990-EZ amend & Net Assets fix

USA Discussion in 'General Tax Discussion' started by suiathon, Aug 3, 2018.

  1. suiathon


    Jun 30, 2016
    Likes Received:
    I started working with a nonprofit and their 990-EZ doesn't appear to have been correctly filled out for the past several years. Should I amend or just fill out correctly from now on? It's a small organization with less than $100,000 in receipts. Their beginning/ending balances never match to the prior year's 990-EZ and their end of year bank balance equals receipts which is not correct. They also show no expenses. My state has a 3 year statute of limits, which is extended to 6 for reasons I cannot remember right now.

    Another questions - they have been making a journal entry at the end of each year to move net income back to the profit/loss statement. Obviously this needs to be fixed. How far back should I fix this issue, or can I simply just delete the entries they made on 12/2017 & 1/2018 and go on from there? I can adjust retained earnings accordingly. As an auditor, I'd normally fix the mistake at year-end, but in this case I'd probably fix it at month end. They don't use comparative statements.

    suiathon, Aug 3, 2018
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