Audit Time: What It Is and How to Prep
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Audit Time: What It Is and How to Prep PRESENTED BY: MARY W. RICHTER, CPA
Transcript of Audit Time: What It Is and How to Prep
Audit Time: What It Is and How to Prep PRESENTED BY: MARY W. RICHTER, CPA
Today’s Discussion: ü Whatisanaudit
ü Whydowehavetohaveone
ü Whataretheresponsibilitiesoftheauditor
ü Whataretheresponsibilitiesofthedistrict
ü Howtoprepareforanaudit
WHAT IS AN AUDIT Therearemanytypesofaudits◦ Financialstatementaudit–providesassuranceastothefairrepresentationofthefinancialstatements◦ Forensicaudit–collectingandanalysisinformationtopresentincourtproceedings◦ Internalcontrolaudit–assessingtheeffectivenessoftheinternalcontrols◦ Singleaudit–assessingcompliancewithfederalprogramrequirements,thecurrentthresholdis$750,000.
WHY DO WE HAVE TO HAVE AN AUDIT Staterequirementforallgovernmentalagencieswithannualexpendituresover$100,000◦ Biannualrequirementif$100,000to$250,000◦ Annualrequirementifover$250,000
HighwaydistrictsshouldhavetheirauditscompletedbyJanuary1stoftheprecedingyear
ReportedtotheLSOwithin9monthsofthefiscalyear-end
AUDITOR’S RESPONSIBILITY VS DISTRICT’S RESPONSIBILITY Theonlythingtheauditorisresponsibleforintheauditedfinancialstatementsaretheirreportsattestingtothefinancialstatements,theinternalcontrols,and/orthecompliancewithfederalprograms.
EVERYTHINGELSEISTHERESPONSIBILITYOFTHEDISTRICT,EVENIFTHEAUDITORHELPSYOUDRAFTTHESTATEMENTS.
HOW TO PREPARE FOR AN AUDIT o TheauditorshouldprovideyouanauditrequestlistorPBC(PreparedbyClient)listo Reviewyourprioryearauditfilesandnotesincludinganyadjustingentriesfromauditor
o Ensureprioryearagreeswithprioryearaudito Printa“Mary’sList”orMasterList
o Agreeallassetsandliabilitiesaccountstosupportingdocumentationo Recordingaccrualsandfiscalyear-endadjustments
o Agreemajorrevenueandexpenditureaccountstosupportingdocumentationo Recordingallcapitalexpendituresintocapitaloutlayaccountso Recordalistingofallcapitalexpendituresbyprojectfordepreciationschedule
o Comparecurrentandprioryearaccountslookingforlargevariances
AUDIT PREP APPROACH – CHECKLIST EXAMPLE q Thepriorfiscalyearagreewiththeprioryearauditq Printatrialbalanceorfinancialstatementsforthecurrentfiscalyear
q Cashaccountsagreetothelastbankreconciliationq Haveallinterestpaymentsforthefiscalyearbeenrecordedq AreanybankaccountsoverFDIClimitsq Anyrestrictionstocash
q Accountsreceivableagreestoanysubledgersorsupportingdocumentsq Hasthehighwayuserreceivablebeenrecorded
q Anyprepaidexpenses(usuallyinsurance)q LIDreceivable
AUDIT PREP APPROACH – CHECKLIST EXAMPLE cont.
q Propertytaxreceivableanddeferredtaxcalculationq Inventorylistingagreestosupportingdocumentation
q Accountspayableaccountsagreetosubledgerorsupportingdocumentationq Ifthepayablewillbereimbursedisthereceivablerecorded
q AccruedpayrollcalculationincludingpayrolltaxesandPERSIq CompensatedabsencecalculationincludingpayrolltaxesandPERSI
q Anyotherdebtincludingleases,bondpayments,etc.
q PERSIinformationforGASB68disclosure
q Fixedassetschedulewithdepreciationcalculations
THANK YOU FOR ATTENDING Thispresentationisintendedfortrainingpurposesonlyandisnottoberelieduponforanylegal,tax,consulting,orprofessionaladvice.Ifyouneedanyofthoseservicesyouneedtocontactyourlegaland/oraccountingprofessionalforassistance.
ContactInformation:
MaryW.Richter,CPA
