Industry — Non-Profit Organizations

Independent Audits for
Mission-Driven Organizations

We serve non-profits navigating grant requirements, donor accountability, and state regulatory mandates — delivering audits that satisfy every stakeholder.

Overview

Independent Audits That Satisfy Grantors and Build Donor Trust

Non-profit organizations occupy a unique position: they are mission-driven, often dependent on external funding, and simultaneously accountable to donors, grantors, the IRS, and state regulators. For many non-profits, the independent financial statement audit is the single most important annual financial process — it is the credibility mechanism that allows grantors to release funds, donors to give with confidence, and boards to demonstrate fiduciary integrity.

Most states trigger an audit requirement when a charitable organization's gross annual revenue exceeds $500,000, though thresholds vary by state. At the federal level, organizations expending $1,000,000 or more in federal awards (for fiscal years beginning on or after October 1, 2024) are subject to the Single Audit requirement under the Uniform Guidance (2 CFR Part 200). Major private foundations — Ford, Gates, Robert Wood Johnson — typically require audited financials for grants above $100,000 to $250,000.

Financial statement audits under US GAAP and GAAS

Single Audits (Uniform Guidance) for federal award recipients

Fund accounting expertise — unrestricted, temporarily restricted, permanently restricted

Form 990 and 990-T preparation and filing

Grant compliance testing and documentation

Management letters with internal control recommendations

What to Expect

Our Non-Profit Audit Process

Pre-Audit Planning

We review your prior-year financials, grant agreements, board minutes, and internal control documentation. We identify high-risk areas — particularly around grant compliance, revenue recognition, and functional expense allocation — and tailor our audit plan accordingly.

Fieldwork

We test account balances, verify grant expenditures against award terms, assess the segregation of duties in your accounting function, and confirm that restricted and unrestricted funds are properly segregated and reported. For Single Audits, we perform compliance testing for each major federal program.

SEFA Preparation (if applicable)

For organizations subject to the Single Audit, we assist with preparation of the Schedule of Expenditures of Federal Awards (SEFA), which lists every federal program expenditure for the year — a critical document for the compliance portion of the audit.

Reporting

We issue our audit opinion, financial statements, and — for Single Audits — the reporting package submitted to the Federal Audit Clearinghouse. We provide a management letter with any internal control observations and practical recommendations for improvement.

FAQ

Common Questions

What triggers a non-profit audit requirement?

Triggers include: (1) state law based on revenue thresholds (most states require audits when revenue exceeds $500K–$1M); (2) federal law — Single Audit required when federal expenditures exceed $1M (for fiscal years beginning on/after Oct 1, 2024); (3) grantor requirements — many foundations and government agencies require audited financials regardless of size; and (4) lender covenants if the organization carries debt.

What is the difference between a financial statement audit and a Single Audit?

A financial statement audit examines your overall financials and provides an opinion on whether they are fairly presented. A Single Audit includes everything in the financial statement audit PLUS compliance testing for each major federal program — verifying that federal funds were spent in accordance with award terms and federal regulations. Single Audits require additional reports including findings schedules and the SEFA.

Do we need an audit if we are a 501(c)(3)?

Tax-exempt status under 501(c)(3) does not exempt an organization from audit requirements. Whether you need an audit depends on your revenue level, your state of operation, the terms of your grant agreements, and any lender covenants. Many small nonprofits are not required to audit but choose to do so voluntarily to build credibility with donors and grantors.

Independent Audits forMission-Driven Organizations