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Form 990- Preparation

Francis AO's Profile

In the process of lowering our overhead cost l am considering preparing Form 990 in house rather than allowing the auditors to handle it for an average of $5,000.00. Does any one have a better ideas on how to extract audited financial information for use on Form 990? Thanks Francis


Topic Expert
Wayne Spivak
Title: President & CFO
LinkedIn Profile
(President & CFO, |

Francis -

Not sure what the question actually is.... I'm sure the 990 has to be filed before your audit would get completed. While the 990 is annoying to file, $5K seems to be an exorbitant rate.


Francis AO
Title: VP
Company: Floyds Consulting
(VP, Floyds Consulting) |

We file Form 990 after the completion of the audit. And the question is how to use the audited financial information to complete the Form 990. Thanks for your response

Topic Expert
Wayne Spivak
Title: President & CFO
LinkedIn Profile
(President & CFO, |

I'm sorry Francis, I don't see the issue.

Depending on how you keep your books; the audit and how it was conducted, why aren't you pulling the financial details from your "now audited" books?

Specifically, if your books "mimic" the information required to properly complete the 990, it would be a "slam dunk". If on the other-hand, your books don't come close and it requires a re-working of all your numbers, then besides the extra work, the financials have been audited, so the numbers in total "should be" correct.

Hopefully this helps, otherwise I'm lost...


Joan Burns
Title: Tax Accountant
Company: Covenant Health
(Tax Accountant, Covenant Health) |

I complete 990's all year for hospitals. We use the information from the trial balance to classify the data reported on the 990. However I have noticed that one non-profit for which I volunteered for set up their chart of accounts in a manner they thought would help reporting by their various programs, but made the roll up for analysis and tax reporting very confusing. If you are having trouble pulling the data from the trial balance it may be that you need to re-organize or re-think your account structure.

Topic Expert
Barrett Peterson
Title: Senior Manager, Actg Stnds & Analysis
Company: TTX
(Senior Manager, Actg Stnds & Analysis, TTX) |

How are your records maintained? Quickbooks, for instance has a non-profit version which produces many 990 reports depending on organizational complexity. A "categorized" trial balance may help depending on its organization. If your will devote more than 100 hours of organizational resources to the effort, $5k may not be too bad an alternative.

Val Kennings
Title: CFO
Company: Nonprofit
(CFO, Nonprofit) |

My parent organization is encouraging our locals to prepare and file the 990 themselves. However, this is an extremely confusing document to put together. In no way are you able to exactly code your TB to "pull" to the return, and there are quite a few additional schedules to complete. It takes me more work with my audit firm to get the 990 completed than the audit. I would encourage you to take this work out to bid. $5,000 Does seem a bit high.

George Ferenzi
Title: Owner
Company: George W Ferenzi CPA
(Owner, George W Ferenzi CPA) |

Yes I agree 100% they do not realize the big penalties for filing wrong or incomplete returns.

David Ziska
Title: CEO
Company: Council Business Solutions
(CEO, Council Business Solutions) |

The starting point is the trial balance (TB). Therefore, your TB needs to reflect any adjustments that auditors made in preparing the audit report. The auditors have schedules that cross-walk the base TB numbers to the audit report numbers. They should make these schedules available upon your request.

The 990 requires a "Statement of Revenue", "Statement of Functional Expenses", "Balance Sheet", "Reconciliation of Net Assets", and a schedule to reconcile the 990 to your audited financials. For the Statement of Revenue and Balance, I put the TB in a worksheet, create a column for each number required on these two forms, and start copying TB numbers into the appropriate column. Sum the columns, and that work is done.

The Statement of Funcitonal Expenses requires every expense transaction to be allocated to Program, Fundraising, and Admin. My accounting system Abila/MIP allows me to define whatever fields I desire, to code transactions, over and above the basic G/L account number. So, I have a segment for functional expense area that is used to code all expense transactions, as we enter transactions into the accounting system. This allows me to run a report that prints-out the equivalent of the required 990 functional expense schedule. To me, this is the hard part, in absence of the described mechanism.

The reconciliation schedules should just drop-out, as long as you and the auditors started from the same point.

Not a trivial task, but doable. The $5,000 seems high to me, but it's hard to guage without an understanding of the complexity of the organization. Be sure to have your marketing person do the wording for the "Program Accomplishments" section, as that is an opportunity to broadcast your greatness.

James R Hendrickson
Title: Certified Public Accountant
Company: Kollath
(Certified Public Accountant , Kollath ) |


Unless your auditor relationship has completely broken down, they s/b willing to share their work papers with you which will provide a blue-print for moving from your financials to the 990. The 990 may look overwhelming, but it's not. Just a lot of detail and some allocations to deal with. You've probably already been providing your auditors with the information needed to do the allocations. And someone at your auditors s/b willing to answer questions for you. If they're charging $5000 for the 990, they want to keep your audit business.

George Ferenzi
Title: Owner
Company: George W Ferenzi CPA
(Owner, George W Ferenzi CPA) |

Send me a copy of your pervious 990 and I will give you a quote. I am not sure if your trained in such preparation but if you file an incomplete return or miss even one page of the required filing you can be hit with a big penalty. According to the IRS an incomplete filing is considered not filed and they hit you with a big non filing penalty. Its not worth the risk.

Jaime Campbell
Title: Chief Financial Officer
Company: Tier One Services, LLC
(Chief Financial Officer, Tier One Services, LLC) |

Also consider that your trial balance accounts do not have to match the 990 accounts. Your company uses QuickBooks, and there's you have the option of signing each trial balance account to a 990 account once you adjust your comment settings to tell QuickBooks that the company files a 990.

To assign a 990 line item to each account in the COA, open the COA and edit the first account in the list. You'll see the field right in there.

Once you have completed this, run special financial statements. Reports>Accountant & Taxes> Income Tax Summary, I think it's called.


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