Understanding Government and Nonprofit Auditing Risks

School districts, townships, municipalities and special districts make up roughly 90,000 local government entities throughout the United States that require an audit by a CPA firm. Additionally, more than 1.5 million tax-exempt organizations in the U.S. also require an audit at year-end. Audits of these types of organizations require planning, testing, and reporting requirements to …

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What is the Difference Between Donor-Advised Funds and Restricted Donations?

Donors advising on the use of their donation sounds relatively the same as donors restricting the use of their donation, doesn’t it? These are actually very different concepts. Donor advised funds are separately identified accounts that are maintained by a public charity. After the donor makes an unrestricted donation to the donor advised fund/account, the …

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IRS Creates1023-EZ Streamlined Application for Tax Exempt Status

For an organization to be recognized as a 501(c)(3) tax exempt organization, it is generally required to submit Form 1023 to the IRS. Form 1023 is a 28 page, time intensive form that may be difficult to complete for many smaller nonprofits. As a result the IRS is currently in the process of creating Form …

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Properly Identifying and Reporting Federal Funding

If your entity utilizes grant funding, it is important to identify if that funding is obtained from the federal government, whether by direct funding or a pass-through agency. Per Circular A-133 section 300, the grantee is responsible for identifying federal awards that must be reported on a supplementary statement to the financial statements: the Schedule …

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Determining Unrelated Business Income

In order to address cash flow problems, many not-for-profit organizations seek additional revenue streams in order to continue to carry out their missions.  But not-for-profit organizations should be aware of whether or not their activities are related to their organization’s exempt purpose. When activities are considered unrelated to the organization’s exempt purpose, the revenue earned …

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Are You Using Social Media To Achieve Your Marketing Goals? Part II

Now you have your marketing plan in place and some do’s and don’ts you are ready to get your accounts set up based on your target audience.  If you have defined LinkedIn, Twitter, Facebook and blogging as good social media tools for your organization read on to learn about some great resources for you to …

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Importance of an Audit Committee

It is a known fact that audit committees are an essential component in corporate governance.  The public has been increasingly focused on oversight and governance issues since the Enron scandal.  However these issues aren’t just for the “for-profit” industry.  It is becoming more and more of an issue for the not-for-profit world.  Since the re-vamp …

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Can Not-for-Profits Pay Commissions?

There are no hard and fast rules about when a not-for-profit organization may or may not pay commissions. The only guidance is the general consensus that it is ethically questionable for a not-for-profit organization to pay commissions to anyone in a fundraising capacity. It would be hard to justify paying a fundraiser (employee or contracted) …

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