Last updated on July 3rd, 2024

Putting in the time and effort to prepare for an audit can help your district facilitate a smooth process that saves time and money; leads to a reliable and objective audit report; and helps detect and rectify potential issues before the audit begins.

Here’s a checklist of what to do before an audit to help streamline the actual audit itself, meet key deadlines (and avoid delays), and even possibly lead to better outcomes:

• Familiarize yourself with the audit process and standards such as Generally Accepted Accounting Principles (GAAP) and Governmental Accounting Standards Board (GASB) guidelines.
• Create an audit committee and select its lead. Discuss the audit process, requirements, roles and responsibilities, and a timeline of key dates and activities.
• Meet with the Committee and auditors to review the audit plan.
• Meet with business office staff to discuss the implementation of any new accounting standards.
• Request, collect, and organize documentation and information from appropriate departments and staff, per the audit requirements. This includes income statements, balance sheets, and cash flow statements, bank statements, invoices, receipts, payroll records, purchase orders, contracts, and other financial documents.
• Gather information about new or closed bank accounts; new charters and activities; Board members and Administrators; and any debt and attorney information necessary for confirmations. Remember, you must report any material financial or management changes.
• Prepare copies of current Risk Assessment documents, Claims Auditor reports, Internal Audit reports, OSC audits and corrective action plans, OPEB actuary reports, lease agreements, subscription-based IT arrangements, and tax abatement information.
• Coordinate with firms providing financial services (i.e., maintaining depreciation records or preparing financial statements) to obtain the required documentation.
• Reconcile all accounts by checking that amounts match between accounting records and the actual cash, assets, liabilities, equity, revenue, and expenses.
• If applicable, review records of student activity funds. These funds are often audited separately and require special attention.
• If you received grant funding, ensure all documents relating to the grant are available and organized. This includes grant agreements, receipts of expenditures, and performance reports.
• Maintain up-to-date and complete inventory records of capital assets, including property and equipment.
• Prepare a Management Discussion and Analysis (MD&A) report that includes financial highlights, an overview of the financial statements, and a description of the district’s financial performance.
• Review and document internal processes and controls (they’ll be evaluated in their effectiveness at preventing fraud and errors).
• Conduct a self-audit or internal review to identify and address any potential problems. Perform a fraud risk brainstorm.
• Review federal and state regulations to ensure that all compliance requirements are met. This includes funding guidelines, procurement procedures, and payroll laws.
• Review any prior audit findings and recommendations to ensure corrective action was implemented.
• Make sure the initial resolution for funding of district reserves is passed by June 30 and any follow-up resolutions are completed before the tax levy is set.
• Present results to the Board and ensure the audit is filed by the October 15 deadline.

As you prepare for your audit, please know you can always count on RBT CPAs for accounting, audit, advisory, and tax assistance. Contact us to learn how we can be Remarkably Better Together.

RBT CPAs is proud to say 100% of its work is prepared in America. Our company does not offshore work, so you always know who is handling your confidential financial data.