Regulation in Nonprofit Organizations

Nonprofit Governance At Its Worse (Mike Burns, http://nonprofitboardcrisis.typepad.com/mbblog/2011/04/nonprofit-governance-at-its-worse.html) tells us a story about the misspending in nonprofit organization's (school) funding. My question is why it is so late to find out (after a new executive comes)?

Staff, teacher, and parents never try to exam the school's annual report in the past years. I find that closer relationship may lead to ignore the big problems. Not every nonprofit organization needs to publish their report authorized by independent accountant. The staff or existing clients play a more important role in this condition. They participate in organizations' daily operations and know more than a new user or donor.

In Charity Navigator project, I am thinking whether relative departments could require them to publish the annual staff evaluation or clients evaluation. We only could find the feedback from the organizations website or report, but hard to find the first hand feedback from the staff, clients or users.