Congratulations on one other profitable monetary audit! Making it by with minimal complications is a testomony to planning, partnership together with your Program group, and robust inside processes and procedures.
Now that each one the excellent entries have been cleared and reviews have been pulled, the final step of the nonprofit audit is to current your audited monetary statements and the shiny, clear opinion letter to the board.
These displays are sometimes mind-numbingly boring. You may have spent numerous hours organizing footnotes and grouping the road gadgets on the monetary statements to successfully inform your story. Your auditors march the board by the report, finally saying that you simply had been cooperative, and the opinion is clear.
All in all, it’s anticlimactic for everybody. Throughout the yr, you’ll doubtless have your personal administration reviews that target programmatic and monetary outcomes. The presentation for the GAAP monetary assertion will get pranced out annually like a birthday cake.
The auditors have a duty to make sure that the board understands the GAAP monetary statements and the implications of the opinion letter. In case your board solely sees that format annually, the time must be spent on the fundamentals of the assertion as an alternative of the main points of the audit consequence.
Assist your board really feel empowered to ask educated questions by giving them extra expertise with the GAAP statements all year long, and never simply through the audit presentation.
Sharing Your Nonprofit Audit Report Format Extra Than As soon as a Yr
What should you used your accounting software program to punch out your GAAP monetary assertion and the important thing footnotes on a quarterly foundation? This manner you might be offering your board, government management, and lending establishments with a real GAAP monetary assertion. Any accounting software program price its salt can present the administration reviews and GAAP monetary assertion instantly from the software program—not by a labyrinth of Excel spreadsheets.
Presenting these reviews extra usually helps your board members and management really feel extra comfy with the knowledge, as an alternative of making an attempt to recollect annually why it may be totally different out of your common reviews.
3 Causes to Share GAAP Monetary Statements Quarterly
Higher Displays Your Group: This method offers a possibility so that you can ensure that your GAAP monetary assertion presentation mirrors what is definitely occurring in your present group.
Saves Time: Working the report quarterly avoids the huge rewrite of varied statements inside your GAAP reporting whereas finalizing the audit.
Offers Extra Transparency: Presenting the reviews quarterly additionally offers your management with the power to talk with continuity through the yr in a constant method. Your Finance Committee members doubtless know your bankers and funders in the neighborhood. It serves you nicely to arm your advocates with GAAP outcomes and your administration reviews. You’re sharpening their pencils by giving them the knowledge they should converse in your group’s behalf.
Empower Your Board with an Understanding of GAAP Reporting
Your mind-numbing annual audit report presentation now can grow to be a dialogue! Your board members have had time to see the evolution of the GAAP monetary outcomes all year long. This offers a discussion board for the Board to speak concerning the impression of those monetary outcomes and tendencies.
The auditors even have a possibility to talk to your program outcomes and inside controls. This can be a win for everybody. The Board can really feel knowledgeable and cozy representing you to their constituents and program management can see how the audit reinforces the great work that they do. On the finish of the day, you might be all right here for the mission that your Program group delivers!
To be taught extra about the best way to set your group up for audit success, try our webinar with Paul Preziotti, CPA, Associate, Johnson Lambert, Audit Readiness: The way to Ace Preparation for Your Monetary Assertion Audit.
This publish was initially posted in June 2017 and up to date in June 2023.