OLD APOSTOLIC CHURCH
(Province of Europe District 2)
AUDIT REPORT
March 22, 2016
Audit Key Steps
Planning
completed |
October
2015 |
Field
work completed |
January
2016 |
Internal
auditor’s appointments confirmation |
February
2016 |
Response
received |
March
2016 |
Final
report completed |
March
2016. |
|
|
|
|
Prepared by: Head - Internal
Audit
Acknowledgments
The
officers responsible for this audit comprised of:
·
Evangelist Herbst
as Head Internal Auditing,
·
Priest Le Roux as
Internal Auditor, assumed responsibility for the MENA countries,
·
Priest Slabbert as
Internal Auditor, assumed responsibility for England,
·
Underdeacon Sister
Hanekom as Internal Auditor, assumed responsibility for Belgium and Ireland,
·
Sister Prince as
Internal Auditor, assumed responsibility for Netherlands.
The
appointment of these Officers and Sisters has been confirmed by the Forum of
Apostles during the DFC meeting of the Old Apostolic Church – Province of
Europe District 2, conducted 19th December 2015.
Evangelist
Herbst conveys his thanks and appreciation to all officers in the various
countries, who contributed in finalizing the financial data, and particularly,
officers who provided insights and comments as part of this audit process.
Original
signed by
In
accordance with the Conference of Apostles Standing Committee on Finance, Audit
& Risk Management, the annual internal audit for the fiscal period 2015 was
performed for the Old Apostolic Church – Province of Europe District 2. Congregations of Belgium & Ireland,
England, Netherland and the United Arab Emirates were included in the audit.
The
community internal auditors and chairpersons manage all financial data on a
monthly basis as approved in the relevant applicable clauses of the Domestic
Rules of the Church:
1. Clause 3.4. - Financial Meetings,
2. Clause 6.1. – Congregational Financial Committee,
3. Clause 6.5. – Monthly congregational financial meetings,
4. Clause 6.6. – Books and Records,
5. Clause 6.7. – Cash on hand,
6. Clause 6.8. – Offer box and handling of Tithes,
7. Clause 6.9. - Expenditures.
The
purpose of the audit is part of a series of recurring events and aim to provide
a platform for officers to collaborate with their equivalent officers of
different countries to maintain uniformity. The objective is to identify and
maintain, through deliberations, practical steps to ensure the timeous,
accurate capturing and management of all financial data that contribute towards
maximizing the value of the Church at large as derived from the investments in
managing risks.
With
this in mind, the specific objectives of the audit were to evaluate the
adequacy and accuracy of the financial control framework of all the financial
records as well as the degree to which the regional responsible officers comply
with the applicable accounting regulations, policies and standards.
During
the initial planning of the audit, a high-level risk analysis was conducted in
order to identify, evaluate and prioritize the risks associated with the
management of the financial records. The analysis based upon an examination of
the accounting regulations, policies, manuals and standards that govern the
management of the financial records, on data analysis, and on the results of
preliminary interviews with officers considered key in the management of the
financial records. The criteria and methods used in the audit were based on the
identified risks.
The methodology used included data analysis, review of the
relevant documentation, and interviews with some of the congregational auditors
or chairpersons managing the financial records.
All the financial records recorded in the accounts receivable module in
the Pastel Financial system. A single user license acquired and installed on
the desktop of Elder & Sister Naude in Johannesburg region South Africa.
The scope of the audit was to ensure that
the congregational financial records managed in accordance with the Domestic
Rules – Clause 6 (Directives concerning the administration & management of
congregations) with specific emphasis to sub-clauses:
1.
Clause 6.6 – Books & Records,
2.
Clause 6.8 – The offer box and handlings
of tithes,
All financial data managed comprehensively
and captured accurately in the financial system. In doing so the financials are
managed fairly, efficiently and effectively to recover such receivables and
eliminate the risk of loss.
The audit objectives were to assess:
·
whether the framework of controls for the
management of accounts receivable is comprehensive & appropriate; and
·
the degree of the congregation’s
compliance with the applicable accounting regulations, policies and standards.
The audit dealt with internal accounts receivable created during the
2015 fiscal year.
In order to meet its objectives, this audit combined data analysis with
a review of relevant documentation and communication with various
congregational auditing officers.
A representative set of sample data was obtained to verify the accuracy
and effectiveness of data captured into the financial system for each period,
details are:
1.
Telephone & internet - January to December 2015,
2.
Travel & Accommodation - January to December 2015,
3.
Sealing service & related expenses - July
2015
4.
Rental of Hall - January to December 2015.
Belgium:
1. Travel and accommodation -
January 2015,
2. Rental of Hall - February 2015,
3. Registration Costs - May 2015.
4. Sealing service & related expenses -
May 2015,
5. Travel & accommodation -
August 2015,
6. Rental of Hall -
November 2015.
