World Church: Audit Process Strengthened by Council's Action
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Financial audits of the Seventh-day Adventist Church world headquarters will now be more independent, following a vote to have the Church's General Conference executive committee appoint a separate financial audit review committee that will not have church administrators as members. |
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Financial audits of the Seventh-day Adventist Church world headquarters will now be more independent, following a vote to have the Church's General Conference executive committee appoint a separate financial audit review committee that will not have church administrators as members, though they may be invited to some sessions. In addition, this restructured audit review committee will be able to discuss internal control issues without administrators present.
These changes were among those voted Monday, Oct. 13 by the annual business meeting of the Adventist Church's world leadership. Lowell C. Cooper, a general vice president of the world church, said the changes were proposed to strengthen the "structural independence" of financial audit reviews in the wake of financial scandals in secular businesses. The church, in turn, wants to demonstrate its valuing of "transparency, integrity and accountability in its organizational structure," he said.
The new procedures will involve having the Audit Review Committee recommend a public accounting firm to provide the annual audit of the world church headquarters operation, rather than it being processed by the world church headquarters' auditing service. Under new terms of reference also voted today, the financial audit review committee will now recommend an outside auditor for the audit of the world church who will then meet with the auditors to instruct them on areas of special interest, discuss internal control issues, and approve any non-audit services to be provided by the auditors. This latter will help prevent conflicts of interest when an auditing firm is providing other consulting services, Cooper said.
One amendment to the new procedures was proposed by Rodney G. Brady, treasurer of the church in the South Pacific region. The terms of reference now formally state what was informally agreed: church officers can be invited to meetings of the financial audit review committee, but will not automatically be present as invitees. Brady said this "separation of powers" is practiced in his region.
Both the restructuring language and the new terms of reference passed on a voice vote.
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