There are times when non-profit organizations need to have bookkeeping services to help keep records orderly for tax compliance and to secure funding. We can help in this arena too, because No Doubt Accounting offers compilation services to non-profits.
Frequently, non-profits are held together by superb, well-meaning people who may know much about their goals but less about how to keep their finances in order. This can lead to trouble when tax time comes. See our article about common bookkeeping mistakes made by manu nonprofits.
The benefit of a compilation is to have an expert look at a non-profit’s financial record and head off an IRS audit.
A compilation is different from a review or audit in that it’s carried out by the non-profit itself and is limited in its goal and method. It may consist of financial records that encompass a month, quarter, or entire year of time, and the expert hired by the non-profit to organize the financial information should do so in the format required by GAAP (generally accepted accounting principles). In some cases, the expert may also provide notes of explanation when reviewing financial statements, or find and bring to light questions about the non-profit’s records, but does not report these things except to the non-profit. Such questions are solely for the purpose of helping the non-profit identify irregularities that would otherwise cause problems when reviewed by a third party, be it the government or a bank that may be considering making a loan to the non-profit.
A compilation’s limited nature means it offers no guarantees, and for that reason isn’t an absolutely necessary part of a non-profit’s financial organization. However, it’s far cheaper than a review or audit, and given the problems it can help avoid is worth doing. That way the non-profit can stay focused on its target.
We can make sure your non-profit organization is in compliance with IRS requirements.