Posts Tagged ‘Mike Bedel’

The Real Purpose of Your 401(k) Audit

Mike BedelBy Mike Bedel, CPA, MBA, CGMA
Partner, Director of Audit & Assurance Services

If your company’s 401(k) plan has more than 100 eligible participants, it is large enough that the U.S. Department of Labor requires an audit of your plan. This audit must be attached to your annual 5500 filing, but is often viewed as an unnecessary compliance cost by the 401(k) plan sponsor.

The true purpose, however, for the required audit of this employee benefit plan is to protect various stakeholders in the plan, especially the plan participants.

Many employees rely on their 401(k) plan to save for retirement. Many expert resources such as Forbes describe it as “the single best wealth accumulation vehicle available to the vast majority of Americans.”

However, most employees are not well-versed in how their 401(k) plan operates. As a result, they may not be aware if their personal accounts are not being appropriately credited for their contributions.

By taking the audit process seriously, the plan sponsor communicates that they understand the value their employees place on the wealth they’ve accumulated in their individual 401(k) accounts. When a plan sponsor makes decisions that minimize the role of the audit, they are perceived by their employees as not valuing the hard-earned money set aside over the years – or even as putting their own interests ahead of the employees’.

The Department of Labor and the Internal Revenue Service continue to emphasize the importance of fiduciary responsibility to those involved in the management of the retirement plans. They also stress the importance of a thorough and complete audit process as a significant means of oversight on the plan’s operations.

Additionally, the audit provides some protection to a fiduciary of the plan who is taking their role seriously. It is a way for them to act upon their responsibilities to protect the plan. And it serves to identify if the plan is operating outside of compliance with regulations from the DOL or IRS.

Sponsel CPA Group performs audits of defined contribution employee benefit plans, such as 401(k) plans. We take this responsibility very seriously and value the role we play in protecting the interest of all stakeholders for the plans we audit.

If you have questions about audits of 401(k) plans, please contact Mike Bedel at (317) 613-7852 or email


Changes to Auditing Standards for Going Concern

Mike BedelBy Mike Bedel, CPA, MBA, CGMA
Partner, Director of Audit & Assurance Services

The AICPA Auditing Standards Board (ASB) has updated their standards on the topic of Going Concern. Statement on Auditing Standards (SAS) No. 132 was issued in February 2017 under the title, The Auditor’s Consideration of an Entity’s Ability to Continue as a Going Concern.

The term “going concern” relates to the expectation that an entity will continue operations in the future. It is often taken for granted, or assumed, that the entity under audit will continue operations in the near future.

These new standards supersede previous guidance that existed for auditing standards, SAS No. 126 (under the same title), and follows recent pronouncements on the same topic by the International Auditing and Assurance Board. In 2014 Accounting Standards Update 2014-15 was issued to place the initial responsibility to identify a going concern on management, before the auditor is required to address the topic.

This most recent update is effective for audits of financial statements for the year ending December 31, 2017.

SAS No. 132 aligns the previous standards more closely with the responsibility placed on management by ASU 2014-15. It also aligns the auditing standards with standards recently issued by the Governmental Accounting Standards Board (GASB).

SAS No. 132, clarifies that the auditor is responsible to determine whether management has appropriately utilized a going concern basis of accounting and whether there are any substantial doubts about the entity’s ability to continue as a going concern in the near future.

SAS No. 132 also adds a requirement to evaluate the reliance upon third parties, owners or management in the organization’s plans to continue as a going concern.

For more information about the topic of Going Concern, please contact Mike Bedel at (317) 613-7852 or email

When You DON’T Need an Audit

Mike BedelBy Mike Bedel, CPA, MBA, CGMA
Partner, Director of Audit & Assurance Services

There are many compelling reasons to have an audit performed on your financial statements. But there are also many reasons to NOT have an audit.

As director of our audit and assurance services department, I often receive phone calls from clients and potential clients who begin the conversation with, “We need an audit for our organization.”

My response is to always ask, “Why?” Very often, I quickly find their organization does not really need an audit. Nearly always, some level of professional service is appropriate – but it is very often not an audit.

Here are some of the common scenarios that occur when leaders think their organization needs an audit – but really doesn’t.

  • Suspicion of Fraud. When the suspicion of fraud rises at an organization, one of the knee-jerk reactions from board members or management is to request a financial statement audit. However, an audit is not designed to detect fraud. In this situation, we recommend that clients engage our forensic accounting services. They specialize in detecting fraud.
  • Improving Efficiency. A growing organization will often come to a point where their governing board recognizes a need to review and improve the efficiency of their finance and accounting function. In this situation, a consulting engagement typically becomes the most efficient use of the organization’s resources to identify past issues with internal controls and recommend ways to improve them. While an audit does take the internal control environment into consideration as part of developing an opinion on the overall financial statements, it is not designed to provide an opinion on those internal controls or design an improved accounting process.
  • Valuation. When a transfer of ownership is being considered, sometimes the current or future owners will seek an audit to help substantiate the value of the organization or ownership shares. While an audit opinion will provide assurance on the overall financial statements for a historical period, the audited financial statements are not designed to determine the current or future value of the enterprise. In these cases, our valuation services are most useful to clients. Valuation is an area of accounting that requires very specific knowledge and experience; Sponsel CPA Group has its own outstanding team of valuation experts. An audit can be a useful resource to a valuation specialist, but the audit itself is not the answer to determining the value of an organization.
  • Other Levels of Service. Lenders, such as banks and other financial institutions, often require financial reporting for the financial statements when there is an outstanding loan. Depending on the size of the loan and the risk assessed by the lender, they are often satisfied with a lower level of service than an audit. Namely, a compilation or review of the financial statements is sufficient for lenders in many cases, and should cost less to the organization than a full audit.

