Audit Readiness

Audit-Ready. Always

We prepare your organization with the controls, documentation, and financial discipline needed for a smooth, efficient audit process

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Audit Readiness Services for Non-profits and select Public service sector entities

We provide audit readiness services for nonprofit organizations and select public service sector entities, including municipalities and grant-funded programs, ensuring compliance with FASB and GASB standards and federal Uniform Guidance requirements.”
At Stratum Financial Consultants, our Audit Readiness Services are designed to provide end-to-end support, integrating regulatory requirements, internal controls, and audit preparation into a fully managed, structured process.

We don't just advise we implement, monitor, and support execution, ensuring your organization is fully prepared for financial audits and Single Audits.

Audit readiness ensures efficient, low-risk audits with accurate records, robust controls, and complete documentation. Non-profits follow FASB GAAP (ASC 958); public sector entities (PSEs) follow GASB standards and often Government Auditing Standards (Yellow Book). Entities expending ≥$1,000,000 in federal awards (threshold effective for fiscal years beginning on/after October 1, 2024) require a Single Audit under Uniform Guidance (2 CFR 200).

Non-Profit-Specific Focus Areas

  • Net assets with/without donor restrictions and proper releases
  • Functional expense allocation (programs, management, fundraising)
  • Revenue recognition (contributions vs. exchange transactions; ASU 2018-08)
  • Grant compliance and accurate SEFA
  • Reconciliation to Form 990
  • Governance documentation (board oversight, conflicts, compensation)

Public Sector Entity-Specific Focus Areas

  • Fund accounting and compliance with recent GASB standards (e.g., 87 Leases, 96 SBITAs, 94 P3s)
  • Budget-to-actual reporting at legal level
  • Pensions (GASB 68), OPEB (GASB 75), and debt
  • CAFR components (MD&A, RSI, statistical sections)
  • IT and cybersecurity controls

Single Audit Preparation

The Single Audit includes financial audit, compliance testing for major programs, and internal control reporting, guided by the OMB Compliance Supplement (use 2025 version).

Our Framework

Fully Integrated Audit Readiness Framework

01

Audit Applicability & Regulatory Assessment

We ensure your organization clearly understands audit requirements and thresholds.

  • Track and monitor federal expenditures monthly to determine audit applicability
  • Confirm Single Audit threshold (≥ $1M federal awards)
  • Assess regulatory framework (FASB, GASB, Uniform Guidance)
  • Review grant agreements and compliance obligations
✓ Track federal expenditures monthly✓ Review grant terms and requirements
02

Financial Close, Reconciliations & SEFA Preparation

We ensure financial data is accurate, complete, and audit-ready.

  • Perform and review monthly and year-end reconciliations
  • Prepare lead schedules and supporting documentation
  • Develop and maintain quarterly SEFA (Schedule of Expenditures of Federal Awards)
  • Reconcile SEFA to the general ledger with required disclosures (ALN, subawards)
  • Ensure accurate cutoff, accruals, and financial reporting alignment
✓ Draft SEFA quarterly✓ Prepare reconciliations and lead schedules
03

Internal Controls Design, Documentation & Testing

We build and validate a strong internal control environment.

  • Document processes through walkthroughs, narratives, and flowcharts
  • Design and implement internal controls over financial reporting and compliance
  • Perform segregation of duties analysis
  • Conduct internal control testing and periodic reviews
  • Update policies and procedures based on findings
✓ Conduct walkthroughs for key cycles✓ Perform internal control testing✓ Update policies and procedures
04

Compliance Testing & Program Monitoring

We ensure compliance with federal and regulatory requirements.

  • Test key compliance areas: allowable costs, eligibility, procurement, reporting, time and effort tracking
  • Conduct subrecipient risk assessments and monitoring
  • Develop compliance documentation aligned with Uniform Guidance
  • Ensure proper tracking and reporting of grant activity
✓ Test compliance areas (time & effort, procurement, reporting)✓ Perform subrecipient monitoring
05

Audit Documentation & PBC Management

We centralize and manage all audit-related documentation.

  • Build and maintain a centralized audit repository
  • Create and manage a Prepared-by-Client (PBC) tracker
  • Compile financial records, grant agreements, payroll and procurement documentation, board minutes and governance records
  • Ensure audit trail, version control, and completeness of documentation
✓ Prepare board minutes and documentation✓ Establish centralized PBC tracker
06

Single Audit Preparation & Major Program Readiness

We fully prepare your organization for Single Audit execution.

  • Perform Type A/B program classification and risk assessments
  • Anticipate major program selection
  • Prepare detailed SEFA and supporting schedules
  • Document and test controls across the 12 compliance requirements
  • Align documentation with OMB Compliance Supplement (2025)
  • Review prior findings and remediate
✓ Anticipate major program determination✓ Prepare SEFA and compliance documentation
07

Pre-Audit Mock Review & Readiness Testing

We simulate the audit before it begins.

  • Conduct mock audits and readiness reviews
  • Identify gaps and potential audit findings
  • Test key financial cycles and compliance areas
  • Deliver a pre-audit issue log with remediation actions
✓ Conduct walkthroughs✓ Identify and remediate risks early
08

Audit Coordination & Auditor Engagement

We manage the audit process from start to finish.

  • Engage auditors early for planning and scoping discussions
  • Act as the primary liaison with auditors
  • Manage and track all audit requests
  • Provide timely responses and supporting documentation
  • Assist with audit adjustments and issue resolution
✓ Engage auditors early✓ Manage audit communication and requests
09

Governance, Reporting & Documentation Support

We strengthen governance and oversight structures.

  • Prepare and organize board minutes and governance documentation
  • Develop financial reporting packages for leadership and boards
  • Support audit committee and finance committee reporting
  • Ensure transparency and accountability in financial oversight
✓ Maintain governance documentation✓ Prepare reporting packages
10

Post-Audit Remediation & Continuous Improvement

We ensure long-term audit readiness and improvement.

  • Review audit findings and recommendations
  • Develop and implement corrective action plans
  • Strengthen controls and update processes
  • Provide ongoing monitoring and advisory support
✓ Remediate prior findings✓ Improve policies and controls

What This Means for Your Organization

With Stratum Financial Consultants, every audit readiness requirement is operationalized:

  • ✔Nothing is left as theory — everything is implemented
  • ✔All checklist items are actively managed and tracked
  • ✔Compliance, controls, and documentation are fully aligned
  • ✔Audit preparation becomes a continuous, structured process

Stratum's Differentiation

Unlike traditional firms that provide only guidance, Stratum delivers:

  • Hands-on execution of audit readiness tasks
  • Integrated compliance + financial + advisory approach
  • End-to-end audit lifecycle management
  • Proactive risk identification and mitigation