ABOUT THE COURSE
Charities may not regard an external audit as vital to their operations, or may view it as another compliance cost competing with limited resources. However, the benefits of a good external audit, which include greater stakeholder confidence in the charity’s governance, may outweigh the costs. Furthermore, a cost-effective external audit can help charities to avoid unnecessary audit costs, with funds saved channelled to more productive uses that directly support its beneficiaries.
Our Making Audits Cost-Effective for NPOs course will help charities understand the cost composition of an external audit and the measures that they can adopt to improve cost-effectiveness in the process.
WHAT YOU WILL LEARN
By the end of the programme, participants will be able to:
- Develop a good understanding of the annual audit requirements.
- Create an effective plan in working with the auditors.
- Provide timely assistance to complete the audit in the assigned timeline.
- Ensure proper financial statements to provide confidence to stakeholders.
- Continually improve on the quality of financial statements and the internal controls systems.
- Minimise common errors.
- Why should charities be audited – for renewal of charity and or IPC status?
- Compliance with statutory requirements.
- Accountability to stakeholders.
- Identify and minimise the risk of material errors, omissions and misstatements.
- How to evaluate and appoint the “right” auditor?
- Analyses auditor’s track record.
- Meeting the organisation’s needs.
- Value adding services.
- What are the expected reports from auditors – What is required from the Board, Audit Committee and Senior Management?
- Audit plans – approach, processes, timelines and responsible people.
- Presentation and report to Board, Audit Committee and senior management.
- Management Letter – improvements to internal controls and other areas.
- Audit opinion on whether the financial statements are true and fair.
- List of adjustments and reclassifications where applicable.
- What are the key factors that impact on audit fees?
- Seniors vs juniors audit staff.
- Time spent on audit.
- Choice of financial year end (December year end being the peak for audit firms).
- Strength of internal control systems.
- Documentation of policies, operating procedures, and major contracts.
- Staff preparedness to provide assistance to auditors in queries and interviews.
- Checklist for preparing for the audit
- Policies and Procedures.
- Conflict of interest declarations.
- Related party transactions if any.
- Minutes of Board and committee meetings especially those relating to finance.
- Regulatory submissions.
- What are the common reporting errors to avoid?
- Ensure compliance with Charity Accounting Standards or Financial Reporting Standards.
- Fund accounting restricted v unrestricted.
- Fund raising efficiency ratios.
- Governance costs and Programme costs computation.
- Key items disclosure eg non related party disclosure, top three remuneration over $100K.
- Preparing the Board’s Response to Auditor’s Management Letter
- Post audit follow up action
- Review of delays where applicable.
- Communication process with auditors.
- The role of internal audit.
The course is taught across 16 hours, with lectures, videos, case studies, group discussions, checklists, *invited speaker(s). For 4 or more participants from the same organisation, 1-hour post-session coaching will be provided.
*Invited speaker(s) may be pre-recorded.