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Expected changes in auditing standards and Form 990 reporting for
nonprofit organizations may require increased data gathering and raise the
cost of audits. These changes are expected to have an impact on some CASA
and GAL programs. National CASA recommends that member programs contact a
tax professional or auditor for more information.
Among these changes is the new Suite of Risk Assessment Audit Standards (AICPA
Statement on Auditing Standards Nos. 104-111). Below are a few points about
the standards.
- These new standards are designed to improve the quality of audits and
enhance reliability of financial statements.
- They are a result of the "trickle down" from the Sarbanes-Oxley Act
and associated changes in the business world to promote openness and
accountability.
- These standards require that organizations provide auditors with
complete documentation of internal financial controls either prior to or
during the audit.
- These standards also require that auditors conduct increased testing
of internal controls.
- Auditors will no longer audit just the numbers but also how the
numbers were arrived at.
Beginning this year, small organizations have a new filing requirement as
a result of the Pension Protection Act of 2006. Tax-exempt organizations
that normally have annual gross receipts of $25,000 or less have not been
required to file Form 990 or 990-EZ. Now these programs must file a new
electronic form—Form 990-N, more commonly known as the e-Postcard.
Please be aware the IRS is currently working on a revision to Form 990
starting with the 2008 fiscal year (filing in 2009). The expected revision
may require more administrative time to gather necessary information to
comply with the revised form. This additional data-gathering burden may in
turn increase Form 990 preparation costs.
For more detailed information, visit the “Charities & Non-Profits” tab at
irs.gov.
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