Policy 21

Periodic audits of LISECC financial records

This policy statement implements a motion passed July 8, 2018 at a regular meeting of the Board of Directors. This policy attempts to address several issues regarding outside review of LISECC’s financial transactions:

  • Periodic audits by an outside CPA are an important tool for Board and Member oversight of LISECC. 
  • These audits can be costly, and funds need to be provided for in each year’s draft budget prior to the AGM.
  • The Board traditionally makes a recommendation to the membership each year as to whether an audit is advised, however it is the membership that makes the final decision via the AGM voting process.
  • It should be possible to set aside less than the full audit expense amount every year, accumulating funds for those years in which the membership votes to have an audit performed.

Therefore, LISECC shall:

  • Establish as Audit Savings Account to accumulate funds allocated for an audit through the budget process.
  • Beginning with the year 2020 draft budget, the Board will include in each year’s budget an amount equal to ½ of the anticipated current year audit expense.
  • Unless the Board determines there is a compelling reason for a more or less frequent audit cycle, the Board will recommend to the Members that LISECC have an audit completed every two years.
  • When accumulated funds held in the Audit Savings Account exceed two times the current estimated CPA audit expense, any excess funds will be transferred into LISECC’s unallocated reserve account.

Effective 8 July 2018. 
Approved by the Board of Directors in regular session, 8 July 2018. Leslie Dempsey, President.