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NAO publishes review on due diligence for donation management

NAO publishes review on due diligence for donation management

The National Audit Office has published a review on , looking at the risks associated with accepting donations, and associated best practice.

The NAO’s Due Diligence Processes for Potential Donations focuses on museums and galleries, and reviews the systems and policies relevant to donations management in those for which the Department for Digital, Culture, Media & Sport (DCMS) has responsibility.

The report summarises the legal, financial, reputational and dependency risks associated with income from donations, which it says ‘present different risks to other sources of revenue and cannot be managed in the same way as commercial transactions’. It also covers the relevant regulation, outlining elements of best practice in three key aspects of managing these risks:

  • Governance, including policies, trustee awareness and involvement and ethics committees;
  • Risk management processes, including due diligence, decision-making procedures, record-keeping and resourcing; and
  • Staff and other stakeholder management, including training and engagement with donors.

The review found no evidence of a significant inappropriate donation being accepted in the sector or of a breach of money-laundering legislation.

It found that overall there was good understanding of the issues and risks related to donations management. The extent to which this understanding had been developed into formal procedures and processes varied however, and ‘did not always reflect actual practice, either through being out of date or being insufficiently detailed. There was also a lack of information in the public domain in terms of many of the charities’ ethical positions on fundraising and donations’, and scope therefore for museums and galleries to adopt more of the best-practice procedures and to learn from leaders in the sector.


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Melanie May is a journalist and copywriter specialising in writing both for and about the charity and marketing services sectors since 2001. She can be reached via

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