Audit Preparation for Successful Audit

One reason a nonprofit might conduct an audit is to demonstrate the organization’s commitment to financial transparency and accountability.  Also, you many have specific grantor that requires an audit or maybe you have any audit if you suspect fraud or illegal acts.  While a nonprofit can spend considerable resources for its annual audit, it is important that it consider the following to ensure the audit is a success.

• No delays
• Minimal accrual and year end adjustments
• Minor board and management comments
• No material weakness or significant deficiency
• Nonprofit should prepare audited financial statements and related disclosures
• Fraud detection is not purpose of audit
• Auditor does not guarantee financial statement accuracy

If your nonprofit has any of these pitfall or misperceptions, you should take action to bring expertise like our audit preparation services to remedy and correct these audit issues  Resources for audit readiness and preparation resources include:

Year End Audit Preparation Checklist

Is your nonprofit subject to a federal funds audit?

7 steps to a successful audit

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Managing Cash Flow

While standard nonprofit financial reports provide important management information, these reports alone do not tell whether there is enough cash on hand.  It is important to manage cash flows especially when operating with a financial deficit and unexpected events.

You can start to manage your cash flows by developing cash flow projections that look forward up to 12 months.  Once you develop cash projections, you can then work to develop cash flow management strategies.  The following are cash management strategies:

• Speed up the receipt of income
• Slow down payments
• Increase Cash Receipts & Reduce Cash Disbursements

Best practices to avoid cash flow problems include:

• Develop realistic budgets each year
• Operate with goal of obtaining a financial surplus
• Build cash reserves over time
• Be aware of cash flow and budget assumptions and react to changes as they occur
• Maintain good relationships with funders, donors, and vendors and keep them informed of cash flow issues

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Top Indicators of Nonprofit Financial Health

Nonprofit leaders have a difficult mandate to constantly balance money and mission, while collecting and sharing data on social and financial performance.

How can nonprofit executives, funders, and advisors identify what matters most when examining finances? What are some trends and indicators that can guide us through an abundance of data and help assess true financial health?

The following list of financial indicators based on our experience providing nonprofit accounting solutions.

• Revenue reliability
• Consistent financial surpluses
• Working towards full cost coverage
• Appropriate liquidity
• Ability to manage debt and steward facilities

The full article provides a detailed explanation.

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Our Firm-Your Team is here to help-Schedule Today

Our firm has grown because of strong client relationships with referrals from our clients and other referral partners.  Our staff is very experienced at performing the accounting function for our clients.   Our nonprofit accounting services includes bookkeeping, accounting, controller, and CFO services.  Our nonprofit software accounting software expertise be composed of QuickBooks Online, MIP Fund Accounting, Microix Workflow Modules for MIP, and Sage Intacct.  Our nonprofit software services comprise software assessments, sales, data conversions, implementations, training, support, and project management services.  Our financial management training consists of newsletter, nonprofit financial forum, & MIP user group.  Our approach is to work with you to determine how your organization can best benefit from our professional services. 

Additional FTM resources to help your organization:

Is now time for financial assessment?

FTM offers client care plan for QBO and MIP users?

Why you should consider an Outsourced Controller or CFO?

Does my Nonprofit Need a Controller?

Eight Reasons to Outsource Your Nonprofit Accounting

When to Consider a Move to Fund Accounting?

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Our firm provides all the levels of accounting your nonprofit needs including bookkeeping, accounting, controller, CFO, and software advisory services for nonprofit accounting software including MIP, Microix, QuickBooks, Sage Intacct and AccuFund