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In today’s business environment, conditions are ever-changing. From one day to the next, new variables arise, and it is not always possible for companies to take time to stop and examine the impact of changes on operations. However, for an organization to survive and succeed, the policies and procedures need to be adequate for the organization’s current size while allowing room for sustainable growth and adaptability to changes. An operational assessment from our firm may be a path forward to help organizations identify areas needing attention.

Does an Organization Need an Assessment?

An operational assessment can be a useful tool for an organization of any size at any point in its life cycle. Identifying problems before they become apparent is highly beneficial to an organization. How do you know if this is something that is right for your organization? A few examples of scenarios in which we have seen the need for an operational assessment include:

  1. A new organization with new staff:
    1. Management wants to evaluate that proper protocols and sound internal controls are established, implemented, and followed.
  2. A mature organization with low staff turnover:
    1. Management wants to examine processes to assess if there are more updated and efficient means to record transactions, prepare supporting documentation, and maintain adequate internal controls. Job descriptions may need to be re-evaluated to enhance cross-performance of tasks or proper segregation of duties.
  3. A mature organization with high staff turnover:
    1. Management wants to evaluate that existing policies and procedures cover significant financial transaction cycles for the organization, and institutional knowledge is not lost during staff turnover.
  4. An organization that has not reviewed its policies and procedures in more than three years:
    1. Management wants to assess overall policies as a refresher to help the organization run smoothly. Current procedures are accurately reflected in the policy and procedure (P&P) write-ups. Changes due to remote/hybrid/cloud-based functionality should be documented.
    2.  Restructuring of a department’s reporting lines or an individual’s job duties also require updates to a P&P manual.
    3. In addition, an organization will want to evaluate the existence and completeness of ancillary policies (such as whistleblower, conflict of interest, and fraud prevention policy) to support good governance.
  5. Major changes in the organization:
    1. Changes in funding streams, rapid organizational growth, recurring management letter comments from external accountants during the organization’s annual audit, and anticipated expansion that will necessitate finance department scalability are key indicators for an operational assessment.

What Is an Operational Assessment?

A financial operational assessment can help you obtain an understanding of the current processes and duties assigned within the financial reporting process, identify potential opportunities to streamline activities, and improve utilization of resources. One of our professionals can assist your organization by documenting observations from interviews and reviews of requested documentation, identifying enhancement opportunities, and making recommendations for necessary structural changes or suggested projects that can remediate identified gaps.

The assessment can include an evaluation of the following areas (these will vary based on your type of organization and revenue streams):

  • General organization
  • Board governance 
  • Financial reporting and monitoring
  • Budgeting and financial planning
  • Asset management
  • Cash receipts and contributions, including grant management
  • Endowments and restricted funds
  • Cash disbursements
  • Payroll
  • Tax compliance
  • Information technology security

Benefits for Your Organization

This assessment can provide recommendations aimed at helping you reduce costs, improve operations, strengthen internal controls, and better track financial performance. The assessment can provide the organization with suggestions and best practices based on your unique circumstances paired with our extensive experience working with similar organizations. Recommendations for modifications to existing internal controls, staffing structure, and policies or even creating new ones can help improve the organization’s reporting accuracy, timeliness, and transparency.

From that point, the organization can work to fill in these gaps in processes and controls. Since most organizations will not have the resources to remedy identified issues, this assessment report can act as a road map or support for executive management to bring in additional resources to help remedy issues.

At the operational assessment’s conclusion, you can continue to rely on our expertise to help resolve any findings as the organization moves forward. Let us help your organization continue to thrive and serve its mission!

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