Ireland:
1. Rental of Hall - January 2015,
2. Travel & accommodation -
February 2015,
3. Telephone & internet - May 2015,
4. Sealing service - June 2015,
5. Registration -
December 2015.
Netherlands:
1. Rental of hall -
January to December 2015,
2. Travel & accommodation -
January to December 2015,
3. Sealing service & related expenses - July to August 2015,
4. Telephone & internet -
January to December 2015,
5. Stationary & Postage - July to August 2015.
MENA:
1. Rental of hall -
January to December 2015,
2. Registration costs -
May 2015,
3. Refreshments -
November 2015,
4. Sealing service - November 2015,
5. Travel & accommodation -
January to December 2015.
Interviews with officers of the various congregations were conducted in
order to identify and evaluate current practices, the controls that are in
place, and the difficulties that are being encountered.
This
audit has been conducted in accordance with the International Standards for
the Professional Practice of Internal Auditing.
In our
professional judgement, sufficient and appropriate audit procedures were
completed and evidence gathered to support the accuracy of the conclusions
reached and contained in this report. The conclusions are based on a comparison
of the situations, as they existed at the time of the audit with the
established criteria.
Due to
the fact that the third audit has been completed, greater emphasis will be
placed in future to comply with all the requirements stipulated in the Audit
& Risk charter as presented by the Conference of Apostles:
a.
Develop a risk management framework, including
risk management regulations and a risk matrix template, for identifying,
assessing, monitoring, managing and reporting significant risks in the
District;
b.
Develop a training programme for all Officers
in respect of the management of risk in the Church;
c.
Develop risk assessment, risk reporting and
risk mitigation mechanisms for approval by the Apostle Head Office
Administration and implementation by all in the District;
d.
Liaise with all relevant officers to ensure
that there is a common understanding of the key risks to the Church in the
District;
e.
Assess and contribute to the audit planning
processes relating to risk management with specific reference to: financial
reporting risks, including the risk of fraud; internal financial controls; IT
risks as they relate to financial reporting; and Management and control of
Church assets (funds, inventory and other)
f.
Review and recommend disclosures on matters of
risk in the annual financial statements;
g.
Provide regular feedback to the Apostle Head
Office Administration on the adequacy and effectiveness of risk management in
the Institution, including recommendations for improvement:
a.
Review and approve the Internal Audit Plan of the
District;
b.
Review significant audit findings and
recommendations by Internal Auditors as well as the Management responses
thereto;
c.
Review the effectiveness of the Internal Audit
function in the District;
d.
Provide regular feedback to the Apostle Head Office
Administration on the adequacy and effectiveness of internal audit practices in
the Church, including recommendations for improvement.
The main
purpose of this audit was to ensure that accounts receivable is being managed
fairly, efficiently and effectively. In particular, it verified the control
framework for the management of accounts receivable and the degree to which the
officers are in compliance with applicable accounting regulations, policies and
standards.
Audit
criteria and techniques were developed in order to gather sufficient
information on these subjects. The methodology used consisted primarily of
interviews, data analysis, and a review of the relevant documentation.
The main
observations show that, in general, the congregational accounts receivable are
managed in accordance with the principal policies, regulations and standards
that govern them.
PRIEST LE
ROUX PRIEST
SLABBERT
___________________________________ ___________________________________
UNDERDEACON
SISTER HANEKOM SISTER PRINCE
The
Old Apostolic Church (Europe)
European
District Two
Certificate for the Financial Year
2015
I, the
undersigned, certify that I performed the duties assigned to me during the
financial year that ended on 31 December 2015 in accordance with the
appropriate policy of the Apostolate, prescriptions and procedures contained in
the Constitution of the Church, appropriate regulations as well as policies,
directives, instructions and decisions of the Apostolate, Apostle: Head Office
Administration and District Finance Committee.
The
directives prescribed in the Policy for the composition of annual statements
for the Districts, were applied.
I certify
that all financial transactions submitted to me by the Treasurers of Belgium, Netherlands,
Britain, Ireland and the United Arab Emirates were
recorded and all records properly maintained and audited.
All the
financial statements (balance sheets and income statements) for the financial
year for all the countries in the District are attached.
Signed:
District Accountant
Elder H G Naude
Balance Sheet: Total Current Assets
·
Total Trust funds decreased by 4.19% to EUR 40
803.39, due to large net deficit of EUR 1 786.14.
Income and Expenditure Statement
·
Income
Tithe
income decreased by 11.16%; mainly for Officers
·
Expenditure
Registration Costs of EUR 3 527.15
was the major contributory factor to the large deficit of EUR1 786.14 for 2015.
Net Income is 161.93% down on 2014.