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In Search of the Bottom Line. How to select the Audit Committee.

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Presentation on theme: "In Search of the Bottom Line. How to select the Audit Committee."— Presentation transcript:

1 In Search of the Bottom Line

2 How to select the Audit Committee

3 Governor shall appoint an Audit Committee of a minimum of three (3) members

4 DO NOT just ask your friends to serve

5 The Audit Committee should have a sufficient number of members to ensure needed skill sets and knowledge are represented on the committee

6 The Audit Committee needs to commit sufficient time to review, discuss, and consider the financial statements

7 Members of the Audit Committee need to have financial literacy/expertise (At a minimum, the ability to read and understand financial statements)

8 Willingness to do the right thing, not just do things right

9 Treasurer’s books should be delivered to the Audit Committee by July 31

10 Information the Treasurer needs to give to the Audit Committee

11 The Audit Committee needs these records for the year being audited: Checkbook register Bank statements Treasurer’s reports Cash receipts and disbursements Budget

12 Proving the Accuracy of the Books

13 Take the beginning balance established by the last audit, add the receipts for the year and subtract the disbursements to determine the BALANCE ON HAND AT THE END OF THE FISCAL PERIOD

14 This balance should agree with: (1) the balance on the treasurer’s financial report and; (2) the bank balance plus any cash on hand

15 If the Treasurer did not reconcile the bank statements, the Audit Committee should do so. The adjusted book balance and bank balance must agree with the BALANCE ON HAND AT THE END OF THE PERIOD

16 Ascertain that the correct amount of dues and initiation/reinstatement/ transfer fees have been collected from the membership

17 Verify the amount received for District dues

18 Check to see if the total amount of receipts agrees with the total deposits

19 Ascertain that the total amount of all checks written equals the total amount of disbursements recorded on the books

20 Verify proper Authorization

21 Verify that all checks were signed by the Treasurer and either the Governor or the Governor-Elect

22 Confirm that all checks written are supported by an expense voucher that has been approved by the Governor or the Governor-Elect

23 Audit Report

24 The report should be short and to the point. State what the review included, what was found, an opinion of the balances and any recommendations which may be helpful

25 It is the duty of the Chair of the Audit Committee to prepare the report. The Committee should make an effort to correct any inaccuracies

26 Sample Report by the Audit Committee

27 “The Audit Committee of the Pilot International District of _____, certifies that it has examined the books of the treasurer from the period of (date, first day of fiscal year) through (date, last day of fiscal year), and has found them to be correct.”

28 Each member of the Audit Committee should sign and date the audit report

29 Questions

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