Want to see what is on a typical Audit Notice?

This past week I was contacted by several clients who received Audit Letters in the mail. One of them sent me a copy of the Audit Letter to review. 


The Audit Letters are ominous because they are more robust than I have seen in the past and indicate the State is aggressively incorporating federal guidelines. It’s not just about state regulations anymore.  

I think it would be a good idea for you to think about the below, and email me with questions. Some of these things might apply to you.

Here are some examples of just a few of the items included in the eleven page Audit Letter.

  • Emphasis on MLO Employment Contracts and Employee Files, likely to investigate compliance with training and to analyze your W-2 versus 1099 situations
  • List of third party providers to investigate Privacy Act Compliance, possible unreported ABA situations,  and payments between entities
  • Form 941 – Federal Employer Quarterly Tax Return (I told you so)
  • Warehouse Line Agreements – looking for more than one agreement and comparing financials used for line approval with actual books and records
  • Advertising Log with samples back two years
  • Proof of Acceptance of Duties of Managers and Officers
  • Bank Accounts verifying third party payments and CFPB Comp Plan commission compliance
  • Corporate Minutes or LLC Records to establish Compliance as ongoing topic of Management
  • Random spot checks of minimum net worth requirement at any point in time to detected unreported deficiencies in net worth

I have the actual audit letter should anyone want to discuss it.

Call us at (800) 656-4584.