Auditing your club's records
It's almost tax season again.   Just about time to close out another year and move on to next year.  
But wait!  Before you throw all those 1099's, bank & brokerage statements, and a copy of the club's tax return into a folder and forget about them, you club should perform an internal audit.   A committee of members of your club, other than the financial partner, should review and verify the accuracy of the club accounts for the past year.  Some clubs do this as part of a regularly scheduled meeting, getting everyone involved in the process.  This participation helps all members to become more aware of the functions performed by the financial partner, more familiar with the accounting software and methodologies employed, and more familiar with the tax return that the club is required to file.   Remember, even though your club may have a designated financial partner or treasurer, every member of a partnership is equally responsible to ensure that the club's financial house is in order.
In preparation for the audit and review by the audit committee, the financial partner should collect all records applicable to the period being audited.  Those records would including the following ....
All Form 1099's received by the club 
All Bank Account Statements       
All Brokerage Statements               
All Dividend Reinvestment Plan (DRIP) Statements
All Cancelled Checks
Stock Certificates for those shares physically held by the club
If already completed, the club's Tax Return, both Federal and State, if applicable, including all associated forms and documentation.
Any and all other documentation pertaining to the club's financial records during the period being audited.
Having received all of the collected paperwork the audit committee is ready to begin.   You'll be reconciling and verifying these records against the club books.   Since your bivio books are online, you have two choices.  You can either verify these documents while online or you can print your reports from bivio and use those as the source of your verification.   I prefer the later.  That way, once completed,  you'll have some written documentation of the audit that can be included in your paper archives.   In either case, which bivio reports do you need to use?
A Transaction History for the entire period.
An Investment Detail for each investment held during the period
A Member Detail for each person who was a member during the period
An Account Detail for each cash account that was active during the period
Auditing this pile of paper may appear to be a daunting task, but it won't be if the club records are in order.  Simply go through, transaction by transaction and verify each against that which is entered in bivio.    If the club records are in error, it's much better to annotate the discrepancy and have the financial partner fix those errors now rather than waiting.    Ignoring errors, inconsistencies, and omissions will do nothing but create much larger problems later.   So, let's get started.....we'll be done before you know it.  Let's......
Reconcile the 1099's against the related entries in the club's books.   For example, if your club owns XYZ and it paid you 4 dividends during the year of $2.50, $2.55, $2.60, & $2.62,  your books should reflect these entries and the 1099-DIV received from XYZ should reflect $10.27   Note: Companies are not required to issue 1099's in some cases when the amount to be reported does not exceed $10.
Have each member verify the accuracy of their Member Detail
Verify the Bank Statements, transaction for transaction, against the entries in the club books.
Verify the Brokerage Statements, transaction for transaction, against the entries in the club books.
Verify all beginning and ending balances on the bank statements, brokerage statements, DRIP Statements, etc. against those in the club books.
Verify that the stock certificates that are to be in possession of the club are indeed in the clubs possession
Completing an audit of the clubs records is very important.  Each member should feel confident in the accuracy of the club's books and that all tax filings have been done properly.
Jerry Dressel
St.Louis, Missouri