For many business leaders, the thought of a nonprofit audit can be a daunting one. However, it’s important to remember that audits are a normal part of nonprofit operations and shouldn’t be feared. In fact, a successful audit can help instill confidence in your organization and provide valuable insights for future growth. In this blog post, we’ll explore what auditors request, how a nonprofit organization can prepare for an audit, why choosing the right CPA is so important, and provide some audit insights and tips to help you prepare for your next audit.
What do auditors request?
During an audit, the auditor will request a variety of documents and information from your nonprofit organization. This can include financial statements, bank statements, invoices, receipts, contracts, and other supporting documentation. The auditor will use this information to gain a thorough understanding of your organization’s financial position and to ensure that your financial statements are accurate and in compliance with accounting standards.
How a nonprofit organization can prepare for an audit
It’s important to be proactive in preparing for an audit. A few steps that your organization can take to prepare include:
- Establishing an audit committee: This committee can help oversee the audit process and ensure that your organization is prepared.
- Creating an audit preparation checklist: This can help ensure that all necessary documents and information are gathered in advance of the audit.
- Reviewing financial statements: Ensure that your financial statements are accurate and in compliance with accounting standards.
- Addressing any issues in advance: If there are any known issues or concerns, address them in advance of the audit.
Why choosing the right CPA is so important
Choosing the right CPA is critical to the success of your nonprofit audit. A CPA with experience working with nonprofit organizations can help ensure that the audit is conducted in a thorough and efficient manner (which will not only save you valuable time, but money!). They can also provide key insights and recommendations for future growth.
Tips to help you prepare for your next audit
- Keep accurate records: Ensure that all financial records are accurate, up-to-date, and organized.
- Communication is key: Communicate with your auditor throughout the audit process to ensure that everything is running smoothly.
- Be prepared for surprises: Auditors may uncover issues or areas for improvement. It’s important to be prepared for these surprises and to work with your auditor to address any issues.
- Don’t fear the audit: Remember, audits are a normal part of nonprofit operations and shouldn’t be feared. A successful audit can help instill confidence in your organization and provide valuable insights for future growth.
Alexander & Williams CPA is a team of skilled industry professionals who specialize in efficient audit and accounting services. Their services can assist you in being more prepared for audits, and they can provide valuable guidance on whether your nonprofit would benefit from an independent audit or if there are alternative solutions to consider. Whatever the case may be, Alexander & Williams’ CPAs allow you to focus on what you enjoy while they concentrate on what they do best: helping businesses thrive financially.