Many not-for-profit organisations in Australia voluntarily choose to have their books audited, while some are required by the ACNC (Australian Charities and Not-for-Profits Commission) to have this done annually.
Whether you are a bookkeeper or treasurer, here are some tips to help you sail through your next audit:
- Are all your source documents filed in a way that they are easy to access? For example, invoices, bank statements, timesheets, financial statements, cheque books.
- Is your Asset Register up to date?
- Has anything significant occurred since your last audit that needs to be explained to the auditor? For example, a change in accounting procedures.
- Can you provide proof of asset and liability amounts in your Balance Sheet? For example, the balance of bank accounts.
- Have you got solid internal control systems in place? For example, a written protocol for cash counters. I shared information on internal controls in my post Reducing the Risk of Fraud and Error in Small Business.
These are some of the things your auditor may focus on when auditing your books. Once you receive your report, be sure to take into consideration any recommendations and ask questions if there is anything that you don’t understand.