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The Sarbanes-Oxley Act, which was introduced in 2002 to reduce the risk of corporate fraud, may soon affect nonprofit organizations across the country, according to the American Institute of Certified Public Accountants (www.aicpa.org.) So far, 14 states have introduced Sarbanes-Oxley related legislation, often to strengthen penalties and to add nonprofit organizations to the mix.

How can you prepare for possible mandated requirements? "Be sure those on your board are qualified to serve and well-versed in their roles as fiduciaries," says Sammi Soutar, board member of the AMC Institute (www.amcinstitute.org). He suggests hiring an Association Management Company (AMC), which provides management support to nonprofits, adding a layer of control and accountability.

One of the best things nonprofit leaders can do now is to conduct an operational audit or, at minimum, review policies and practices, such as accounting and recordkeeping, to ensure compliance with current law, Soutar advises. Also be sure your board has directors' and officers' liability insurance with broad coverage. Such insurance is vital to safeguard your organization against claims alleging mismanagement. See "Boards Must Change the Way They Do Business" in Nonprofit World, Vol. 21, No. 4, www.snpo.org.