ensure that employees can perform key financial operations functions working remotely…e.g., from their homes.  It is also the time for nonprofit organizational leaders to ensure that their online giving operations are fully functional and working well.

I’m not going to attempt in this article to address the many potential implications of further spreading of the coronavirus.  I’ll leave that to the experts on the subject matter.  I do want to address the real considerations of a church, charity, ministry, school, or other nonprofit organization being able to continue critical financial operations in the event that key members of the organization’s financial operations team (not to mention the whole team, or the whole community surrounding the organization’s offices) are quarantined or subjected to a lockdown for a period of weeks.  Having the ability to continue conducting key financial operations in a sound manner is not a luxury…it is a necessity.  Organizations that fail to prepare for the possible need for having team members carry on these key functional areas remotely could find themselves in a financial crisis quickly.

 

Preparing for remote operations

Key functions

Key financial operations functions include, but are not limited to, general accounting, payroll, accounts payable, accounts receivable, contributions processing, and banking.  Team members who carry out or facilitate each of these functions should be able to perform their duties completely remotely.  Organizations that have not had team members perform such functions remotely in the past should develop specific protocols for doing so.  With the help of the organization’s IT team, remote desktop/terminal server applications can typically be configured to permit employees with an internet connection to access the software they regularly use that resides on the organization’s servers.  (Organizations whose servers are cloud-based should already be well-situated for remote work, subject to other considerations described later in this article.)  For cloud-based applications, the worker can typically work from anywhere with an adequate internet connection – because cloud-based applications do not rely on use of the organization’s servers.

Online giving

If there is any doubt about the functionality of the organization’s online giving function, it should be fully tested and fixed as needed.  Inasmuch as possible, nonprofit organizations should strive to make online or app-based giving as easy for donors as purchasing an item on Amazon.

Cloud-based accounts payable management systems

For issuing payments to vendors and others, this is the time for organizations not already doing so to consider using cloud-based accounts payable management applications (such as Bill.com).  Well-engineered cloud-based accounts payable management systems facilitate payment of bills both electronically and by check (the company offering the software application actually prints and mails checks).  Additionally, well-engineered applications have internal control features that help to ensure that the proper people in the proper roles approve disbursements (remotely, using the cloud) before they are made.  Quality cloud-based accounts payable management systems are life-changing in their improvements to efficiency and can virtually eliminate the need for printing, signing, and mailing checks.  And truly well-designed systems can actually improve internal controls over disbursements.  It is my recommendation that every organization utilize a well-engineered, cloud-based accounts payable system.

Remote deposits

The organization’s system for making remote deposits should be functioning well.  In the event that an organization has not established remote deposit capabilities with its bank, now is the time to do so.

Inbound phone calls

Consideration must be given to handling inbound phone calls.  Organizations with internet-based (IP) phone systems can likely easily cause inbound phone calls made to an employee’s extension to be redirected to his/her cell phone.  Depending on the organization’s phone system, applications may also allow workers to make calls from their cell phones that reflect the organization’s main phone number in the Caller ID of the party to whom the call is made.  Organizations without the ability to redirect inbound calls to employee cell phones should consider alternatives, including protocols for employees to retrieve voice mail messages at certain intervals (e.g., hourly).

Provide necessary equipment and supplies

In order to operate effectively with all workers remote, organizations will need to ensure that workers have the necessary equipment and supplies at home to perform their duties completely.  That may mean supplying some workers with computers, additional monitors, printers, scanners, office supplies, etc.  Ideally, the need to print documents remotely will be minimal.  It is more likely that a worker may need to be able to scan documents (see the section below addressing the handling of physical documents.)

For low-volume printing, a printer such as the HP OfficeJet 250 All-in-One Portable Printer with Wireless & Mobile Printing may be a good choice.  (A carrying case is available to facilitate portability.)  For scanning, our firm uses and recommends Fujitsu ScanSnap scanners, which are available in a variety of sizes and types.

If the organization’s remote deposit process utilizes special equipment, ensure that the equipment can be relocated to an appropriate alternative location (see the section below addressing the handling of physical documents.)

 

Testing remote operations – conduct a drill very soon

Organizations should test the ability of all employees performing key financial functions to work remotely in order to ensure that the process is functional and will work well when needed.  That means requiring each person who could be called upon to work remotely to test their access to all servers and applications they will need in order to perform their duties and to confirm specifically that their remote access is working well.

I recommend that organizations conduct a work-from-home drill very soon to test the viability and effectiveness of key processes and functions.  After taking appropriate steps to prepare for remote operations as described in the preceding section of this article, select a day and declare it “work-from-home day.”   Require all workers performing key financial and operational functions to work from home.  Observe what works well and what doesn’t.  Fix what doesn’t.  If necessary, do it again until your organization’s leaders believe that the remote operations plan is adequate and working in a manner that is acceptable for your organization.

 

Handling physical documents

Some financial operations functions that involve the transfer of physical documents (such as checks) require special attention.  For incoming checks (e.g., for contributions) received by mail, appropriate arrangements must be made to gather, process, and deposit the checks.  If workers are under quarantine, the logistics of such an operation could be challenging…and must be addressed case-by-case.  Depending on the circumstances, solutions could include temporary mail forwarding to a secure location not under quarantine (e.g., to a campus of the organization in another town not under quarantine or to an unrelated organization in another town willing to assist the organization experiencing quarantine).  Another possibility is mail forwarding to any location (including, possibly, a residence) where at least two unrelated people can collect, process, create a record of, and deposit the incoming checks.

 

Don’t disregard internal controls

Emergencies can create scenarios where it is tempting to disregard fundamental internal controls.  Disregarding fundamental internal controls during an emergency or crisis is not wise, and can create opportunities for misappropriation.   A better approach is to carefully rethink internal controls and apply a reasonable, risk-based approach to financial activities that fits the situation.   A nonprofit leader once told me how his organization deals with delivering chainsaws to people after a hurricane.  “We just hand out chainsaws to anyone who comes and asks for one,” he said.  “We don’t ask questions…we just hand them out.”  Such an approach may be very appropriate for distributing chainsaws in the aftermath of a hurricane.  But it wouldn’t be wise to stop requiring proper segregation of duties or proper approvals for cash disbursements or payments during a crisis.  If anything, crisis scenarios require more care with respect to internal controls as revenues may decrease and expenditures may increase.  Bottom line – rethink internal controls, applying reasonable and prudent, risk-based safeguards to exercise wise stewardship over the organization’s resources.  (My references herein to the term “risk-based” are intended to communicate the fact that some risks are greater than others…and low-risk processes or scenarios require less internal control attention than higher-risk processes and scenarios.)

 

Other risk-based considerations

Organizations planning for remote operations should apply risk-based consideration in other areas – possibly under the advice of legal counsel.  Areas for consideration would include, but not be limited to, insurance coverages, data security and privacy, and time-keeping records for hourly employees.

 

We’re here to help – with extended hours in the event of a large-scale quarantine or lockdown

For clients of our firm with questions about the matters described in this article, please reach out to us.  We are ready, willing, and able to help.  In the event of a large-scale quarantine or lockdown, we will implement extended hours for accessibility, the information for which will be posted on our website.

We pray that God would reduce the impact of the current pandemic – and that it would be eliminated soon.  And we pray for the great organizations whose calling is to serve others…may God especially bless your important work during this tumultuous time.

 

Neither the author nor BMWL has any financial connection to or interest in the product or service recommendations described in this article.

 

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