California auditor & CPA Nonprofit Audits Not-for-profit Auditing Non-profit CPA Noe & Co Oakland, CA

Deeply immersed in the not-for-profit sector, our professionals have significant experience guiding organizations to reach their goals. We provide solutions specific to the nuances, challenges, and operations of not-for-profit organizations—while customizing plans to meet your unique needs. From planning and compliance to strategic advisory services, our solutions offer a full suite of financial statement audit services.

• This is but one factor among many that has already convinced us that Cerini is the right firm for us as we continue to grow.
• These requirements, governed by accounting standards and regulations, ensure financial information is presented accurately.
• For instance, states like New York and California mandate audits for nonprofits with gross annual revenue or contributions exceeding specific thresholds.
• Use Google to find at least three options (based on reviews and portfolios) for CPAs or auditing firms that work with nonprofits.

Why are audited financial statements important for nonprofits?

A poorly prepared financial report can cause management or board members to receive incorrect financial information. This can result in penalties, worse yet material fraud, including misappropriation of funds. The statement of activities captures the flow of resources and the fulfillment of the nonprofit’s mission. Revenues and expenses are categorized by unrestricted, temporarily restricted, and permanently restricted funds, providing transparency on resource utilization. For example, grants designated for specific projects must be clearly reflected in this statement. When considering the https://nerdbot.com/2025/06/10/the-key-benefits-of-accounting-services-for-nonprofit-organizations/ qualifications an auditor should possess, it is vital to assess their credentials and adherence to industry standards.

Types of Nonprofit Audits

By performing regular audits on your own, you’ll be prepared for these requests. Finally, nonprofits that understand the benefits of audits will include this requirement in their organization’s bylaws, making this mandatory each year. If your nonprofit relies on grant funding, you’ve probably noticed that these organizations want financial reports that have been audited. The federal government is not the only one that requires regular audits by nonprofits. One-third of all states in the US need nonprofits to perform regular audits if they solicit The Key Benefits of Accounting Services for Nonprofit Organizations state residents.

• There are individual auditors or entire audit firms that specialize in the nonprofit sector.
• In Illinois, nonprofit audit requirements mandate that charitable organizations with annual revenue over $300,000 file audited financial statements with the state’s Attorney General as part of their registration.
• This type of audit generally addresses issues with your tax return, discrepancies between your organization’s and freelancers’ or employee returns, or if a division of the IRS issues an IRS-wide examination.
• Shortly after receiving the report, schedule a leadership team meeting to review it in detail and create an action plan that addresses everything the auditor identified across all relevant areas of your organization.
• Get in touch to find out how we can help you with your accounting, tax and financial needs.

Independent Audit Process for Nonprofits

Your organization’s development team assigns an audit committee to perform internal audits. “If a firm has a clear audit methodology, including the workpapers to use, it helps with issues of lack of industry expertise and using out-of-date programs and checklists,” Prather said. He recommended the use of standard workpapers and third-party practice aids and then tailoring them to engagements.

If your organization is preparing for its next audit—or undergoing one for the first time—reach out to Dimov Audit for a consultation. We’ll help you stay audit-ready, donor-trusted, and financially transparent. These audits are often reviewed by federal oversight agencies, making accuracy and experience critical. Dimov Audit’s team has deep experience navigating these nonprofit-specific challenges and ensuring accurate, compliant reporting. Donors need to trust an organization before they contribute a one-off gift or recurring funding, and an independent audit provides them with that much-needed reassurance. Nonprofit audits might sound intimidating, but they are far less scary than you think.

• Nonprofits are subject to specific accounting standards, such as the Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) 958, which governs the presentation of financial statements.
• Those who know me, know I’m a firm believer in the idea that there is nothing new under the sun.
• Regular audits enhance financial transparency, fostering trust among donors and beneficiaries.
• Our service lines are supported by our staff to ensure client satisfaction with whatever their needs be.
• Was it for the unsavory feeling of making exorbitant profits like Shylock, the Semite he abhorred?