Every year we hire an accounting firm to conduct an independent auditor's report of all the financial operations of Grace Church. This annual investment is integral to maintaining a high standard of accountability in the way we handle our money. The independent audit usually consists of a 3-4 day site visit by a team of accountants. The team randomly picks certain months of the year and exhaustively reviews the income and expense records. In addition to many other tests they perform, they check to make sure expenditures have accompanying official receipts, that expenses have the proper signatures to authorize purchases and that expenses are correctly categorized (i.e. office supplies weren't categorized as a food purchase). If you ever wonder why you are asked for so much detail when requesting a reimbursement, it's because of the auditors :)
Another aspect of the site visit is individual interviews with our HR/Finance Assistant, Karen G., the Church Treasurer, Steve L. and me. These interviews consist of a lengthy questionnaire. With their vast experience, the accountants know the key signs of fraudulent activity and mishandling of funds. They grill us with specific questions about anything questionable that we've observed over the past year and ask us if we have any concerns about anything related to our financial operations. Each interview ends with the auditors giving each of us a free chance to report anything we find remotely questionable, suspicious or fraudulent pertaining to any person in the organization or any element of our operation.
The site visit is an intense scrutiny of everything we do. Though site visits normally carry a negative stigma, I actually look forward to the week. I recognize the value of being scrutinized by outsiders and look forward to learning how we can improve in our operations. Fortunately, all of the previous auditor's reports have come back positive with few, if any, qualifications. The report from the site visit in July 2005 was another positive report. As I usually do, I learned some new things we need to put in place and we're methodically working to get those implemented. I hope there is always something new for us to learn, something new to pursue.
Much of our success is due to the diligent work of the people who handle our finances. They often have to fill the role of communicating messages we don't want to hear - that my documentation was incorrect, I forgot a signature, I need my receipt, or my check was not written correctly. Their tenacity in insisting in having these details is what keeps us above reproach. I deeply appreciate their sacrificing their personal popularity for the sake of upholding our stringent processes. Without their sacrifice our systems are compromised.
Copies of the Independent Auditor's Report for the years ended June 20, 2005 and 2004 are available at the church office. Though not interesting reading to most, the document affirms that our financial reports are a fair representation of the church's financial position and found our operations to conform to accounting principles generally accepted in the United States of America.
