Audits…The Old, The New & The Requirements – Emailed from CAPTA

It has been a long-time requirement for every PTA Unit, Council and District to conduct two audits of their financial records per year. The first is a mid-year audit, which covers the first six months of the fiscal year, and the second is an end-of-year audit which covers the last six months of the term.

As you prepare for your mid-year audit, we wanted to update you on some new requirements from our insurance company. These changes will help ensure more fiduciary accountability and protect your unit in the event of any insurance claims.Some audit requirements have not changed:

1) The auditor needs to be appointed by or elected to the Executive Board per your bylaws.
2) The auditor cannot be related to any of the check signers by blood or marriage, nor live in the same household.
3) The audit must be presented to the Executive Board as well as the General Association for adoption.This year there is one new requirement to the mid-year and end-of-year audits:The audit must reviewed by an audit review committee unless the audit is conducted by a qualified accountant. 

What is the definition of a qualified accountant? A qualified accountant is someone who has been trained/licensed to conduct audits and/or review accounting records, such as a Public Accountant or Certified Public Accountant (CPA). They do not need to be currently employed in the field.The audit review committee must be made up of at least two people and may include the auditor. The committee needs to review the work of the auditor and then sign the audit report. Once this has been completed, the audit must be presented to the Executive Board as well as the General Association for adoption.

Monthly Financial Review Requirements:It has always been required that bank statements be opened by a non-check signer and then reviewed, signed, and dated. In addition, our insurance company has a new requirement that the monthly bank reconciliation be reviewed, signed, and dated by a non-check signer. It can be the same person who reviews the bank statement, but it needs to be done monthly.

It is important to follow these new guidelines to protect your insurance coverage. Coverage may be voided if the above requirements and conditions are not met.

To review all the guidelines for conducting a PTA audit, as well as the audit checklist and form, click here.
Insurance premiums are due to your Council and District now. Unit premiums are $232, Council and District are $160. Please check exact dates with your Council.Here is a link to the updated Insurance Guide.