These are their stories.
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30 Audits and Going Strong
Our intrepid, blurred-out hero this week is, well, let’s call him The Fuzz (because his video likeness is fuzzy. Get it?). The Fuzz is a CFO at a credit union, and he’s been through more than 30 audits over a score of years. Needless to say, he’s got some serious chops when it comes to NCUA regulations.
One of the great things about surviving so many audits is that you start to get a feel for what kinds of questions they’ll ask. You also start to understand what kind of information and documents you might need to provide.
In the case of The Fuzz, he tended to err on the side of caution. In the audit world, that’s the right move.
Gotcha Journalism, Minus the Journalism
The thing about credit union exams and audits is that the rules are always changing. Every year, depending on whether a new disruptive technology has come out, or there’s a change in federal interest rates, or if it’s just time for a little revamp, NCUA rules and regulations evolve to fit the current financial landscape.
Not only are there new NCUA regulations to worry about, but every so often, there are new auditors.
Our CFO, The Fuzz, noticed that a lot of the younger NCUA examiners tended toward eagerness. They weren’t just looking that things were going right—they were critically examining frequent trouble areas or newly-changed NCUA regulations to spot even the slightest errors.
If there was so much as the shadow of a blemish, they’d find it.
Fortunately, The Fuzz always has three major things going for him during audit season:
- Strong preparation
- Assiduous organization
- Open lines of communication
Preparation gets easier every year. Experience has its benefits. However, if you’re not an old hand with NCUA audits, you can check out the link to our audit checklist at the end of this blog.
Organization is critical for audits. All involved personnel in an audit are responsible for the timely and complete collection of documents and answers.
When it comes to organizations, our CFO, The Fuzz, overprovides. He knows that the young guns are looking to prove themselves by finding fault in a credit union’s practices, and usually, he says, they go straight for allowances and investment portfolios. However, he also notices that this is an area in which the examiners aren’t always as well-versed as he and other CFOs are.
They find something that looks questionable to them, and they get ready to strike!
But that’s where open lines of communication come in. The Fuzz makes sure that there are clear lines of communication between him and the lead, so any additional questions can be quickly and easily put to rest.
![audit checklist](/images/actions/audit-checklist.png)
FREE: Audit Checklist for Credit Unions
4 key principles and 9 questions to jumpstart your audit planning. From leading credit unions.Is There a Happy Ending?
This time, yes, there is a happy ending. Recently, the NCUA auditor’s biggest ding on his credit union was that they overprovided. It wasn’t actually an issue.
Instead, the NCUA official reminded him about upcoming CECL and was on his way.
Regardless of your past experience, credit union exams can throw curveballs your way. Some, like the above, may be unavoidable even with demonstrable compliance. Others can be avoided with good planning and great audit tools.
Our CFO, The Fuzz, is extraordinarily organized, prepared, and communicative. However, not everyone has more than 20 years of experience with NCUA audits, and it can be stressful and difficult to adequately ready oneself.
Then, when you’re ready, check out our NCUA Audit Checklist.