The growth of a not-for-profit organization requires a commitment to fulfilling certain obligations. One of those obligations is conducting a regular not-for-profit audit. There are different audit requirements based on annual revenue, state, and methods of incorporation.
Constitution Requirements
Sometimes, the Not-for-profit bylaws might require you to conduct annual or regular financial statement audits for the grantors and stakeholders.
State requirements
Not-for-profit receiving above $500,000 in a fiscal year must conduct a financial statement audit. However, the revenue cap varies for different states. So, you must confirm state requirements or consult a CPA firm for guidance.
Federal requirements
Not-for-profit organizations that receive funding that exceeds $750,000 from the federal government as contracts or direct donations must conduct a regular financial statement audit.
Read more here.
Grant application requirements
Some grantors require a financial statement audit report to assess the organization’s credibility. The outcome of the audit will determine if they will commit or not.
Note: An independent CPA must conduct the financial statement audit for transparency and compliance with accounting standards. Contact MetwallyCPA to audit your non-profit organization.
