GASB/Finance
A Month-by-Month Municipal Audit Preparation Checklist for June-30 FYE Cities
7 min read · GASB/Finance
Why You Need a Month-by-Month Audit Checklist
For municipalities with a fiscal year ending on June 30, preparing for an audit can be a daunting task. This month-by-month checklist is designed to simplify the process, ensuring all critical tasks are completed efficiently, from evidence retention to preparing the PBC list.
July to September: Initial Preparations and Strategy
Start your audit preparations early by reviewing the previous year's audit findings. July is a great time to strategize and allocate responsibilities for the current audit. Meet with your finance team to discuss last year's challenges and areas for improvement. Begin evidence retention efforts by organizing financial records and transaction backups for easy access.
October to December: Mid-Year Reconciliations and Reviews
- Conduct mid-year financial reconciliations to ensure all accounts are balanced.
- Review internal controls and address any discrepancies.
- Begin drafting the PBC (Prepared by Client) list with a focus on common audit findings.
- Ensure all financial records are updated and stored securely for evidence retention.
These steps are crucial for identifying and resolving issues early, which can streamline the audit process.
January to March: Fine-Tuning and Final Preparations
With the audit season approaching, it's time to fine-tune your preparations. Review the PBC list with your team and make necessary adjustments. Ensure all reconciliations are up to date and double-check for any missing evidence. This period is also ideal for conducting a mock audit to understand potential gaps in your documentation.
April to June: Finalize and Submit
- Finalize the PBC list and ensure all items are thoroughly documented.
- Conduct a final review of all reconciliations and financial statements.
- Submit required documents to the auditors well ahead of the deadline.
- Prepare for auditor queries by organizing supporting documents for each PBC item.
Common Audit Findings and How to Avoid Them
Many small finance teams encounter similar issues during audits, such as incomplete reconciliations, inadequate documentation, and lack of internal control evidence. Address these potential findings by maintaining thorough records and performing regular checks throughout the year.
Conclusion: Stay Ahead with Strategic Planning
By following this month-by-month municipal audit preparation checklist, cities can minimize stress and improve their audit outcomes. Proactive planning and continual improvement are key to a successful audit experience.
Frequently asked questions
- Why is early preparation important for municipal audits?
- Early preparation helps identify and address issues before they become problematic, ensuring a smoother audit process and reducing stress for finance teams.
- What common findings can small finance teams avoid?
- Common findings such as incomplete reconciliations and inadequate documentation can be avoided by maintaining thorough records and regular checks throughout the year.