MIP Fund Accounting Software Can Help You Prepare for Audits

 

MIP Fund Accounting

MIP fund accounting software (Abila MIP) can help you prepare more easily for audits. Nonprofit audits are an integral part of the financial cycle for nonprofits. Assisting the auditors makes the entire process easier.

Sign up for RBP Method’s free webinar, Passing the Audit: No AJEs, PAJEs, or Surprises, being held Tuesday, May 16, 2017. This webinar encompasses the overall audit process and highlights what the auditors look for in their testing and review. After attending this webinar, you will be prepared to ensure there are no surprises in your nonprofit audit.

According to the Abila 2016 Nonprofit Finance study, more than half of the organizations responding to the survey required two weeks or more to prepare for an audit. Audits aren’t easy, but with the right mindset and tools to prepare for them, your organization will be in good shape to meet the auditors and assist them as they do their important job.

How Technology Helps Audits

The audit process includes a review of all of your financial information for the past year. Accounting software helps you organize, track, and record all of the transactions made by your nonprofit organization. Some smaller organizations may be fine with spreadsheets or simple off the shelf software, but for larger nonprofits, a robust tool such as MIP fund accounting may be helpful.

Technology helps the audit process in many ways.

  • Tracks budget progress: Accounting programs like Abila MIP can help you track general ledger entries and assess progress towards budget goals. If you are budgeting for a surplus, it can help you assess surplus needs and include surplus requirements in all departmental budgets.
  • Review general ledger: Software makes it easier to review the entire general ledger. Auditors can see transactions, adjustments, and changes throughout the year at a glance. If you are using spreadsheets, it’s impossible for auditors to see whether an entry has been deleted or changed. General ledgers in fund accounting software contain a record of every change, enhancing transparency and accuracy during the audit process.
  • Compliance: MIP fund accounting lets auditors review the entire P&L. They can trace expenses back to individual grants and funds and ensure that there are no compliance issues with how funds are accessed, used, and apportioned. If you are still using old-fashioned spreadsheets, auditors must access and review multiple spreadsheets at once. They may not see an error that they need to track down and inquire into, and that can lead to compliance issues.
  • Classification of net assets: MIP fund accounting software enables you to classify your net assets in the system. Auditors act as a check to your classifications, but they don’t need to review multiple documents. It saves them time during reconciliation.
  • Grant information: Fund accounting software provides auditors with a clear picture of all of your organization’s grant information. You can access basic information, review requirements, and match information to expenditures.

Security Controls

Another benefit of using Abila MIP Fund Accounting software is the ability to control access to your organization’s budget and reports. Tighter security means peace of mind during the auditor process. It means better internal controls which keep your finances and financial records safe.

If you’d like more information on detecting and preventing fraud, RBP Methods has an excellent blog post on the topic. It might be worthwhile to read up on it as part of your audit preparations so that you can enhance security throughout your organization.

Making the Audit Process Smooth Sailing

Audits are an important part of nonprofit financial management and accounting. The more preparation you make to help your auditors, the smoother the audit process will be. A good fund accounting software, such as MIP fund accounting, can help the process even further.

RBP Methods

RBP Methods helps right-brained people navigate a left-brained world. We offer nonprofit software and consulting services. We’d love to talk to you about your online fundraising or other needs. Contact us today or call 503-648-9051.