PRODUCTS

This booklet presents accounting and tax information that may or may not be right for your specific Fraternal Unit. In view of

the complex, individual, and specific nature of tax situations, this booklet is not intended to replace professional accounting or

legal advice. Moose International expressly disclaims any responsibility for any loss or risk incurred as a consequence of the

application of the contents of this booklet. Moose International advises each Fraternal Unit to seek the advice of their own

legal or tax professional.

The material contained herein is the property of Moose International, Inc. and is confidential. Moose International owns all

copyright rights to this material, and it may not be reprinted or reproduced in any manner without the written permission of

Moose International, Inc.

TABLE OF CONTENTS:

Introduction: ........................................................................................................................................... 1

References: ............................................................................................................................ 1

Special Note: .................................................................................................................................. 1

Fraternal Unit Financial Review/Audit Committee Suggested Guidelines ............................................... 2

Committee Members: ............................................................................................................. 2

Committee’s Activities: ........................................................................................................... 2

The Financial Review/Audit Program: .................................................................................... 3

Internal Controls: .................................................................................................................... 3

Verification of Assets: ............................................................................................................. 4

Certification that Returns and Reports are filed:..................................................................... 4

Available Reports: .................................................................................................................. 5

Final Report: .......................................................................................................................... 5

Appendix A – Financial Review/Audit Committee Checklist ................................................................... 1

Appendix A – Financial Review/Audit Committee Checklist ................................................................... 2

Financial Review/Audit Committee Guidelines – August 2019 Page 1

INTRODUCTION:

This information guide is intended to assist the Financial Review/Audit Committee to perform

a limited review of its organization’s financial strength and policies. This guide should help

the Board control financial activities until an additional financial review/audit might be

deemed necessary. It emphasizes the importance of internal controls in safeguarding the

Fraternal Unit’s assets.

Definitions:

Any time reference is made to a Fraternal Unit within this or any other materials it refers to all

three fraternal units together - Lodges, Chapters and Moose Legions.

References:

 The General Laws

 Officers’ and Committeemen’s Handbook

 WOTM Handbook

 WOTM Officer’s Handbook

 WOTM Recorder’s Handbook

 Moose Legion Code of Rules

Special Note:

Lodges and Chapters may now do all of their banking on-line (electronically) providing they

have received authorization, in writing or electronically, from the General Governor or Grand

Chancellor’s office respectively. If your Fraternal Unit decides to do its banking on-line you

should know there are some banks that do not send out monthly statements to those

customers. The statements can be reviewed on-line, (the Administrator, Recorder or Moose

Legion Secretary should print out the statement for the Fraternal Unit’s records). So, if the

Financial Review/Audit Committee is reviewing the Fraternal Unit’s books and records and

needs to see the bank statements a copy will be in the file. No password should be given to

anybody other than the Administrator, Recorder or Moose Legion Secretary, because they

are responsible for all of the Fraternal Unit’s books and records.

Page 2 Financial Review/Audit Committee Guidelines – August 2019

FRATERNAL UNIT FINANCIAL REVIEW/AUDIT COMMITTEE SUGGESTED GUIDELINES

Committee Members:

Lodge: At the first regular meeting after being installed, the Governor shall appoint two (2)

members of the Lodge (one of whom shall be chairman) to serve with the Prelate on a

Financial Review/Audit Committee. The three (3) members of the committee shall serve for

one (1) year. (See Appendix A for suggested responsibilities.)

Chapter: Each year the Senior Regent shall appoint one person to serve on the Progressive

Audit Committee of three (3) members, a Chairman and two (2) Committee members, to

compile the monthly financial reports for the each month. Any co-worker in good standing

shall be eligible to serve on the Audit Committee except an Elected or Appointed Officer,

Chairman of a Chapter Development, Standing or Special Committee, Ritual Director or

Escort, except where dispensations have been requested and granted to very small

Chapters.

Moose Legion: At the first regular meeting after being installed, the President shall appoint

two (2) good standing members, one of whom shall be chairman, to serve on the Audit

Committee. The Chaplain shall be the third member of the committee. No other member of

the Board of Directors shall be a member of this Committee.

The President shall demand and receive from the Board of Directors and each Committee

Chairman of the Moose Legion, all stocks, bonds, notes, accounts and records of the Moose

Legion required by the Audit Committee to make a full and correct report.