Now is a good time to review what an audit IS designed for.

A financial statement audit is designed to provide assurance on a set of financial statements. In an audit, an independent CPA issues their opinion that the financial statements are free of material misstatement. This provides assurance for stakeholders such as owners, lenders, members and others that the financial information reported with the audit is reliable and allows them to manage their various risks.

Most often, we see that audits are required by significant lenders or by donors to non-profit organizations to provide them certainty that the financial results reported to them are reliable and can be used in their decision-making processes.

When an audit is appropriate, we are at the ready to help and serve our clients! Because we value our client relationships, however, we always seek to understand what is truly needed so that we are providing the best value to our clients and not selling them a service they don’t need.

If you think your organization needs an audit — or something different than an audit — please contact Mike Bedel at (317) 613-7852 or email

Leaders: Do You Have a Vision?

Mike BedelBy Mike Bedel, CPA, MBA, CGMA
Partner, Director of Audit & Assurance Services

If you’re the leader of any organization, one of your most critical responsibilities is to have a vision for the future. It may sound obvious, but many leaders are so focused on dealing with the current situation or rectifying past mistakes that they fail to sufficiently look ahead.

Assuming you do have a vision for the future, you need to be planning the steps necessary to make that vision a reality. Once that vision and process are in place, you must communicate them to your entire organization in order to have the best possible chance of achieving that vision successfully.

Your vision process must become a daily stepping stone to the future you seek.

Many agree that the best way to learn is from mistakes. If we don’t take the time to examine missteps, we are more likely to repeat them. So looking back at your organization’s history can be very bountiful.

Be mindful, however, that looking at the past doesn’t blind you from looking to the future. Don’t dwell on past mistakes at the expense of establishing a vision.

As we start a new year, this is a great time to focus on critical aspects of your operation –financial performance, expected capital expenditures, maintaining or increasing your workforce, market trends, changes to your culture, etc.

To establish or refine your vision, start by asking yourself: where is the organization today? Where do you want it to be in 12 months? What are the milestones necessary to get from here to there? The answers you come up with will lay the foundation for your vision and process.

External factors can and should influence your vision. You probably have trade organizations or industry publications that can help educate you on the expected trends for this year and beyond.

There is new leadership coming to the White House in Washington D.C. and the statehouse here in Indiana. However you feel about the election results, it’s incumbent upon the leader of an organization to think about how that political change could impact their future.

The best leaders are constantly forward-thinking. They clearly articulate and communicate their vision to those they lead. Assuming that your vision requires efforts across the entire organization, it does no good to have a plan for the future if you’re not sharing it, promoting it and making it a critical part of your daily work plan.

Understand that the employees of any enterprise expect their leaders to point the way.

Make sure you have established a vision for 2017 and beyond. Ensure it is clearly communicated to everybody in your organization so that they can all help achieve that vision. Don’t let the daily grind push this essential task away into the future.

This is where a lot of leaders fall down. Either they haven’t formulated a vision, don’t define the path to make it happen or fail to share it with the very people who will carry it out.

The purpose of a vision is to help ensure that the future is an improvement over the past. That’s all anyone can hope for, whether in their personal life or their professional endeavors. That is exactly what Sponsel CPA Group hopes for your organization in 2017.

Good Luck and hopefully your vision for 2017 and beyond will become a successful reality!

If you need help with crafting your vision for your company’s future, please contact Mike Bedel at (317) 613-7852 or email

Employee Spotlight: Mike Bedel

Mike BedelMike Bedel was a young CPA moving up in a large local company when he jumped at an opportunity to start a new firm and oversee its Audit & Assurance Services department. The four partners were so impressed with his knowledge and dedication to serving clients that they invited him to join them nearly three years ago, and since then he has held the title of Partner as well as Director of Audit & Assurance.

In additional to being a CPA and MBA, Mike holds a certification as a Chartered Global Management Accountant (CGMA). He earned both his bachelor’s and master’s degrees in Business Administration from the University of Dayton.

He leads the audit team in providing clients with the financial information they need to be secure and successful in their business and personal dealings. His duties include audits, assurance services, financial statements and consulting across a broad range of industries, including acting as CFO and Controller for several companies in the Indianapolis area.

Mike is active in the Indiana CPA Society, and is currently Chairman of the board of trustees of their political action committee. He also volunteers as Treasurer for Cub Scout Pack 394 at St. Susanna Church in Plainfield and as Secretary of the School Commission for St. Susanna Catholic School.

Mike and his wife of 11 years, Ellice, have five children: Adam, 10; Isabelle, 8; Anna, 6; Sophie, 3; and baby Genevieve, whom they welcomed six months ago. They also have a 95-pound Goldendoodle, Milo. The family enjoys camping and hiking, and Mike likes assisting Ellice with her work in the Youth Ministry at St. Susanna.

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