There are few people who would call an audit fun, but the fact is, if you run a non-profit, audits do happen.
So, what do you do to prepare your non-profit for an audit? What is the process and what exactly do you need to know in advance?
Here are some things to keep in mind if your non-profit is facing an audit. Read on:
One of the first things you need to do if your non-profit is facing an audit is to prep your staff. Keeping the lines of communication open and setting concise expectations at the outset is key to a smooth process.
Depending on the size of your organization, you will likely need to appoint an employee (or more) to be the main communicators with the auditors. If you have this process in place, there should be no issue with duties or responsibilities so make sure to clearly define roles and responsibilities at the outset!
You will also need to make sure you have all the documents and accounting data available and in an organized manner. The auditors should have a list of what they will need to examine, but it generally includes: Ledgers, bank statements, grant funds and statements, payroll and other employee information (especially about timekeeping) and more.
The auditors might also make visits to your office or headquarters and want to talk to your employees. Make sure they have a space to work and access to personnel and documents.
Keeping everything organized and orderly is one of the keys to a successful non-profit audit, so even if you aren’t facing one, now is the time to get your financial house in order!
And after the audit is complete, you might have a better picture of what to improve upon in the future, so be sure to see this as a time of change and growth as well, and not just something that is time-consuming or burdensome.
If your non-profit is facing or has faced an audit, we have systems that can help. Contact us today!