Rural Water - Quarter 3, 2016 - 32


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TO BE PREPARED FOR YOUR AUDIT, KEEP YOUR

RECORDS NEAT, ORGANIZED, QUICKLY AVAILABLE AND WELL
DOCUMENTED, WHETHER IT IS TO BE A COMPILATION, A
FINANCIAL AUDIT OR A SINGLE ENTITY AUDIT.

and privately owned small businesses, but can be conducted on all
types of businesses, including a system that is required to have an
audit but does not meet the requirements for a single entity audit.
When conducting this type of audit, the accountant will look
at a sample of your financial documentation, invoices, receipts
and bank statements. They will also look at your record-keeping
policies and make sure your financial records reflect their use. They
will also make sure your records are being stored properly. You can
keep them electronically by photocopying them or by storing the
actual documents. Just make sure the archived records are easy to
get to and can be accessed quickly.
The accountant will also look at your accounting system and
how you make journal entries, if you are producing correct financial
statements and if a general ledger can be generated from the
system. It is important that you make sure you have everything
complete through your fiscal year end.
The next item the auditor will delve into is your internal controls
to ensure that they protect your company from theft and fraud,

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sales@adedgetechnologies.com

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32

THIRD QUARTER 2016

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7/13/16 1:22 PM

there is separation of duties, and there is adequate password
protection on your accounting software, to name a few. It is a
good idea to have your internal controls written and available for all
employees, not just your auditors. This is an important handbook;
it protects the company if something happens to the accountants
or management.
The auditor will also look at your cash holdings, how you expense
items (does it line up with your budget), how you handle your daily
receipts (is there a process that involves more than one person in the
accounting department), how you handle bank reconciliations, and
your receivables. Tax records will also be examined to make sure you
are making quarterly deposits on a timely basis.
This is a short list of items that the auditor will be looking at
when they come in to audit your records for a financial audit. To
make this process easier, keep your records neat, organized,
quickly available and well documented.
The fourth and last type of audit is the single entity audit or
an A-133 audit. This is the most rigorous, organization-wide audit
and is required if you have $750,000 or more of federal dollar
expenditures. If you do not meet this threshold, you will be able to
have a simpler financial audit.
You ask the difference between the financial audit and the
single entity audit? The answer is the compliance testing the
auditor will do. They will produce an opinion on the financial
and compliance components. This audit will assure the federal
government as well as management that your financials present
fairly your financial position and you are complying with the
requirements set forth in your agreements with the federal
government. The single entity audits are also required to file a data
collection form with the Federal Audit Clearinghouse, which is
available for the public to access.
Under this audit, the auditor will focus on financial records:
financial statements, federal award transactions and expenditures,
operations, and internal control systems. The focus on compliance
will cover the study and understanding on the agreements you
have and will then test and evaluate the federal assistance usage,
operations and compliance with laws and regulations. The financial
component will mirror what is looked at and examined under a
financial audit.
Under the single entity audit, the auditor will determine if each
federal program is audited or if a certain program(s) is (are) selected
to be audited. It should change from year-to-year and will also
change from client-to-client. This determination is done during the
planning stage and the examination stage.
To be prepared for your audit, keep your records neat,
organized, quickly available and well documented, whether it is to
be a compilation, a financial audit or a single entity audit. ‚óŹ


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Table of Contents for the Digital Edition of Rural Water - Quarter 3, 2016

The Latest Drinking Water Innovations
Potable Reuse of Water: A View from Arizona
Getting the Public on Board with Your Potable Water Reuse Plan
Recapturing Revenue from Water Loss
Water Depletion and the Customer
Boardroom Courtesy
From the President
Finance: Audit Requirements
Technology: The New System that Uses Sound to Alleviate Water Shortage
Emergency Management: Creating a Drought Response Plan
A Day in the Life of a Circuit Rider
Regulatory Update
Throwing My Loop: An Old Familiar Tune
Index to Advertisers/ Advertisers.com
Rural Water - Quarter 3, 2016 - cover1
Rural Water - Quarter 3, 2016 - cover2
Rural Water - Quarter 3, 2016 - 3
Rural Water - Quarter 3, 2016 - 4
Rural Water - Quarter 3, 2016 - 5
Rural Water - Quarter 3, 2016 - 6
Rural Water - Quarter 3, 2016 - 7
Rural Water - Quarter 3, 2016 - 8
Rural Water - Quarter 3, 2016 - 9
Rural Water - Quarter 3, 2016 - 10
Rural Water - Quarter 3, 2016 - From the President
Rural Water - Quarter 3, 2016 - The Latest Drinking Water Innovations
Rural Water - Quarter 3, 2016 - 13
Rural Water - Quarter 3, 2016 - 14
Rural Water - Quarter 3, 2016 - 15
Rural Water - Quarter 3, 2016 - 16
Rural Water - Quarter 3, 2016 - 17
Rural Water - Quarter 3, 2016 - Potable Reuse of Water: A View from Arizona
Rural Water - Quarter 3, 2016 - 19
Rural Water - Quarter 3, 2016 - 20
Rural Water - Quarter 3, 2016 - 21
Rural Water - Quarter 3, 2016 - Getting the Public on Board with Your Potable Water Reuse Plan
Rural Water - Quarter 3, 2016 - 23
Rural Water - Quarter 3, 2016 - 24
Rural Water - Quarter 3, 2016 - 25
Rural Water - Quarter 3, 2016 - Recapturing Revenue from Water Loss
Rural Water - Quarter 3, 2016 - 27
Rural Water - Quarter 3, 2016 - 28
Rural Water - Quarter 3, 2016 - 29
Rural Water - Quarter 3, 2016 - 30
Rural Water - Quarter 3, 2016 - Finance: Audit Requirements
Rural Water - Quarter 3, 2016 - 32
Rural Water - Quarter 3, 2016 - 33
Rural Water - Quarter 3, 2016 - 34
Rural Water - Quarter 3, 2016 - Technology: The New System that Uses Sound to Alleviate Water Shortage
Rural Water - Quarter 3, 2016 - 36
Rural Water - Quarter 3, 2016 - Emergency Management: Creating a Drought Response Plan
Rural Water - Quarter 3, 2016 - 38
Rural Water - Quarter 3, 2016 - 39
Rural Water - Quarter 3, 2016 - A Day in the Life of a Circuit Rider
Rural Water - Quarter 3, 2016 - 41
Rural Water - Quarter 3, 2016 - 42
Rural Water - Quarter 3, 2016 - Water Depletion and the Customer
Rural Water - Quarter 3, 2016 - 44
Rural Water - Quarter 3, 2016 - Boardroom Courtesy
Rural Water - Quarter 3, 2016 - 46
Rural Water - Quarter 3, 2016 - 47
Rural Water - Quarter 3, 2016 - Regulatory Update
Rural Water - Quarter 3, 2016 - 49
Rural Water - Quarter 3, 2016 - 50
Rural Water - Quarter 3, 2016 - Throwing My Loop: An Old Familiar Tune
Rural Water - Quarter 3, 2016 - 52
Rural Water - Quarter 3, 2016 - 53
Rural Water - Quarter 3, 2016 - Index to Advertisers/ Advertisers.com
Rural Water - Quarter 3, 2016 - 55
Rural Water - Quarter 3, 2016 - 56
Rural Water - Quarter 3, 2016 - 57
Rural Water - Quarter 3, 2016 - 58
Rural Water - Quarter 3, 2016 - cover3
Rural Water - Quarter 3, 2016 - cover4
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