Video instructions and help with filling out and completing Are Form 8815 Audit

Instructions and Help about Are Form 8815 Audit

Welcome to the Illinois PTA video series PTA essentials a series of brief videos that cover the basics of running a PTA a unit this PTA essentials video covers your PTA audit we will begin with one to perform an audit your PTA should do an audit at the end of your PTA fiscal year for many PTA s this will be June 30th but check your bylaws for what your fiscal year is you also perform an audit when there is a change in signatories on your PTA checking account at a time other than the end of the fiscal year or whenever you suspect there might be a problem with the PTA accounts so how do you do an audit the makeup of your audit committee is specified in your PTAs bylaws the bylaws will also specify who elects or selects the audit committee members you want at least three people on your audit committee members of the audit committee cannot be signatories to the PTA checking account this means that the treasurer likely cannot be a member of the audit committee but they should plan to attend the audit anyway to answer any questions the committee has your PTA may use an outside auditor if your bylaws specify that that is a possibility your PTA may have a member who is an accountant or other financial professional who volunteers their services with a PTA on it however you need to be sure that your auditor is familiar with nonprofit requirements PTAs have run into trouble in the past when a helpful auditor files additional forms that larger nonprofits must file but that PTAs generally do not need to when this happens PTAs are often locked into finding those additional forms annually thereafter with penalties when they fail to do so if a PTA has a gross income which is the total amount of money coming into their PTA for the fiscal year that is greater than $300,000 Illinois law requires that an outside auditor be used here is a sample report form you can find this on the Illinois PTA website at Illinois PTA org among the treasurer materials under the leadership resources menu item you can also find a copy in the local unit packet sent to your PTA president at the beginning of the school year here is the top of the audit report form it contains the entry that the Audit Committee will fill out as they perform the audit let's step through them at the top you need to specify the dates that the audit covers in most cases these would be the date of the most recent audit and the date that this audit is being performed the dates could also be the starting and ending date of your PTAs fiscal year if you are doing an annual audit the audit committee fills in the balance on hand from the most recent audit assuming you are using this report form this value would be taken from line four from the most recent audit report line one is where the audit committee records all of the income to the PTA since the most recent audit this includes all fund raisers donations and PTA dues including Illinois PTA and National PTA dues if the audit is for an entire fiscal year this value is the PTAs gross receipts a figure you will need to determine which IRS Form 990 your PTA will need to file for this fiscal year add the value from line 1 to the value above to get the total cash that the PTA had to work with during the audit period and record this value on line 2 line 3 is where the audit committee will record the PTAs total disbursements since the most recent audit these are all the expenses that the PTA had during this period the audit committee then subtracts the value in line 3 from the total cash value in line 2 to calculate the current balance on hand and records it in line 4 line five is the balance of the PTAs account at the end of its last bank statement prior to the audit date in this area the audit committee will record any checks that have been written but have not cleared the PTA account as of the last bank statement the value of these outstanding checks is then recorded in line six on line seven the Audit Committee records the total of any deposits that are not made that have not been credited the BDA account as of the last bank statement once these three lines have been filled out the Audit Committee subtracts the total outstanding checks in line six from the last bank statement balance in line five and adds the uncredited deposits in line seven this total is the balance in the checking account and it's recorded on line eight the value in line eight should be equal to the right above in line for the balance on hand if these two values are equal the audit committee is essentially done and just needs to complete the bottom half of the audit report which we will cover in just a minute if the two values are not equal the audit committee needs to determine what the discrepancy is and how it came about the difference between lines four and eight can provide the audit committee with some clues as it may be as simple as a check or Bank fee that wasn't recorded the audit committee needs to continue to work on explaining the discrepancy until aligns four and eight are equal once the audit committee has completed their work they need to fill out the bottom part of the audit report form the audit committee report that the audit found that the PTAs books to be correct meaning that lines four and eight were equal Stanly correct with the following adjustments this option is used when two