Hi,
I am new here and still studying for the professional financial Accounting level with the IFA. I never got on with the topic of audits for some reason... and I'm not quite sure whether business is right with this either.
I am a member of a small breed society with 138 members and about £10,000 in the bank accounts, this year we made a profit of about £2,900. Last year the treasurer asked me for a proper format, so I prepare the statements for him.
On the committee things are not quite as pally as they should, so it was decided that neither committee members nor ordinary members can be trusted to check that no mistakes have been sneaking in the book keeping, so it is discussed to hire an accountant for an independent audit.
The question from some members was whether we NEED an independent audit.
I tried to find somewhere written from what point or what turnover independent audits are recommended for Associations and societies. We are not a charity, the profit we make should be spent to promote the breed and the society.
Please maybe someone could enlighten me on this matter, so that we know where we stand.
Thank you very much and with
kind regards,
Ella
Replies (4)
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There is no requirement for an audit ....
... unless the rules of your society say an audit is to be undertaken.
I would have thought an audit was way over the top for your finances - the cost will be disproportionate. You would be much better off finding an accountant who would be willing to give some form of limited certificate to the effect that he / she has examined the records and that the accounts are in accordance with the records.
Agreed
An audit is way over the top. Small organisations like yours have to rely on a large element of trust. Any 'savvy' member could examine the records and determine if any wrongdoing has occurred- otherwise the usual safeguards (two signatures on cheques, all expenses receipted etc) should be adequate
You don't need an audit
My local Yacht Club has the accounts auditedby a firm of CAs. Specific request for an audit as per the rules.
the certificate reads.(inter alia)
We have carried out an independent examination of the records without carrying out an audit. No opinion is given as to whether the accounts provide a a true and fair view.
WORTHLESS!
The Association of Independent Examiners (ACIE) is a place to go to find people qualified and willing to undertake Independent Examinations for societies and charities but the best safeguard is to have sound internal financial controls. You do not need an audit unless, as is stated above, your constitution states it is necessary. If your constitution states this then change it asap.