Tips for Requests for Proposal (RFPs)

Posted on Wednesday, February 20, 2019

Is your organization thinking about changing auditors? Before you do, here are some things to consider before starting the process, from someone who is both an auditor and a nonprofit board member.

It’s best to limit the number of firms that you invite to submit proposals to those that have been recommended to you. Ask other organizations similar to yours who they work with, specifically ask them about their experience with the CPA firm and who the individual is that they work with. Other good sources of recommendations are lawyers and bankers who work with CPAs. Also make sure you ask your board members for input. They likely serve on other boards or have experience with CPA firms in their day jobs.

Do your research. Visit the websites of the firms that have been referred. Do they mention working with nonprofit organizations and having knowledge specific to nonprofit organizations? Are the firm’s auditors involved with other nonprofit organizations through board or committee service? Auditors that also serve as board members have a unique knowledge of nonprofits. They can understand the audit through both a board perspective and auditor’s perspective.

In order to make sure that you select an audit firm with the skills and experience your organization needs, you should ask for basic information to be included in each firm’s proposal. See our prior blog, Nonprofit Audit RFPs, for information to include. Requesting the same information from each firm will allow you to more easily compare them.

Expect to receive questions. In order to provide a reasonable quote for their services, the firms will likely inquire about the following.

Obtaining a copy of most recent audit.
Obtaining a copy of most recent 990.
Obtaining current (year to be audited) year to date internal financials and trial balance.
Any significant changes occurring in the current year (year to be audited).
Reason for the audit – is it required by a funder, government entity or board?
Timing of audit.
Reason for changing auditors.
What needs are not being met by your current auditor.
Deadline for submitting the proposal.

Finally, make sure you follow up with all of the firms that you requested RFPs from. Let them know why or why not they were selected.

Posted by: Carrie Minnich, CPA

Posted in Mission Minded Nonprofits

Disclaimer: The information contained in Dulin, Ward & DeWald’s blog is provided for general educational purposes only and should not be construed as financial or legal advice on any subject matter. Before taking any action based on this information, we strongly encourage you to consult competent legal, accounting or other professional advice about your specific situation. Questions on blog posts may be submitted to your DWD representative.