Committee’s Activities:

The Committee members should be concerned with the following:

 Familiarizing themselves with the reporting process and internal controls.

 *The adequacy of internal controls (the system used to create and verify various records

required by the House Committee, Moose International, and the various state and local

administrations.)

 *The accuracy of records and reports to the House Committee, Governmental offices and

Moose International.

 The proper authorization of activities and expenditures.

 The verification of the physical existence of assets (including inventories excluding House

Committee).

 A review of tax-exempt status and identification of any activities that could endanger it.

 Ensure that payroll taxes, licenses, sales taxes, and any other taxes and the Fraternal

Unit’s reports are properly filed as required by respective governing authorities.

 Reviewing Moose programs and understanding their financial relationships.

 Audit required financial reports and statements, and attest to their accuracy.

 Attest and assure that financial reports are read at Fraternal Unit’s meetings.

 Conduct special financial reviews/audits when requested by the Board of Officers.

 *Conduct monthly financial review of House Committee records.

 Verify Membership information.

*Indicates House Committee activity only.

Financial Review/Audit Committee Guidelines – August 2019 Page 3

The Financial Review/Audit Committee must establish in their own minds that the controls

required by the organization, the Fraternal Units, House Committee, and governmental

bodies are being followed. It must perform substantive testing to verify that transactions were

properly recorded. Testing must include, but is not limited to: bank statement reconciliation,

review of minutes, review of receipts, and comparisons of current and previous financial

statements. The results of these and other testing will provide evidence to the completeness

of the financial accounts and statements.

The Financial Review/Audit Committee should review the items found deficient in the

previous financial review/audit to assure that the indicated items were addressed and no

longer continue to be deficient.

The Financial Review/Audit Program:

The Financial Review/Audit Committee should develop a written plan for each account,

function, or class of financial transactions it has selected for the examination. The plan

should indicate the relationship to the financial statement assertions and financial

review/audit objective. An example would be to verify the purchases of small games of

chance against the control sheet. Games in must equal games out.

The following are examples of how financial review/audit objectives could be developed:

Financial Statement Assertion

Financial Review/Audit Objective

Existence of Assets

 Verify inventories included on the balance sheet

physically exist.

Accuracy of the Fraternal Unit Assets

Verify Expenditures

 Verify inventory quantities include all products,

materials and supplies on hand.

 Inventory listings are accurately compiled in the

inventory accounts.

Savings and Investments

 Verify that the savings accounts match deposits

and withdrawals.

 Proper authorizations for withdrawals are

documented in the meeting minutes and a

dispensation received from the General

Governor’s office for Lodges. This is not a

requirement for the Women of the Moose.

 All transfers from one account to another are

complete and accurate.

Verification of Membership

 Verify all applications received since the last

report have been entered and transmitted to

Moose International.

Internal Controls:

The Financial Review/Audit Committee must be attentive to the adequacy or inadequacy of

internal controls. Lack of good internal controls can make the financial review/audit task very

difficult, if not impossible. When reviewing internal controls, the committee should use

common sense as its guide. There are some very good reasons for internal controls

including:

 Preventing loss by theft.

 Safeguarding the assets of the Fraternal Unit.

 Assuring that transactions are authorized and properly recorded.

 Preventing mistakes by an employee.

Page 4 Financial Review/Audit Committee Guidelines – August 2019

Additionally, the internal controls should be reviewed for compliance with the laws of each

Fraternal Unit, the General Laws, the WOTM Handbook and the Moose Legion Code of

Rules as well as any regulatory agencies. Test these controls by assessing the activities

performed by the employees and specific transactions for compliance.

Verification of Assets:

The Financial Review/Audit Committee shall make its primary objective to verify bank

balances, count of securities, savings account balances, as well as fixed and saleable

inventories. The committee shall examine statements and compare them to documented

records agreed to by the Boards. There should be evidence that checking accounts are

reconciled each month.

Certification that Returns and Reports are filed:

Even though the Fraternal Unit is classified as a Not-for-Profit organization (501(C)-(8)), it is

still required to file tax returns, complete various regulatory forms and/or reports. Failure to

comply could result in fines, loss of its Not-for-Profit status, or loss of its charter. The

Financial Review/Audit Committee shall make a list of these documents during the planning

phase and verify that the Fraternal Unit complies. The list might include the following:

 Payroll Taxes

 Sales Tax and licenses

 Form 990 (including Schedule B)

 Various Fraternal Reports

For further information on Taxes refer to the handout “Understanding Tax: Exemptions,

Forms and Filing Requirements for Fraternal Units” and the Women of the Moose Recorder’s

Handbook.

