PREU ENTERPRISES, INC.
14547 MONETA ROAD
P. 0. BOX679
MONETA, VIRGINIA 24121
BUSINESS & PERSONAL TAX PREPARATION & ACCOUNTING
540-297-6766 FAX: 540-297-3548
JON LESTER PREU
CAROL JOY PREU
June 15, 2011
At the request of Lake Christian Ministries, Inc., (LCM) a comprehensive review was performed on the organization's 2010 books of account. The review covered deposits to and disbursements from the checking account, bank reconciliations, internal controls, and support schedules.
We conducted our review in accordance with generally accepted review standards and accounting procedures as required by the Internal Revenue Service Code as an organization described in section 501 c (3) to be treated as a publicly supported organization. Those standards require examination, on a test basis, of evidence supporting the amounts and disclosures in the financial statements. Reasonable assurance that the financial statements are free of material misstatement is based on these standards. The accounting principles used and management decisions made were assessed during the review. An overall evaluation of the financial statements' presentation was made which verified year-end checking and savings account balances, as reported by the Treasurer in his financial summaries of the calendar year ending December 31, 2010. "Financial Statements" as used here are defined to include the records as provided by the Treasurer. It is our responsibility to express an opinion on these records based on our review. We believe our review provides a reasonable basis for our opinion.
Review: The following summarizes the results of this review: In all material respects our review confirmed the accuracy of LCM's financial records. This determination is based on our random sampling of documentation supporting deposits and disbursements.
1. All of the randomly selected checks written were matched to the bills paid. As a matter of procedure the bills paid by the Treasurer were filed according to the month paid, and the computerized check stubs were attached to each of the bills.
2. An assistant treasurer received LCM's monies and prepared a log of each check, or cash. The money was then given to the Treasurer who prepared a deposit slip and deposited it into the bank. We found in all cases that deposited receipts equaled the total income reflected on the income and expense statements provided by the Treasurer. Monthly bank reconciliation reports verified the accuracy of the deposits and expenditures.
3. LCM's Treasurer uses a professional accounting program to carry out the complex disbursements inherent in the nature of the organization. This system produces an audit trail which details each transaction, and provides a system of internal controls. Upon our recommendation the balance sheet wording "Retained Earnings" was changed to "Fund Balance" conforming to IRS wording concerning non-profit organizations.
4. The Treasurer demonstrates meticulous record keeping, and is clearly an asset to Lake Christian Ministries, Inc. His financial statements provide factual information to assist LCM in making sound decisions for future growth.
With respect to this review, it is our opinion, based on the records provided, the financial statements produced are free from material misstatement. We appreciate the confidence placed in us and the opportunity to be of service to your organization.
Respectfully submitted, (Jt AK)-t Carol J. Preu