Nonprofit Advisory, Audit and Accounting

Kim continued on a FlexPath for several years before transitioning to a ClassicPath and taking on leadership responsibilities in 2020. She appreciates the flexibility and support Jones & Roth provides her as her life changes. After graduation, Kim worked for a large firm in Portland, before leaving to explore the private sector.

The Auditors’ Report

During the Fieldwork Phase, auditors dive deep into the financial records and operations of the nonprofit organization. This phase typically lasts between two to four weeks and involves detailed examination and verification. By carefully navigating the selection phase, organizations lay a strong foundation for a successful audit process. The chosen auditor should not only ensure compliance but also provide insights that can drive operational improvements. Moreover, understanding how nonprofits make money can also illuminate why an audit is necessary.

• These principles are vital in fostering financial integrity, which ensures that funds are managed responsibly and effectively.
• Saying no to things we claim are not as important and spending the resources on what we say is important.
• They’ll also provide recommendations for improving financial practices and addressing any issues they identify.
• We have Advisors who are extensively trained beyond traditional nonprofit accounting and auditing services to extend to board development and governance, strategic planning, and cybersecurity.
• Beyond these contingencies, any time nonprofit organizations seek abatement or money back from the IRS, an IRS agent may count these as red flags and invoke the audit process.
• Where I sit as an auditor, I never get a good sense that these questions have are answered.

Taylor Roth is a CPA firm that believes nonprofitorganizations deserve specialists.

• Explore essential practices and insights for effectively auditing nonprofit organizations, focusing on unique financial and compliance aspects.
• They include cost principle, revenue recognition, materiality principle, and full disclosure principle, among many others.
• This involves more than just knowing the expenditure amount; it requires a deep dive into the specific guidelines set by the Office of Management and Budget (OMB) to ensure federal funds are used in compliance with regulations.
• Unlike for-profit entities, which prioritize profitability and shareholder value, nonprofits aim to fulfill a mission-driven purpose.
• Simply stated — we bring our strategic business approach to the not for profit industry, resulting in unprecedented growth and success for many of our NFP clients.
• If you are an auditor, have you also come across the donor delayed funding “operating constraints”.
• Georgia, like Ohio, also has its own unique set of audit requirements for nonprofits.

The Form 990 gives the IRS information on how the nonprofit’s activities and financial situation. A financial audit by an independent CPA is https://nerdbot.com/2025/06/10/the-key-benefits-of-accounting-services-for-nonprofit-organizations/ performed methodically and according to rigorous criteria. One step leads to the next so the nonprofit firm has a full picture of its financial health. A strong internal control system includes a clear organizational structure, competent personnel, and a commitment to ethical values. Risk assessment identifies and mitigates potential threats, such as dependency on funding sources or donor restrictions. Control activities, including approvals, verifications, and reconciliations, mitigate risks.

Audit Services

Basically, the review opinion says we looked at the financial statements and we didn’t see anything that looked wrong. Our team of experienced not-for-profit auditors strive to give insight and guidance, helping a wide variety of organizations grow and thrive — even after the audit process is complete. Overall, the audit ideally confirms that the organization is operating in accordance with generally accepted accounting principles (GAAP). They include cost principle, revenue recognition, materiality principle, and full disclosure principle, among many others. The audit helps to hold the organization accountable to its directors, its investors, and its donors.

In the nonprofit world, organizations are well aware that there are “strings attached” to many of the resources that support the mission work. This is but one factor among many that has already convinced us that Cerini is the right firm for us as we continue to grow. Their expertise in dealing with non-profit organizations has proven extremely helpful to us, and they have demonstrated strong analytical skills in addressing typical, as well as complex, transactions. They are unusually responsive to all of our needs and we look forward to many years of working with them.

• As a member, we have access to comprehensive resources that assist us in further enhancing the quality of our nonprofit audits.
• This ensures that they choose an auditor who understands their specific needs and can provide comprehensive support throughout the audit process.
• Regular audits help in identifying discrepancies and improving financial management, thus fostering trust among donors and stakeholders.
• However, some may opt for bi-annual or even quarterly audits to ensure ongoing oversight and address potential issues proactively.
• From financial health check-ups to internal controls strengthening, we provide a wide range of consulting services meant to help your nonprofit organization understand and improve their financial data.

It helps me dispel the fallacy that we auditors are some sadist evaluators looking to fail people, on job exams of sorts. Blog to share news, experiences, best practices and to network with other auditors in the nonprofit practice arena. This limited financial audit could include an audit of your inventory accounts or accounts receivable. Other times your parent organization might seek a business audit of your entire operation, i.e. a full corporate audit. Once the auditor completes their work, they’ll compile their findings into a report and present it to your nonprofit.

• If you would like more information about how Fohrman & Fohrman can empower your mission-driven nonprofit to grow and succeed, please complete our email sign-up form.
• Your non-profit organization works hard to give back so we developed affordable, high-quality services.
• Nonprofit Collaborative of Southern CaliforniaJanet Fohrman is the founder of the Nonprofit Collaborative of Southern California (NPCSC).
• A boundary-less IT security defense architecture (design) is definitely one that nonprofits should consider.

How can independent audits benefit my nonprofit?

States like Ohio and Georgia introduce additional layers of complexity with their own distinct audit thresholds and reporting requirements, often going beyond federal mandates. How do non-profit audits contribute to organizational transparency and accountability? Non-profit audits are critical in ensuring that organizations adhere to established audit standards, which dictate the rigor and thoroughness of the audit process. This process involves a comprehensive examination of financial records, internal controls, and compliance with laws and regulations. By engaging independent auditors, non-profits can provide stakeholders with an objective assessment of their financial health and operational effectiveness.