Monthly Archives: June 2018

End of Financial Year Preparation

It is nearly Happy New Year time for prepares of financial statements within the Church.

The Independent Assurance Policy (audit or review) for financial statements has not changed from last year and can be downloaded from HERE. It has already been sent out as part of the annual statistics package in May 2018.  In summary, if your operating payments are under $500,000 then the Church does not require an audit or review (but you can still have one done if you choose to. If your operating payments are between $500,000 and $1,000,000 then the financial statements need to be reviewed by a qualified person (normally a Chartered Accountant in Public Practice).  For operating expenditure greater than $1,000,000, then an audit is required to be undertaken by a qualified person (normally a Chartered Accountant in Public Practice).

If you do have an audit or review undertaken, then the auditor or reviewer is required by the assurance standards to also issue a “management letter” or “business issues” report.  This must also be submitted with your annual accounts to the General Secretary.

Please remember that the financial statements need to be prepared using the appropriate financial reporting standards issued by the External Reporting Board (Tier 1, 2 , 3 or 4).   If you need support in the preparation of these, then the Connexional Office is able to assistance.

Things to note are:

  • If you are using Xero, please make sure that all bank transactions are coded and that the bank accounts are fully reconciled.
  • If you have MTA and CB&L accounts, then please make sure that journal entries are undertaken to balance these accounts with the statements you have received from the Connexional Office.  These statements may not appear until the second or third week of July.
  • If you have any loans outstanding, once again undertake the necessary journal entries to balance these off with the appropriate interest paid and capital repayments journaled.
  • Were there any large repairs and maintenance items that should be capitalised as a fixed asset or did you purchase new furniture, computers, etc. that need to be on the fixed asset register?
  • If you have fixed assets, has depreciation been run and entered into the accounts.
  • Cast your eye over the entries going through the bank accounts to make sure they have been allocated to the correct accounting code.
  • Has GST been claimed on only those tax invoices that have GST on them and that tax invoices are in the files?
  • Have services that the Church has provided (hire of hall, etc.) been correctly charged.
  • Look at and start documenting your Outcomes and Outputs that your Parish has undertaken in the year.