Regulatory scrutiny around labor unions often changes with a new administration so the need for accurate LM-2 reporting has never been more important. The Department of Labor (DOL) has emphasized its intention to reinforce transparency and compliance across financial disclosures, emphasizing detailed, timely and accurate LM-2 filings; something no union can afford to overlook.
The Risks of Poor LM-2 Reporting
Compliant LM-2 reporting isn’t just an end-of-year hurdle; it’s a reflection of a labor union’s entire financial ecosystem. Every disbursement, receipt, and asset needs to be accurately tracked, categorized and reconciled. This means timely and accurate reporting begins with clean and consistent accounting practices. Without a strong, reliable accounting process, even the most well-intentioned labor union can run into reporting challenges and errors, which could trigger further inquiry by the DOL.
Why Solid Accounting Practices Matter
A well-designed classification system provides an effective method for improving LM-2 reporting accuracy. Correctly classifying transactions at the time of original entry ensures expenses flow smoothly into the correct schedules, significantly reducing the time and complexity of year-end reporting. Appropriate classification systems can also give union leadership a clearer picture of where funds are going, allowing for better strategic decision-making. These factors are becoming more and more critical given the heightened focus on financial transparency.
Partnering with Experts for Seamless Compliance
Partnering with experienced professionals who understand union accounting, DOL compliance and LM-2 reporting requirements ensures unions remain compliant without overextending internal resources. Withum works closely with labor union clients to take the stress out of LM-2 filing by ensuring all transactions are accurately tracked and reports are filed on time and fully compliant with DOL standards. We tailor our accounting services to meet the unique needs of labor unions, including:
- Year-round, audit-ready financial management
- LM-2 reporting that meets DOL standards
- Simulated CAP audits
- Tax support services catering to the unique needs of labor unions
Takeaways
Ultimately, precise LM-2 reporting isn’t just about compliance; it is about building trust, strengthening governance, and ensuring accountability to its members. Investing in proper accounting practices and establishing robust compliance and regulatory reporting processes can protect your union’s integrity and create a strong, transparent foundation that stands firm regardless of which administration occupies the White House.
Author: Jamie Schaefer | [email protected]
Contact Us
Reach out to our Labor Unions Services Team to learn how we can help streamline financial reporting and alleviate LM-2 reporting stressors for you.
