„…What follows is an “audit program” or list of specific procedures to be performed by the Audit Committee during its consideration of cash receipts and cash balances. It is not intended to be all inclusive, nor will all steps be relevant in every church. It will, however, give the Audit Committee a base from which to work in designing its own series of tests.
The Committee must exercise its own judgment in tailoring this program to the situation in its own church.
Suggested Audit Program – Cash Receipts & Balances
1. Obtain a list of dates of Sunday and other services during the year at which collections were taken.
2. From this list choose a representative sample of dates. For each date chosen, obtain the documentation prepared by counters.
3. Verify by addition the total amount recorded on the count sheet for each date. Note the amounts designated as pledge income and loose offering income.
4. Trace these amounts into the accounting records as cash receipts and note any
5. Optional: For one or more dates chosen, trace a sample of individual pledge gifts into the donor’s pledge card or other pledge record to establish the accuracy of the pledge cards.
Note: In some churches the pledge records are considered too confidential and will not be available for this type of test.
6. For each date, trace the total amount collected to a bank deposit slip and to the next subsequent bank statement. Note any discrepancy.
7. Obtain a summary of collection amounts by week, and verify by addition the yearly total of all weekly collections. Compare this total to the total pledge and loose offering
income in the annual financial reports. Investigate any significant discrepancies.
8. Optional: Obtain the pledge cards or other pledge records and verify by addition the total amounts listed as contributed. Compare this to the amounts on the weekly summaries and to the amounts in the annual financial reports as total pledge income. Note: In some churches the pledge records are considered too confidential and will not be available for this type of test.
9. Obtain or prepare a list of all bank accounts owned by the church and compare to last year’s list, noting any changes. Trace any openings or closures to the minutes of the church governing body.
10. Obtain the passbook or year-end statement for all savings accounts and determine the fiscal year-end balance. Compare this balance to the balance listed in the annual financial report and investigate any differences.
11. For each checking account, obtain the year-end bank reconciliation and the bank
statements for the last month of the year and the first month of the new fiscal year. Trace the “bank balance” from the reconciliation to the bank statement.
12. Trace any normal reconciling items such as deposits in transit or outstanding checks to the first bank statement of the new year, looking for any undue delays in clearing.
13. Investigate any unusual or non-recurring reconciling items, obtaining documentation of legitimacy. If such items exist, examine prior months reconciliation’s to see if the items have been carried forward from month to month.
14. Once reconciling items are verified, compare the “book balance” from the reconciliation to the balance in the accounting records as of the fiscal year-end and to the balance reported in the annual financial reports.
15. Count the petty cash fund and determine that the fund is intact.
16. Choose one prior reimbursement of the fund and examine the documentation in order to establish the validity of items and amounts expended from the fund…””
For entire „Handbook for audit committee” click HERE
„Used by permision of the Commission for Leadership Development Massachusetts Conference, United Church of Christ”