It has been my pleasure to be the Chair of the SOT Audit Committee for the 2013–2014 term. This is an important job in SOT, but fortunately because of strong internal controls and a solid bank balance, it is not stressful. Although not-for-profit organizations are not specifically required by Sarbanes Oxley regulations to have an audit committee, SOT’s independent auditors and Finance Committee felt that establishing such a group would further enhance SOT’s internal controls, so in 2008 SOT established an Audit Committee. The Committee has the responsibility of examining the processes, procedures, and controls in place for the daily financial operation of the Society; engaging the independent auditors; and otherwise overseeing the annual independent financial audit.
The accounting firm of Dixon, Hughes and Goodman (DHG) performed the 2013 audit. The financial statements were found to be “fairly stated” and the audit was “clean,” meaning that it did not include a management letter with recommendations for enhancements of accounting practices. Because the Society’s journal,Toxicological Sciences (ToxSci) is published by Oxford University Press (OUP) with financial records kept in the UK, the SOT audit was qualified for those accounts, which were not audited. In 2012–2013, the Audit Committee engaged DHG to travel to the OUP offices in Oxford, UK to review the ToxSci records and processes. The audit revealed no concerns and the few suggestions for enhancement of internal controls have been sent by the Audit Committee to OUP.
In the fall of 2013, Kim Boekelheide, Audit Committee member, and I traveled to SOT Headquarters for the bi-annual evaluation of office financial practices. We met with the staff, starting with the receptionist who logs in the checks received by mail, and including the registration and endowment record manager, the e-commerce manager, and the Director of Accounting. We discussed accounting controls, procedures for archiving financial data, and routine back-up procedures for protecting the integrity of the data, as well as procedures for risk management. All was in excellent order.To complete the 2013 Audit Committee review, Jim Klaunig reviewed our Morgan Stanley investment statements and reported that the policies and procedures for SOT investments were being followed as specified per fund in the SOT Financial and Investment Policies.
Overall, Society members can rest assured that the Society has an excellent system of accounting checks and balances and that its financial operations are in good order.