Services
Compliance Audit Services
for DFW Businesses and Nonprofits
A compliance audit checks whether your organization is following the rules it has to follow. Those rules might come from a law, a grant agreement, a customer contract, a loan agreement, or your own written policies. We test what is actually happening, compare it to the requirement, and give you a written report of what we found.
Parr & Ibarra CPA performs compliance audits for businesses, nonprofits, and franchise groups across Hurst, Keller, Grapevine, Addison, and the Dallas-Fort Worth area. Audits are performed by P&I CPA PC.
* Audits are performed by P&I CPA PC
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Determining Your Regulatory Obligations
What a Compliance Audit Covers
Compliance audits are often triggered by external mandates rather than a simple desire for financial review.
Regulatory Compliance
We test whether you meet the federal and state requirements that apply to your organization. The goal is to find gaps early, before they turn into fines or legal trouble.
Contractual and Grant Compliance
We check whether you are meeting the exact terms of your contracts and funding agreements. For grants, that includes how funds were spent, whether costs were allowed, and whether required reports were filed on time.
Loan Covenant Compliance
Many loan agreements require you to stay within certain financial ratios and reporting terms. We test whether you are meeting them, so there are no surprises when your lender asks.
Internal Policy Audits
We check whether your team follows the written policies your leadership has set, such as approval limits, expense rules, and cash handling.
Operational Testing
We go beyond the paperwork. We look at how work really gets done day to day, to confirm that compliance is happening in practice and not just on paper.
Compliance Audit vs. Financial Statement Audit
A financial statement audit gives an opinion on whether your financial statements are fairly presented. A compliance audit gives a conclusion on whether you followed a specific set of requirements. They can be done together, as in a Single Audit, or on their own.
If the party asking for the check only needs certain procedures performed and reported, an agreed-upon procedures engagement may be a smaller and lower cost option. We can help you work out which one fits.
Financial Statement Audit | Complete Guide to Audit and Assurance
Who Typically Needs a Compliance Audit
Compliance audits are usually driven by an outside requirement, not by choice.
Nonprofits and organizations with grants. Federal and state grants come with spending and reporting rules. Organizations that spend $1,000,000 or more in federal awards in a fiscal year need a Single Audit, which includes a compliance audit of each major federal program. Read our Single Audit guide.
Businesses with loan covenants. Your bank may require proof that you are meeting specific financial ratios and reporting terms.
Franchisees and franchisors. Franchise agreements often include reporting and royalty requirements that need to be verified.
Businesses with contract requirements. Some customer or vendor agreements require a third party to verify your processes.
Organizations that want to get ahead of a problem. An independent check before a regulator, grantor, or lender asks is often cheaper than fixing a problem after they find it.
If a regulator or contract requires a specific type of compliance report, send us the requirement. We will confirm whether it is something we can perform before you engage us.
How Our Compliance Audit Process Works
1. Confirm the requirement
We read the law, agreement, or policy you are being tested against. We confirm the scope, the period covered, and who will receive the report.
2. Plan and assess risk
We focus our testing on the areas with the highest chance of non-compliance.
3. Test
We review records, sample transactions, and talk with your team. We also observe how key processes work.
4. Report
We issue a written report that states what we tested, what we found, and our conclusion, in the format the requirement calls for.
5. Recommend fixes
We go over each finding with management and recommend practical corrections so the same issue does not come back.
A note on independence. Compliance audits require independence. If we also do your bookkeeping, payroll, or other accounting work, we may not be able to audit the same area. We review this with you before the engagement starts.
Why Work With Parr & Ibarra
Independent CPA firm
Our reports carry the weight of an outside, objective review that internal checks cannot provide.
Risk-based testing
We spend time where the risk is highest, so you get more value for the fee.
Careful reading of agreements
Adan Ibarra’s legal education helps us read grant agreements, contracts, and loan terms closely, and test against what they actually say.
Plain-language reporting
We explain findings in a way owners, boards, and program staff can act on.
The Parr & Ibarra Difference
Frequently Asked Questions
What is a compliance audit?
A compliance audit is an independent review of whether your organization follows a specific set of requirements, such as a grant agreement, a contract, a loan covenant, or a regulation. The auditor tests your records and processes and reports the results in writing.
How is a compliance audit different from a financial statement audit?
A financial statement audit tests whether your financial statements are fairly presented. A compliance audit tests whether you followed specific rules. Some engagements, like a Single Audit, include both.
How long does a compliance audit take?
It depends on the scope, the size of the organization, and how organized your records are. We give you a timeline after we review the requirement. Single Audits have set federal deadlines. The report is due to the Federal Audit Clearinghouse by the earlier of 30 days after you receive the auditor’s report or nine months after your fiscal year ends.
How much does a compliance audit cost?
Fees depend on what is being tested and how much testing is needed. We review the requirement first and give you a quote before any work begins.
What if the audit finds a compliance gap?
We report it in writing and recommend ways to fix it. Depending on your agreement, you may need to tell your grantor or lender. We help you understand what is required and what to do next.
Can you do a smaller engagement instead of a full compliance audit?
Sometimes. If the requesting party only needs specific procedures performed, an agreed-upon procedures engagement can be a narrower option. The party asking for the report has to agree to the procedures, so check with them first.
Contact Us
Need a Compliance Audit?
Parr & Ibarra CPA serves businesses and nonprofits throughout Hurst, Keller, Grapevine, Addison, and the broader DFW area. Send us the requirement you are trying to meet and we will tell you what it takes.
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