Congratulations on one other profitable monetary audit! Making it by means of with minimal complications is a testomony to planning, partnership together with your Program group, and powerful inner processes and procedures.
Now that every one the excellent entries have been cleared and studies 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 shows are sometimes mind-numbingly boring. You’ve gotten 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 means of the report, in the end saying that you just have been cooperative, and the opinion is clear.
All in all, it’s anticlimactic for everybody. Throughout the 12 months, you’ll seemingly have your personal administration studies that target programmatic and monetary outcomes. The presentation for the GAAP monetary assertion will get pranced out every year 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 every year, the time must be spent on the fundamentals of the assertion as a substitute of the small print 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 throughout the audit presentation.
Sharing Your Nonprofit Audit Report Format Extra Than As soon as a 12 months
What when 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, govt management, and lending establishments with a real GAAP monetary assertion. Any accounting software program price its salt can present the administration studies and GAAP monetary assertion immediately from the software program—not by means of a labyrinth of Excel spreadsheets.
Presenting these studies extra repeatedly helps your board members and management really feel extra comfy with the knowledge, as a substitute of attempting to recollect every year why it may be completely different out of your common studies.
3 Causes to Share GAAP Monetary Statements Quarterly
Higher Displays Your Group: This method supplies a possibility so that you can make it possible for 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.
Gives Extra Transparency: Presenting the studies quarterly additionally supplies your management with the power to talk with continuity throughout the 12 months in a constant method. Your Finance Committee members seemingly know your bankers and funders in the neighborhood. It serves you properly to arm your advocates with GAAP outcomes and your administration studies. 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 supplies a discussion board for the Board to speak concerning the impression of those monetary outcomes and developments.
The auditors even have a possibility to talk to your program outcomes and inner controls. This can be a win for everybody. The Board can really feel knowledgeable and comfy representing you to their constituents and program management can see how the audit reinforces the nice 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 study 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 best way to Ace Preparation for Your Monetary Assertion Audit.
This put up was initially posted in June 2017 and up to date in June 2023.