The PBC Audit Checklist—and Why You Need One

Will you be ready for your next audit? If your answer is “no” or “I don’t know,” you need a provided by client (PBC) checklist.

What is a PBC?

A PBC checklist is a list of all documentation, spreadsheets, and schedules that your auditing firm expects your organization to provide as part of your annual audit. Your auditors should provide the checklist at least a few months prior to the start of the annual audit. If they don’t, ask for one!  Although the lists typically don’t change drastically from year to year, it’s always a good idea to get one each year to avoid surprises.  If there is a change in audit standards, or even audit firms or partners, this could result in PBC modifications.  

Common items found on PBC lists include a Trial Balance, financial statements, supporting schedules and/or reconciliations for all  Statement of Financial Position accounts, net asset roll forward,  941 reconciliation, CRM reconciliation, General Ledger detail, Cash Disbursements Journal, Cash Receipts Journal and a Statement of Functional Expenses.  You’ll also likely need to provide other documentation  such as your by-laws, organization charts, copies of grants, copies of lease agreements and other operational contracts, board meeting minutes, fixed asset disposals and loan documentation  

In general, make sure that your PBC checklist:

  • Makes sense—it won’t do you any good if you don’t understand what the auditors want, so don’t hesitate to ask questions
  • Is updated annually to account for changes to your organization and to accounting rules and regulations

How do PBC lists help?

It’s pretty simple: The faster the audit, the less it costs (at least ideally). The PBC checklist helps you organize and manage your pre-audit workload, so your financial team can ensure they have addressed all requests before the audit begins. Then, during the audit, your team will be free to respond faster to any requests as they arise. 

Need support for your next audit? 

If your accounting team is swamped with everyday responsibilities and you find yourself falling behind on audit preparations, it might be wise to bring in an experienced expert. Chazin & Company can help you develop a year-round process that ensures a smooth, uneventful audit—while also allowing your internal team to focus on more mission-critical work.