Financial Review/Audit Committee Guidelines – August 2019 Page 5

Available Reports:

At the monthly financial review/audit it would be helpful if the Chairman of the Financial

Review/Audit Committee has computer experience and has read the LCL.net and Quick

Books Pro Tutorials, which should be maintained in the Administrator’s, Recorder’s or Moose

Legion Secretary’s office. The following reports should be printed from Quick Books or

LCL.net and available for the Financial Review/Audit Committee.

The following reports are found in Quick Books

 A Chart of Accounts

 Reports

 Company & Financial

 Profit & Loss Standard

 Profit & Loss Detail

 Income by Customer Detail

 Expenses by Vendor Detail

 Balance Sheet Detail

 Banking

 Missing Checks

 Vendors & Payables

 Unpaid Bills Detail

The following reports are found in LCL.net under the Go To menu selection:

 Monthly Reports

 Member Status Reports

 Arrears Report

 Applicants Reports

Final Report:

Upon conclusion of the financial review/audit, the committee chairman must prepare a written

report and present it to the Board of Officers. The report must detail the findings of the

financial review/audit and make recommendations to the Board and the Fraternal Unit as to

what is needed to comply.

Audit Committee Quick List Appendix B, Page 1

APPENDIX A – FINANCIAL REVIEW/AUDIT COMMITTEE CHECKLIST

Monthly Responsibilities



Verify all investments, CD’s, and savings accounts are safe and secure

Ensure cash received by the Administrator and/or Administrative Assistant from all sources are

receipted and deposited in gross weekly.

Verify deposits from Moose International (member dues) and credit card deposits, if applicable,

are recorded in QuickBooks

Verify credit cards are used for purchases ONLY – NO cash advances

Verify deposits from all income sources are on bank statements and entered in QuickBooks:

This verification includes totals from the weekly House Committee Envelope, raffles, vending,

gaming, hall rentals, membership dues, etc.

Verify the current Administrator, Governor, and Treasurer are the only officers with proper

check signature cards on file with the bank for all checking accounts

Verify all checks written have two (2) signatures and canceled checks match QuickBooks

entries, checkbook stubs and bills

Verify ACH payments match bills, and recorded in QuickBooks/checkbook

Review and investigate checks written for cash (see Section 43.4 of General Laws pertaining

to cash and cash expenditures). Verify a “Cash Purchases Journal” is kept and filed for

information Note: This does not apply to Women of the Moose except for Bingo

Verify all licenses and permits are current

Verify all insurances, payroll, real estates, and sales taxes are remitted on time and are current

Verify there are three (3) consecutive years of 990 Federal Tax returns and the present fiscal

year 990 is current

Verify monthly QuickBooks reconciliation and reconciliation balance match monthly bank

statements

Review and verify the monthly financial statement is successfully transmitted to Moose

International

Board of Officers and Membership meeting minutes are accurate (following agendas),

complete, approved and signed by the Administrator, Governor, or presiding officer

Ensure all new applicants are entered in the body of minutes with sponsor and voted on for

acceptance

Verify all new applicants are transmitted and enrolled

Ensure Lodge Guest Book is being used properly.

Ensure there is an Incident Log Book behind the bar

Review Committee to file a written report of their review to the Board of Officers and the

membership monthly. Report to contains suggestions when applicable

A copy of this checklist and Financial Review Report(s) to be filed in a safe location and kept

for seven (7) years

Any questions raised by the Audit Committee shall be submitted with the report to Moose

International. (For further information see Sec. 43.5 of the General Laws

Submit in writing to Moose International any concerns with the Financial Report.

Page 2 Financial Review/Audit Committee Guidelines – August 2019

APPENDIX A – FINANCIAL REVIEW/AUDIT COMMITTEE CHECKLIST

Additional Requirements

Date



Verify physical inventory of all lodge assets. (yearly)

Note: If any of the above items are not performed properly, they are to be brought to the

attention of the Board of Officers for proper action and corrections.