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Posted by Benjamin Yazersky CPA on March 28, 2007, 5:53 pm
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> A couple of years ago we acquired a non-profit organization
> middle management group return. Their bookkeeping system (if
> that) is as old the leather bound gold embossed big green
> book that they post their expenses and income in. It took
> dozens of hours of meetings with the Quartermaster to figure
> out what the expenses were for and how to organize the
> income and expenses for proper NP treatment on the return.
> The following year they came back again with the same green
> book. This time I didn't have the stomach to put the
> transactions in order and we passed the job on to a
> bookkeeper. Unfortunately she didn't understand what I
> needed and attempted to prepare the return with her work.
> After several months I got the detail that I could sort and
> shuffle and mark off to prepare the return. By this time it
> was late and the NP is being fined about $2000 for late
> filing. They have never filed before the previous year.
>
> This year their bookkeeping is just as bad if not worse. The
> categories and activities have changed. Once again the
> bookkeeper has entered the data and I have to sort it out.
> There is no way the big green book is going to be useful in
> preparing a 990. You might as well throw all the
> transactions into the air and sort them out that way.
>
> Is there any way we can get the NP out of the penalty? Their
> hierarchy requires them to use the bookkeeping system from
> the 1920's although without green eyeshades, quill pens and
> winged collars. The only hope for future years is that their
> new Quartermaster is a CPA and is willing to use a computer.
> I am meeting with him this week before he assumes office to
> set up proper bookkeeping for our purposes.
please remind me never to take on this type of client <g>
ok-sarcasm aside
my experience is that the IRS generally seems to be more
interested in compliance than penalties with non profits its
important to make contact with the IRS folk & work with them
if you can give them what needs to be filed & can explain
your client's 17th century recordkeeping system (and that
they've been doing it this way since the year of the flood),
you may be able to get some sympathy toward abating the
penalties
___________________________________
<<< Benjamin Yazersky, CPA [NJ & NY] >>>
-----> real address on hobokeni or hobokenx <-----
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