Posts Tagged ‘emily campbell’

6 Ways to Prepare for Your Audit

Emily CampbellBy Emily Campbell
Staff, Audit & Assurance Services

When you hear the word “audit,” do the words “stress” or “dread” immediately come to mind?

At Sponsel CPA Group, we want your audit to be a positive, hassle-free experience with us. Consider the audit process as an investment in your organization’s future by way of fine-tuning processes that allow for adequate oversight and preparation of financial statements.

To ensure you have the best experience possible with your audit, here are six steps to help the process go smoothly:

  1. Communicate with your audit team

The first thing you can do to reduce the stress of an audit is establish a timeline with your audit team. Set fieldwork dates and deadlines for compiling all requested items. Make sure any required financial statement deadlines are communicated. This will ensure everyone is on the same page and allow both you and the audit team to plan accordingly.

It is also important to communicate significant changes from prior years, such as changes in business operations, changes in accounting methodology or other major transactions (refinancing debt, new lease agreements, adopting a new accounting pronouncement, etc.) with your audit team, so that they can appropriately plan for the audit. In addition, be prepared to discuss variances in budget to actual, variances between current and prior year, and other changes – such as restructured management, ownership, new business operations, or a change in accounting personnel.

  1. Reconcile your accounts

It is crucial to reconcile all balance sheet accounts at year-end. Maintain supporting schedules for the final balances, especially for major accounts such as cash, accounts receivable, inventory, accounts payable and accrued expenses. Make sure you are able to support any management estimates used in financial reporting (e.g., allowance for doubtful accounts, inventory allowance, depreciation, functional expense allocation, etc.). We recommend having different levels of review to identify any errors, discrepancies, or variances from expectations. Review the prior year adjusting journal entry report to determine whether or not similar adjustments should be made in the current year.

  1. Update your Property, Plant and Equipment (PP&E) schedules

Review your current PP&E schedules to determine whether all assets listed are still in use and if there have been any additions or disposals the past year. Compile a list of assets purchased or sold during the year, including dates, amounts and detailed description of the assets to provide to the auditors. Also, review repair and maintenance detail to verify all assets were appropriately capitalized.

  1. Assemble an audit folder

To manage the volume of information we request, it may be helpful to compile items in one folder throughout the year for the audit team. These items could include new lease agreements, line of credit renewals, correspondence with regulators and lawsuit correspondence. The year-end request information can be saved with those documents already set aside during the year.

  1. Evaluate internal controls

Review your internal control procedures as well as the prior year management letter, and correct any deficiencies. Some areas to focus on include segregation of duties, managerial review or physical safeguards. Document the controls that are in place. Following these steps can improve the company’s internal structure and will give us a good understanding of procedures in place.

  1. Review recent accounting rule changes

Read over the new accounting rule modifications and standards and evaluate if they are applicable to your entity. See our recent article, New Accounting Standards Your Organization Needs to Know, for a brief description of key changes.

If you need help preparing for your audit, please contact Emily Campbell at (317) 613-7873 or email

5 Things You Need to Know About the New Not-For-Profit Accounting Standard

Emily CampbellBy Emily Campbell, MPA
Staff, Audit and Assurance Services

Last August the Financial Accounting Standards Board (FASB) released the first major changes to Not-for-Profit financial reporting since 1993. Accounting Standard Update 2016-14 includes significant impact to the look of financials for nonprofits.

If you are in a leadership position or on the board of a not-for-profit, you need to be aware of how this will affect your organization’s financial reporting process. Here are the Top 5 things you need to know about ASB 2016-14:

  1. Net Assets

ASU 2016-14 changes the net asset class structure from Unrestricted, Temporarily Restricted, and Permanently Restricted to Net Assets without Donor Restrictions and Net Assets with Donor Restrictions. This update removes the distinction between temporarily and permanently restricted net assets in an effort to simplify restrictions. In addition, FASB eliminated the “unrestricted” language to reduce confusion. Not-For-Profit entities will continue to report the change in total net assets for the period. They will also have to report changes in each of the two classes of net assets in their Statement of Activities.

  1. Expense Presentation

Not-For-Profit entities are now required to break out expenses by both nature and function. This was previously an option under GAAP, but now all entities must do so. The purpose of the update is to show how an entity’s expenses relate to their programs and to make Not-For-Profits more comparable. Additionally, investments are now presented net of investment expenses. Because of this, it will no longer be included in functional expense breakout.

  1. Statement of Cash Flows

Not-For-Profits may choose to present either the direct or indirect method of Statement of Cash Flows. If the direct method is selected by the entity, it no longer is required to prepare a reconciliation of the change in net assets to net operating cash flows. FASB’s intention was to decrease the burden placed on entities to present the same information in multiple ways. FASB also wanted to increase an entity’s flexibility to present the Statement of Cash Flows using the method that best suits the needs of the entity and its financial statement users.

  1. Increase in disclosures

Another big change with ASU 2016-14 is the enhanced disclosure requirements. The goal is to improve clarity and transparency in reporting. This includes an increase in net asset disclosures to enrich readers’ understanding of the donor restrictions. There will also be a new requirement to provide quantitative and qualitative information regarding the Not-For-Profit’s liquidity. The entity must communicate the availability of financial assets to meet cash needs for general expenditures for one year after the Statement of Financial Position date.

  1. Effective Date

ASU 2016-14 is effective for fiscal years beginning after December 15, 2017 and interim periods thereafter. Changes are to be retroactively applied, with options to omit analysis of expenses and disclosures of liquidity in the year of adoption. Early adoption is permitted, so reach out to a trusted financial expert to discuss whether early adoption is best for your Not-For-Profit.

Sponsel CPA Group has expertise in Not-for-Profit financial reporting, and can go over the new rules with you to find the best options for your organization.

If you have any questions regarding ASU 2016-14, please contact Emily Campbell at (317) 613-7873 or email

CPA Celebration Honorees

INCPAS honors

Tom Sponsel, Emily Campbell and Ryan Hodell (l-r) were honored at the 2017 INCPAS CPA Celebration on May 12.

The Indiana CPA Society (INCPAS) held their annual CPA Celebration on May 12th. Sponsel CPA Group had several team members recognized for their accomplishments.

Emily Campbell and Ryan Hodell were recognized for successfully passing the rigorous CPA Examination!! Tom Sponsel was recognized for reaching his 40th anniversary of INCPAS membership.

We would also like to congratulate Brandon Hoge, who has also successfully passed the CPA Exam. He will be recognized at next year’s CPA Celebration after attaining two years of public accounting experience.

We are very proud of all our team members, but want to congratulate those that were recognized at this annual INCPAS event!

Campbell joins firm

Emily CampbellEmily Campbell has joined the firm as a Staff accountant in the Audit & Assurance Services department. She previously served an auditing internship at a local firm, and has earned a bachelor’s degree in accounting and management information systems, as well as a master’s degree in professional accounting, both from Butler University. Her duties will include conducting audits, reviews, compilations and agreed-upon procedures. Welcome Emily!

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