A checklist to help you plan, implement and learn from the process
Once you’ve figured out whether you need an audit or independent examination, you’re ready to get started.
Follow these steps to ensure the process runs as smoothly and cost-effectively as possible:
- Search for an auditor or independent examiner with experience in the sector (search the website of the Association of Charity Independent Examiners for an approved charity independent examiner, or look for recommendations from other nonprofits or membership organizations)
- Request quotes and select your chosen firm based on reputation, experience auditing similar organizations, qualification and cost
- Have your trustees approve the appointment of that person
- Request an audit plan from your auditor so you know in advance what detail they will review and what information will be required
- Prepare for the audit/examination by ensuring all records are up-to-date and properly filed
- Prepare any documents or records requested
- Ensure your auditor/examiner will be able to work from a quiet place, and that staff will be on hand to respond to them as needed
- Ideally, encourage them to submit a management letter, summarizing their findings. They should point out any weaknesses and make recommendations for areas of improvement
- Submit the report to your trustees for review and questions
This article draws on the expertise of Nishka Smith, a chartered management accountant and founder of the London-based Visual Finance Ltd., which supports charities to strengthen their financial management and planning capabilities.