The request list is not a surprise. Nearly everything on it can be assembled, reconciled and documented before the auditor arrives — and the organizations that do so consistently spend less on the engagement and receive fewer findings.
Begin with reconciliations. Every balance sheet account should reconcile to independent support, with the supporting schedule filed alongside it rather than recreated on request.
Restricted funding needs its own treatment: releases from restriction, remaining balances by award, and documentation tying expenditures to the terms of each award.
Internal controls should be documented before they are asked about. A written description of who authorizes, who records, who holds custody and who reconciles — plus the compensating controls where those overlap — answers a substantial portion of the auditor's inquiry.
Finally, decide in advance who inside the organization owns communication with the audit team. A single point of coordination prevents duplicate requests, conflicting answers and the delays those create.
This article is general information for nonprofit leaders and is not legal, accounting or tax advice. Requirements change; confirm current guidance for your organization's fiscal year before acting.
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