NFPs have four key areas to focus on in the lead up to the end of the financial year, according to Andrew Tickle, Partner, Audit & Assurance at BDO Adelaide.
Tickle said the financial information being reported has changed, with this year being the first time application of new accounting standards for revenue and leases.
“These were already expected to impact financial reports and COVID 19 has added an additional layer of complexity,” Tickle said.
“For the new revenue standards, identifying your specific performance obligations for grants and whether you’ve been able to meet them will be a key consideration as to whether revenue will be recognised or deferred.
“Whilst rent relief, deferrals and other amendments to lease contracts will need to be considered as part of the new accounting framework under leases.”
Tickle has other tips for financial reporting in the video.
The next area to consider is the ability of the NFP organisation to continue as a going concern.
“Organisations should be planning and preparing information to support their directors’ need to confirm the ability of the entity to pay its debts as and when they fall due, on signing of the accounts,” Tickle said.
This also brings up the need for the completion of accounts and audit.
“While the recent easing of restrictions is positive, teams should consider how best to work with their auditor to ensure the process can be completed in a timely and safe manner,” Tickle said.
“It’s likely there will be an increase in requests for documents to be provided electronically, and now is the time to consider your readiness for this.”
Lastly, Tickle said NFPs need to consider how to conduct their Annual General Meetings.
“Whilst restrictions have certainly eased, the ability to host AGMs may still be limited, depending on your circumstances,” Tickle said.
“The ACNC has recommended that organisations check their constitutions to make sure that technology is permitted for use.
“If it’s not, but you anticipate a need to use it, we recommend you discuss this with the ACNC as soon as possible.
“As you’ve no doubt experienced, holding meetings remotely can be pretty challenging, so preparing now will go a long way to ensuring that you have a productive and efficient AGM.”
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