It might sound strange but the preparation for Audit or Assurance Review must be centred around the Balance Sheet. The procedure here Is to have a systematic review of the Balance Sheet.
Therefore, to prepare for your audit or assurance review, the main tasks are to:
- Review, check, correct all Balance Sheet accounts
- Reconcile and provide documentation, proof/evidence that the balance of each account is correct.
This means that EVERY ACCOUNT In the BALANCE SHEET must be reconciled and the closing balance agreed by relevant supporting Information, such as:
- correspondence documents, spreadsheets,
- third party certificates,
- bank or other Institutional statements contracts and agreements
- tax Invoices
- board or other management meeting minutes and motions
From an auditor perspective, the Profit or Loss of an organisation is just the difference between the previous year end and the current year end.
Generally, the various sections of management focus on the P&L during a period and often manage It relative to the Budget. There Is close scrutiny of the P&L often with oversight by particular groups, departments or committees. Analysis by organisational units, such as:
- trading activity,
- as well as analysis of particular accounts such as:
- account groups
- all cash related accounts for the cash flow
Click here to access our free updated Audit & Assurance Review Preparation Checklist to assist you in the process.
Your church has a December year end?
For some churches the financial year started in January and for others It Is about to start. In both situations, preparation Is the key to a successful Audit or Assurance Review.
During the year It Is helpful, if not essential, to go through the bookkeeping and general accounting by following the standard procedures and ensuring adherence to the organisation’s policies. These simple practices will set you up to have a smooth preparation for the year-end processes.
For assistance in either you preparation for, or use of, the Audit Checklist contact the Benkorp team: [email protected]
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