CHAPTER PLAYBOOK

Financial Audit/Review

All Chapters are expected to have an independent review of the Chapter’s Annual Financial Reports (financial statements) at the end of the Chapter year. The independent review requires prudent testing of a sample of underlying transactions and testing the accuracy of the Annual Financial Report.

1. There is no requirement that the audit or financial review be done by a CPA. It is critical that you check your Bylaws to determine if a certified audit is required at year-end, or if a financial review is acceptable. Many Chapters find that a certified audit is necessary only every couple of years (i.e. every third year) and a financial review is appropriate for the other years.
2. If the Chapter opts to perform the review itself versus hiring a third-party CPA, the following guidelines must be followed:
   
   
   1. The review must be performed by a committee of at least three members who were not actively involved in the original approval, receipt, disbursement or recording of the transactions. Alternatively, a single nonmember of the Chapter could complete the review.
   2. Chapter officers, board members and staff members may NOT serve on the audit/review committee.
   3. The Chapter Treasurer and/or Chapter Staff must provide the audit/review committee with access to financial records necessary to perform a thorough audit/review of the Chapter’s financial records, including bank statements, bank reconciliation reports, check registers, general ledger detail transaction reports, financial statements and supporting documents (Accounts payable, accounts receivable invoices, balance sheet schedule and dues disbursement reports. For test expenses, vendor invoices, approval documentation and credit/debit card receipts). Financial controls, policies, procedures and annual budget must also be provided.
   4. The Chapter Secretary and/or Chapter Staff must provide new or updated contracts, executive committee minutes, board minutes, board contact information and Bylaws.
   5. The review must include confirmation that an internal control review was performed.
   6. The audit/review committee should communicate its findings to the board in writing, naming the committee members who performed the audit/review, date of the audit/review and contact information of the chair.

In addition to the above guidelines, Chapters can also download the Internal Volunteer Review Process, Financial Internal Controls, the Financial Activities Checklist for Chapters or the Form to Confirm Account Balance for further assistance.

Retaining a Certified Public Accountant (CPA)

Drafting a request for proposal (RFP) should detail the required qualifications, responsibilities/scope of services and define fees and hourly rates (note: the RFP should request hourly fees/rates or state a budget that the Chapter has available so that the response can be tailored to fit the budget).

Crafting a RFP that’s thoughtful and well written with clear response expectations is key to receiving comparable submissions. The RFP should also provide details on how the selection process will be managed and who will be the point of contact.

NAIFA Model Certified Public Accountant RFP

Quick Links

Internal Volunteer Review Process
Financial Internal Controls
Financial Activities Checklist for Chapters
Form to Confirm Account Balance
NAIFA Model Certified Public Accountant RFP