Independent Audit Frequently Asked Questions
1What is an independent audit of a nonprofit?
An independent audit is simply the examination of a nonprofit organization's financial records and business transactions by a Certified Public Accountant.
2Are there any alternatives to having an independent audit?
Yes there are alternatives such as a review or a compilation. However, if an independent audit is required by law, your nonprofit must comply.
3Does my organization have to hire an independent auditor annually?
Laws vary from state to state. Some states require nonprofits engage with an independent auditor if they receive a certain level of funding from a state agency. Some private foundations may require a nonprofit grantee to conduct an independent audit. For more information about specific states, please contact us.
4Do federal grantees need to have an audit?
If you nonprofit receives and expends $750,000 of federal funds annually, an independent audit is a requirement.