Q. How will your firm approach the audit of our credit union?
A. First, we are focused on developing and maintaining a close working relationship between the credit union staff and our firm. We will request various reports, schedules and analysis from your staff prior to the audit field work as well as throughout the audit.
We approach our work on the basis that your staff is familiar with your policies, procedures and internal operations. Our staff is familiar with credit union regulations and their requirements, various credit union data processing systems and general credit union operations. By combining our human resources into one joint working team, our audit results in a more positive and productive experience for the credit union.
Q. Assuming you can perform preliminary work before the audit date, how long will it take to complete the audit after the close of the fiscal year?
A. Time schedules and commitments can be designed to meet your needs. However, once management is prepared and we can begin and complete fieldwork, the following must occur:
- All significant accounting matters must be resolved.
- Responses to confirmations must be received in a timely manner.
- Report drafts will be distributed for approval by management and the Supervisory Committee.
- The audit file and reports will be subject to an independent review within our firm to ensure a quality and complete audit.
As an internal goal, once fieldwork is complete, draft reports are normally available within four weeks.
Q. What is your firm’s experience in providing auditing services to credit unions, including credit unions with assets up to $1 billion?
A. The following represents 100% of our clients (credit unions and their service-related organizations), ranked by asset size, that we served during the 12 month period.
Asset Size Number of Credit Unions
Less than $20 Million 40
$20 to $100 Million 31
Greater than $100 Million 15
In addition to providing audit services to credit unions, we have provided other management advisory services to credit unions that were not audit clients at that time. These credit unions range in assets greater than 2 billion.
Q. What are your firm’s current professional liability coverage limits?
A. Our current policy is underwritten by CNA, the premier insurance carrier in our industry. We have coverage up to $500,000 in effect through March 1, 2012. CNA has insured our firm since its origination in 1990.
Q. Is your firm is currently involved in any litigation with any client regarding audit circumstances?
A. Our firm has never been involved in any litigation.
Q. What commitments do you make to maintain managerial staff continuity when your firm is selected for an engagement?
A. All of our staff has been with this firm for over 10 years. This commitment will continue.
Q. What are the key milestones, by event and date, involved in the successful and timely completion of an audit?
A. Our audit planning would begin three months prior to the audit date. Actual audit fieldwork would begin within 60 days following the audit date. The preliminary draft of the audited financial statements would be presented within 30 days of the final fieldwork date.
Q. What is your firm’s procedure for allowing the NCUA examiners and/or the Supervisory Committee to review your work papers?
A. Our work papers are available upon request for review at our Olathe office location as well as electronically, if needed. We do require a statement of confidentiality to be signed by the reviewing party in order to have access to our work papers.
Q. What are your firm’s information technology audit capabilities and your related experience?
A. For the past 26 years we have grown with our credit union clients through all of their data processing upgrades. We are intimately familiar with the Symitar System and have developed specialized reports and audit procedures to maximize the efficiencies the system provides us in the audit process.
If necessary, we also have various relationships with specialized data processing auditors to assist us where needed.
Q. What are your firm’s standards for responsiveness to client inquires and your approach/philosophy for setting reasonable deliverables and honoring commitments?
A. Our goal is to respond immediately to your inquiries. Normally, this is within the same business day. Our responsibility to you is in the form of timely, useful information delivered in a manner that is valuable to your organization.
Q. What is your firm’s receptiveness to an annual evaluation by the Supervisory Committee with supplemental comments provided by senior management and staff?
A. We welcome an evaluation of our work. In fact, we provide a number of checklists and aids for use in firm evaluation. We believe an open line of communication with the Supervisory Committee is a key aspect of the audit process.
Q. What is your firm’s involvement within the credit union community?
A. Our firm’s principal, Jerry Tenbrink, frequently is invited to speak both locally and nationally on numerous credit union issues. He is widely regarded as a popular presenter who can communicate sometimes complex issues in a highly understandable way. He is helpful as well in providing useful material for attendees to take back to their credit unions to communicate to other staff and officials.
Q. What are your firm’s process and capacity to stay abreast of regulatory and FASB issues affecting credit unions?
A. Staying abreast of regulatory and FASB issues affecting credit unions is a very important part of our practice. Our staff members study and keep updated on regulatory accounting changes and timely political issues affecting the credit union industry. This specialized education is in addition to the annual professional education required of Certified Public Accountants.
In addition, we maintain a close working relationship with CUNA and the Missouri and Kansas Credit Union Leagues. We also communicate regularly with federal regulatory agencies who review our work. Because of these relationships, these entities have referred many clients to us over the years.
Within our staff, you will find Certified Public Accountants who are active members of the American Institute of Certified Public Accountants.
Q. What is your firm’s process for coordinating with and helping clients implement new FASB and other national and international accounting guidance?
A. We will keep your management team abreast of all important accounting and regulatory changes that impact credit unions. This is accomplished through direct communication via phone, e-mails and written communications.
Q. When was your firm’s most recent peer review? Is a copy of the findings available?
A. Our firm’s last peer review was performed by Brown, Smith and Wallace as of 2008. A copy of their report is available.
Q. What are your firm’s qualifications and/or experience for evaluating internal controls for data processing systems in the credit union environment?
A. Because of our extensive experience with credit union data processing systems, we have been able to evaluate the levels of controls available and can immediately assess how they are used in your credit union. This allows potential weaknesses to be immediately identified and corrected.
This experience benefits your credit union because it requires less time to develop an understanding of how the system works which allows us to concentrate on other issues.
Q. What is the method used for member account confirmations, and what are the costs associated with that method?
A. Because of our understanding of various data processing systems, we have developed various approaches to the confirmation program. We have found that 100% negative confirmations may be less expensive and still provide acceptable audit coverage. However, if you specifically request that the verification be done on a statistical sampling basis, this approach is acceptable and will not affect our overall audit objective.
In addition to the negative confirmation of member accounts, we will also perform a positive confirmation of their accounts. This will be on a sample basis (usually accounts with large balances), and gives us additional assurance that account balances are correct.
All costs to perform member account confirmations are included in the audit fee quoted.