Outrageous Auditing Church Financial Records

There are several reasons why a church may perform an internal audit.

Auditing church financial records. This is much more challenging. A local church audit is defined as an independent evaluation of the financial reports and records and the internal controls of the local church. Here is our practical working definition of an audit for the local church.

External audits are performed by an independent auditor who has no impairing relationship to the church and therefore can review its data procedures with maximum objectivity. But first we need to address how an IRS audit can begin for a church. This is required by the Book of Discipline see excerpt below.

How an IRS audit begins for churches. Paragraph 12924 requires an annual audit of the churchs financial records. Audit of the financial statements of the local church and all its organizations and accounts.

Recognize all employees as employees. The canonical deadline for filing your audit is August 31. A congregational audit is an independent evaluation of the financial records and the internal controls of the congregation for the purposes of providing an opinion on the reasonableness of the congregations financial statements and recommending improvements to its internal controls.

The Financial Secretarys records and other income records for the same period. The documents you will need to complete your audit. Others may not need an external audit or have the resources for one.

Some churches are required to do so by their constitution or denomination. There also should be an annual audit of the churchs financial records. The primary purpose for financial audits is to give regulators investors directors and managers reasonable assurance that financial statements are accurate and complete.