NONProfits are sometimes required to have formal outside audits?
Audits build donor confidence and increase protection against fraud.
If you have $500,000 or more a year in Federal grant expenses – You are required to have an outside audit - ‘ a single audit' to test for compliance
States have varying audit threshold requirements – You must contact the state you receive grant dollars from to obtain their audit requirements
Many foundation funders ask for an annual audit as a condition of funding.
A Nonprofit may elect to have an external CPA firm provide an Expert Written Opinion Rather than a full-blown audit