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March 30, 2016

March Madness or Audit Madness

NFP Partners provides services to a variety of nonprofits, including participating in the madness of preparing for the annual audit. We often have conversations with our nonprofit clients regarding the necessity of an audit and if a rotation of audit firms is a “best” practice. Throughout the year, we work with clients to ensure that our tracking schedules (temp restrictions, prepaid expenses, deferred revenue, receivables and liabilities) are up to date, bank reconciliations are completed, balance sheet accounts are reviewed and reconciled, internal control procedures are followed and budget variance explanations are prepared. Even with having those things all done timely during the year, it still seems to take forever to complete and compile the requirements of the auditor’s PBC (prepared by client) list. The long and short of it is that there's an investment in time and expense to prepare for an audit. For a small nonprofit, the audit preparation costs – plus the fees – may be difficult for the budget to handle. For any size nonprofit, an audit firm rotation requires an investment in orienting the new firm to the organization in addition to the preparation costs.

So, should a small nonprofit opt for a financial review instead of an independent audit? There are circumstances that may trigger the requirement for an independent audit. These include:
  • Specific requirements of foundation, federal, state or local government funders
  • Requirement of submission to the state for the annual charitable solicitations reports
  • Requirement of financial institutions for loan transactions
  • Requirement of an additional A-133 audit if the expenditure of federal funds is in excess of $750,000 in the fiscal year

If a nonprofit does not meet the above requirements, a financial review is an option. So what does a financial “review” entail and how is it different from an audit? The “review” is conducted by an independent auditor and examines the organization’s financial statements to determine whether they are consistent with generally accepted accounting principles. The auditor does not conduct the same level of analysis or include an examination of internal controls.  A review will provide some assurance of the financial statements through a review for material issues and obvious deviations from GAAP, but testing of transactions is not conducted.

So, should any nonprofit solicit and rotate audit firms on a regular basis?

Read More

Laura Jorstad
Managing Principal
NFP Partners

Takeaways from AUDC 2016

Earlier this month I attended the Abila Users and Developers Conference (AUDC) in Austin, Texas. The conference is an annual event and brings together Abila’s software users, business partners (like us), vendors that offer complimentary software applications or services, and various other organizations having a stake in the not-for-profit world.

Normally, affairs like this are not my favorite pastime, but this one exceeded my expectations. It was a great opportunity to personally connect with the people we work with at Abila, acquire some relevant training (CPE approved), and get a sense where business software for the nonprofit sector is going. Austin was nice, too, boasting first-class accommodations at the conveniently located new downtown JW Marriott and wonderful weather. Spring had definitely sprung with people in shorts, sandals and tank tops.

Let me take off on where business application software, such as accounting, fund raising and membership management (Abila’s big three) is going. Not that this is unique to nonprofit world, it can be summed up in three words: Cloud, Mobile, Integration.
Click here to read more.

Lee Bengston, CPA
NFP Partners
NFP Partners
3570 E. 12th Ave.
Denver, CO 80206

T: 303-586-5011

Contact us for a financial management assessment and to find out more about how NFP Partners can help you.


April Monthly MIP Virtual Forum

The MIP Virtual Forum is an informal group of Abila MIP Fund Accounting software users who meet via a web conference monthly on the third Wednesday at 10:00 am mountain time. Its purpose is to share information about the use of the software among nonprofit accounting peers to improve effectiveness and efficiency.

NFP Partners, the Rocky Mountain area Abila Business Partner, provides training content at no cost to the participants. The Forum is open to all MIP users regardless of staff position and whether or not a client of NFP Partners. The only requisites are having a serious interest in improving use of the software and a willingness to share.

During the March Virtual Forum users explored different ways to accomplish data entry with some tips and tricks, including how memorized and recurring entries can serve as helpful reminders as well as simplify and ensure consistent data entry. In April we will continue to explore other methods for getting data into the system. Join us at 10 a.m. on April 20th to learn, share your questions and own ideas.

Register for April 20th MIP Virtual Forum

If you have suggested items or report formats, please send them in advance to Laura at


Articles of Interest

We have discovered some different and new sources of useful information for nonprofit executives and managers which will hopefully make this section of the newsletter more interesting and better read.

Effective Nonprofit Board Governance: Ten Responsibilities of the Board (Part I)

GuideStar Launches New Nonprofit Profiles

Form 1023-EZ: First-year results are in

Examining Nonprofit Liquidity Issues: A New Look at Government Contracts

New ACA IRS Filing Requirements: Are You Prepared?


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