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Internal Audit Tips for Churches: A Simple Guide

Key tips to simplify internal audits for churches and ensure a smooth process.

Marian V. Liautaud
Bio

Last Reviewed: January 26, 2025

Internal audits can help churches maintain financial integrity and transparency. Here are some key tips to make the process smoother and more effective.

1. Determine If an Audit Is the Right Fit

Before committing to an audit, assess if it is the best service for your church. In some cases, funds may be better allocated toward a financial review or consulting arrangement.

2. Build a Strong Relationship with Your Auditor

Your auditor should be a strategic partner with expertise in nonprofits and ministries. Establish a good working relationship to maximize the benefits of their services.

3. Be Involved in Major Decisions

Stay engaged with major decisions within the church and consider their accounting implications. Proactive involvement ensures accurate records and smoother audits.

4. Implement a Monthly Closing Process

A regular monthly closing process improves accounting accuracy and ensures you are well-prepared for audits throughout the year.

5. Communicate Audit Timing and Requirements

Discuss the audit timeline, potential issues, and requirements with your staff. Keeping everyone informed helps prevent misunderstandings and delays.

6. Set Clear Expectations with Your Auditor

Be upfront about timelines and expectations. Clear communication helps your auditor understand your needs and ensures an efficient process.

7. Prepare Thoroughly for Fieldwork

Allow ample time for preparation and have all necessary materials ready at the start of the fieldwork. Avoid preparing items during the audit, as this can cause delays.

8. Ask Questions Throughout the Process

If anything is unclear, ask your auditor for clarification. Open communication ensures you stay informed and reduces errors.

9. Be Available During the Audit

Availability is crucial during fieldwork and follow-up. Schedule time to address the auditor’s questions promptly, as unavailability can significantly slow the process.

10. Remember the Auditor’s Role

Keep in mind that you hired the auditor to help. They are there to support your church and ensure financial processes are in order.

FAQs
  • What is the difference between an audit and a financial review? An audit provides a comprehensive evaluation of financial records, while a financial review is less detailed and focuses on limited assurance.
  • How can I prepare for an internal audit? Implement a monthly closing process, communicate timelines with your staff, and ensure all records are organized before fieldwork begins.
  • Why is open communication with the auditor important? Clear communication ensures misunderstandings are avoided and the process runs smoothly.
  • How can I ensure the audit process is efficient? Prepare thoroughly, set clear expectations, and be available to address questions promptly during and after fieldwork.

For more information on financial management in churches, visit IRS Guidelines for Churches and Government Accountability Office.

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