6 Quick Tips to Get Ready for Your External Audit From Foster Results
Foster Results has published a series of articles to help nonprofits get ready for their annual audit. Not sure what comprises an effective audit committee? Learn more here.
Here are six quick tips to get your started:
- Begin by creating sound financial policies that document the internal controls at your organization
- Understand best practices for Finance/Audit Committees
- Document how you allocate costs to your programs and track your staff time according to management/general, fundraising and program costs
- Have Board minutes organized so that the auditor can easily review them and maintain a current listing of Board members and terms
- Look at accounts receivable at least quarterly to follow-up on old accounts and ascertain if the amount will be received or if it should be written off
- Maintain current, accurate information about fixed assets such as purchase date, depreciation method, serial numbers and location of fixed asset in your organization
The most important take away is — if you follow processes and procedures throughout the year that are considered good practice, then getting ready for the external audit will be a matter of pulling things together versus putting undue pressure on you and your staff.