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Audits and Reviews

Audits

Audits are an investment in the trust and integrity of your organization’s financial operations. Audits offer the highest level of assurance, ensuring that your financial statements accurately represent your organization’s financial position and operations for a specific time period.

Before substantive testing begins, our auditors focus on gaining a thorough understanding of your organization and programs, the organization’s internal control structure and risk assessments. Depending on your specific requirements, there may be a compliance component mandated by uniform guidance or grant covenants.

Financial Audits:

– Provides assurance on the fairness of your financial statements

– Tailored to meet the unique needs of your organization

– Helps maintain compliance with regulatory requirements and grant agreements

Compliance Audits:

– Ensures adherence to grant covenants and legal obligations

 – Identifies areas for improvement in internal controls and procedures

The fee for an audit depends on various factors, including:

1. Funding Sources:

– Multiple grants
– Program revenue
– Fundraising activities

2. Complexity of Balance Sheet:

– Number of mortgages or loans
– Multiple capital leases
– Split interest agreements
– Retirement plans
– Number of fixed assets to be tracked and depreciated

3. Other Considerations:

– Affiliation or subsidiary status
– Special audit procedures required by grant covenants
– Compliance with Uniform Guidance requirements
– Previous audit history and any findings

Choosing the lowest bid for audit services can be tempting, but it often comes at a cost. Quality matters, especially when it comes to audits. A lower-quality audit can lead to significant consequences in the long run, potentially jeopardizing your organization’s reputation and financial stability.

Our expertise extends to specialized audits such as Single Audits for organizations receiving federal or state funds exceeding specified thresholds.

Types of Nonprofit clients we serve:

  • Head Start Programs
  • Federally Qualified Health Centers
  • Volunteer Fire Departments
  • Animal Protection/Human Societies
  • Mental Health Organizations
  • Member Organizations
  • Museums
  • Meat Processing Plants

Reviews

A review is substantially less in scope than an audit and is therefore less expensive. A review includes primarily applying analytical procedures to your financial data and making inquiries of organization management. Through these processes, we develop expectations about significant financial statement account balances. If discrepancies or inconsistencies arise, we conduct further procedures and make adjustments as necessary.

A review provides the user with comfort that the accountant is not aware of any material modifications that would be required to be in conformity with generally accepted accounting principles or other applicable financial reporting framework.

The level of service is determined by your needs and third party requirements. Sometimes a creditor may request an audit but agree to accept reviewed financial statements.

Compilations

A compilation is the lowest level of assurance. A compilation engagement involves assembling financial information provided by management and presenting it in the form of financial statements. Unlike audits or reviews, compilations do not involve verification or testing of the data. Instead, they provide a basic level of assurance that the financial statements are presented in accordance with the applicable financial reporting framework.

If your organization does not have external reporting obligations or the need for assurance services, a compilation may be sufficient to meet your needs.
Compilations are often used for internal purposes, such as management decision-making or tax planning.
Compilations can be completed quickly, providing timely financial information for decision-making purposes.
Compilations are often combined with the preparation of the 990 if an audit or review has not been obtained.

Agreed Upon Procedures

A tailored approach to address specific financial concerns or compliance requirements. An Agreed Upon Procedures engagement is a customized arrangement where specific procedures are agreed upon between management, the board of directors and the CPA firm to address particular financial matters. Unlike audits, reviews, or compilations, which provide general assurance on financial statements, AUP engagements focus on specific areas of concern or interest defined by the organization.

Procedures are tailored to address the unique needs and concerns of the client. Clients have the flexibility to determine the scope and objectives of the engagement based on their specific requirements. The CPA firm reports the findings of the agreed-upon procedures objectively, without providing an opinion or conclusion on the financial statements as a whole.

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