- An audit doesn’t just help the organisation be accountable, it also allows it to be seen to be accountable
- An NFP and its auditor can build a mutually beneficial relationship that can add value to the effective governance of the organisation and the achievement of its objectives
- Ensure you make the most of all the skills, abilities and experience your auditor can provide
Just pick up the phone is the blunt advice from Craig Fisher FCA on how to build a good relationship with your audit team.
“A five-minute conversation can save huge time and effort unravelling something that’s more advanced later,” he says. “An audit is not just a once-a-year relationship. It’s an ongoing partnership.”
As a former audit partner and now consultant to RSM NZ, Chairman of the Fred Hollows Foundation New Zealand, and a board, council and committee member of a string of New Zealand business, government and charity organisations, Craig knows the audit process intimately.
He lent his expertise to Chartered Accountants ANZ’s new guide Maximising the value of audit – A guide for not-for-profits and charities, along with Jamie Cattell CA, project manager at the External Reporting Board (XRB), Wellington, Russell Postle FCA, business services consultant to the Brisbane office of BDO Australia, and Laurensia Rosana CA, finance manager at the Perth-based Australian Inclusion Group Ltd.
The guide is designed to help not-for-profits and charities maximise the value of an audit and to recognise that the process can be much more than a perfunctory compliance exercise.
As the guide explains, with the right approach, an auditor can become a valued independent partner, helping the organisation to advance. The auditor’s impartiality and objectivity are key to the process.
The guide emphasises that the audit doesn’t just help the organisation to be accountable, it critically also allows it to be seen to be accountable. The independent process shows key stakeholders, including donors, regulators and banks the impact of the organisation and the adequacy of its financial controls.
“A five-minute conversation can save huge time and effort unravelling something that’s more advanced later. An audit is not just a once-a-year relationship. It’s an ongoing partnership.”
As a director and chair of the finance and audit committee of the Queensland section of the Royal Flying Doctor Service of Australia, Russell also brought his experience of both sides of the audit process to the guide.
“The best outcomes always flow from a good working relationship between the client and the audit team,” he says. “The relationship should be open, respectful and built on trust.”
An auditor in a previous role, Laurensia says she looks forward to her organisation’s audit as an opportunity to benchmark her practice.
“The audit team is not your enemy,” she says. “They are there to ensure you are keeping up with industry best practice. That’s why you should be robust in the tender process to find the best auditor for your organisation.”
Craig adds that because auditors have broad experience and knowledge of other organisations, without breaking confidentiality of their clients’ businesses, they can identify and provide advice on best practice in the industry.
“Many not-for-profits are usually resource-poor and accustomed to living hand-to-mouth,” he says. “They often don’t have the time or means to look out for the most cost-effective way to achieve outcomes.”
That’s why finding the right auditor for your organisation is crucial. “Be attuned to how willing they are to get to know your charity and how interested they are in what you do,” he adds. “If they really understand your aims, they will provide much greater value.”
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