Non-profits and charitable organizations perform an incredible function in the world. These selfless agencies don’t just lend their extra time and resources to serve the communities around them – they exist to do so. Because these charitable organizations are tax exempt, non-profits carry a high level of ethical responsibility on behalf of both the public and the government. Non-profit auditors come along side non-profits to assist them with the important task of maintaining financial transparency. Clifford, Ross, Raudenbush & Cooper, LLC is ready to help!
Public Disclosure Requirements
To receive tax-exempt, non-profit status, organizations are required to fill out an application for tax-exemption. The IRS requires non-profits to keep accurate financial records and to produce copies of their most current annual records via the IRS Form 990. Upon request, non-profits may also need to disclose this financial information to to the public. Board members serve as checks and balances for the financial side of non-profits.
Why Transparency Matters
Financial transparency is incredibly important for any non-profit. The benefits of fostering a transparent environment by hiring non-profit auditors are manifold. Through financial transparency and auditing services, non-profits:
- Reassure Donors
- When donors extend their resources to invest in non-profits, they demonstrate trust in that particular organization by coming alongside its mission. Accordingly, charitable organizations have a mandate and responsibility to maintain this trust. Maintaining donor trust requires more than just stewarding resources well. It also requires a certain level of transparency so donors never feel misinformed or out of the loop.
- Build a Reputation of Integrity
- As a non-profit continues to demonstrate financial responsibility, its reputation builds and solidifies. Most non-profits espouse the core values of integrity and honesty, but fewer actually demonstrate those values. Ethically-responsible charitable organizations understand how important financial transparency is for their organization, their investors, and the people they serve.
- Maintain Accuracy
- Non-profits are not technically required by the IRS to conduct an audit. Even so, other governmental agencies sometimes request that charitable organizations undergo audits. Moreover, many non-profits independently choose to hire non-profit auditors to assist them by examining their financial records and accounting statements. Non-profit auditors determine the accuracy of an organization’s accounting practices and takes note of internal practices. Then, given that everything is up to par, the auditor will issue a public report in approval of the non-profit.
- Create Good Habits
- Working toward financial transparency will necessary assist non-profit leaders in developing and sustaining accurate accounting practices. When it comes to organizational leadership and administration, it is an undeniably good habit (even a necessity!) to be organized with numbers and records. If a non-profit leader struggles with the administrative side of ‘public charities’, he or she can hire a certified public accountant to assist with finances during the fiscal year.
Non-Profit Auditors Serve Your Vision
Non-profits and charitable organizations work tirelessly to see a vision come to life. Non-profit auditors function to partner with these organizations in an effort to smooth out the financial road bumps along the way. The team at Clifford, Ross, Raudenbush & Cooper, LLC are available to partner with you and serve your vision through our financial and administrative knowledge. Contact us to find out how we can help you!