Accounts maintenance is a crucial part of operations in any organization. If you are responsible for managing operations of an educational institute, you must be aware of how important it is to maintain accounts and carry out audits frequently.
In order to carry out the operational functions, you need to hand certain things over to the professionals. In this way, you are able to carry out your job role, which is: to manage, without having to divert your attention to the nitty-gritty of the specialist tasks. If you haven’t already handed the maintenance of the account to a professional, now is the best time to make that decision.
This article will throw light on some avenues of accounting and Auditing in educational institutions that you must know of.
Accounting and Auditing in Educational institutions: FAQs
There are some questions answered in this article, which will help you understand the need for a professional service for accounting and Auditing in your private school, college, university, or research organization.
Please have a look:
1. What are the Main Sources of collecting money
Inflow and outflow of money is the starting point of financial operations. Sources of inflow in an educational institution are as follows:
- Student Admission fees, monthly or semester tuition fees, examination fees, fines, etc.
- Security fees from students.
- Donations from the public, and NGOs
- Grants from Government for building and maintenance, awards and prizes, scholarship funding, etc.
2. How many types of Expenses or Payments are there?
Every organization has different kinds of operations. Hence cash flows incorporating inflow and outflow of money are also peculiar to every industry and sector within an industry. For an educational institution, common types of expenses are as follows:
- Salary, provident fund, and allowances contribution for teaching faculty and non-teaching staff.
- Examination expenditure
- Stationery & printing expenses
- Distribution of scholarships and stipends
- Purchase and repair of furniture & fixture
- Expenses on sports and games
- Festival and function expenses
- Library books
- Newspaper and magazines
- Medical examination and pharmacy expense
- Audit fees and audit expenses
- Electricity connection expenses
- Telephone or telecom services expenses
- Laboratory care & maintenance
- Laboratory equipment procurement, care, and upgrades.
- Building Repair & maintenance
3. What are the considerations for the preliminary Audit?
A professional auditor will consider a number of important points before carrying out a preliminary audit. These considerations are as follows:
- Whether the auditor has obtained a list of books, documents, ledger, and other records as the education institution has maintained.
- Observe and examine the audit report for last year
- Check for the important provisions recorded regarding accounts and Audits from the Trust Deed and Charter of Regulations.
- Examine the Meeting Minutes of the Governing Body for important decisions regarding the sale or purchase of fixed assets, investments, or delegation of finance power.
- In the case of high school, colleges or universities, the Grants Commission provides Grants to them subject to certain circumstances and conditions.
4. What is the role of audits in the Internal Control System?
Efficient Auditing and account management is very beneficial for the internal control of any organization. In order to maintain it further, the professional auditor will need to develop an understanding of the policies and practices of the organization. For this reason, you can trust only the top audit firms offering services in Dubai for your educational institution.
From division and rotation of staff duties to asset security and safeguarding processes, the auditor will require information on all the matters of internal control. When the auditor is professionally sound, there will be no fears of the information breach, and you can expect an improvement in corporate governance as well.
The auditor will check whether the internal control system is working efficiently. If not, he will identify the loopholes in the policy-related documents and give you recommendations regarding important matters of internal control.
5. How to conduct an audit of Assets and Liabilities
To conduct audits of assets and liabilities, the officer in charge will make some important considerations. The first and foremost consideration is the verification of details in the asset register. They have to check if the details of the assets are in line with the country’s local laws regarding assets of educational institutions.
They also need to verify the depreciation of the value of assets as per the requirements of the grants would suggest. If the organization is running under a trust, the relevant considerations and meeting the requirements is also an essential part of the auditor’s job.
Conduct Regular audits for your educational institution
Well, if you aren’t in touch with a professional auditing firm as yet and are relying on a team member to handle accounts and bookkeeping, the numbers can get you in trouble. Hence make sure you understand your institution’s accounting and auditing needs and hire a professional accordingly.