Why Your Nonprofit Should Conduct a Data Audit Sooner Rather Than Later (part 2)

Amanda Luzzader

Data audits–what they are, why you should conduct one, and how to do it.

The entire world now runs on data, and this includes nonprofit organizations. In this three-part series of articles, we’re discussing data audits–what they are, why you should conduct one, and how to do it.

In the first part, we defined the data audit and discussed its emergence as a standard business practice. Here in the second part, we’ll discuss why your nonprofit should conduct a data audit and how to get one started.

What are the Benefits of the Data Audit?

As you’ve probably already recognized, the data audit isn’t just something that might provide some incidental or periodic benefits to nonprofit organizations. If a nonprofit is to collect and utilize data effectively and efficiently, the data audit is a practice that must be adopted and embraced.

Time and money savings. After a data audit, it’s likely that time-wasting data collection will be identified. Collecting data without using it wastes money and time–so identify what data you don’t need and quit collecting it.

Less legal and ethical exposure. Finding all an organization’s data and making sure it is safe and secure will reduce the organization’s risk of embarrassing data losses or leaks. The growing legal frameworks that govern the collection, management, and protection of data increasingly insist that data auditing should become a routine practice.

Better compliance and transparency. In the coming years, watch for philanthropic organizations and individuals to begin requiring more transparency and legal compliance with data-related laws and guidelines. Rather than have to “catch up” when a grant-giver requires proof of data integrity and security, start now.

Where to Start?

Other kinds of audits (such as financial audits, asset audits, etc.) already have rules and procedures, some of which are mandated by laws. These more well-known audits likely have personnel assigned to oversee them. The data audit, on the other hand, maybe something new, and your organization may have the task of figuring out how to conduct the data along with actually conducting the audit.

  1. Make personnel assignments. A good first step is to select a member (or members) of the organization who will be in charge of the data audit. Smaller organizations may be able to rely on a single tech-savvy worker or volunteer to take the lead. Larger organizations may need a team.
  2. Find all the data. To audit all of an organization’s data, all of the organization’s data must be at hand. Some organizational data will be simple to locate. This might include intake data, donor demographic profiles, giving histories, and lists or databases containing employees, volunteers, and clientele–the data that you access often and regularly. Other data may be more obscure and may not be presently thought of as data at all. Such items may include old proposals (successful and otherwise) for grants and programs. Other items might include data collected with obsolete methodology (such as old database formats or paper).
  3. Formulate your audit. This step is an interesting one because it amounts to gathering data about your data. Now that your data-auditing personnel and your data trove are ready, it’s time to decide what questions you’re going to ask and how exactly you’ll audit your organization’s data. The example questions above are, as mentioned previously, good openers. Is this data being used? How is this data being used? Other questions might include the following:
  4. Who is the person in charge of this data?
  5. Who can access this data?
  6. Where is the data stored?
  7. Is the data secure?
  8. What laws or company regulations apply to this data?
  9. How much does it cost (or did it cost) to collect this data?
  10. How much to store it?
  11. Why isn’t this data being used?

With your personnel, data, and metrics in place, you’re ready to move forward and hopefully get a better grip on your organizational data. In part 3, we’ll continue the discussion by offering tips on how to audit your data and what to do with the results.

More Articles You Might Enjoy

Didn’t find what you’re looking for?