Blockchain presents many opportunities for businesses across all sectors, not just the financial sector and security, but also for not-for-profits, charities, and NGOs.
To find out more about those opportunities for not-for-profits, charities, and NGOs, we talked to the University of South Australia senior lecturer in accounting, Dr Sanjaya Kuruppu.
Kuruppu’s research explores accountability issues, and how to improve organisational governance and sustainability within non-governmental organisations and in large companies.
How can charities and NGOs use blockchain to support their fundraising or mission-based objectives?
There has been much hype about the blockchain in recent years because of the spectacular rise of cryptocurrencies like Bitcoin.
However, blockchain technology (a subset of distributed ledger technology) has multiple applications because it: enables immutable, accurate and encrypted digital records to be created which protects data integrity; enables instant sharing of information; and opens possibilities for continuous auditing of this information.
Bitcoin is a public chain of transactions, but this raises concerns about privacy and confidentiality, particularly in relation to sensitive business transactions.
There is now more momentum in exploring the potential use of ‘permissioned chains’, which restrict the users that have access to various sets of information. These introduce the possibility of triple-entry accounting, a novel development for the accounting profession. Organisations can automatically reconcile standard double-entry accounting entries with other entities, like suppliers or customers with a ‘third ledger’.
This third ledger is a permissioned blockchain which enables transactions to be securely shared with trusted third parties such as auditors and potentially the Australian Taxation Office (ATO). It could transform the way that various organisations can interact with each other and automate…