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State Law Nonprofit Audit Requirements

Does your state's law require an independent audit?

You may wonder if your state's laws require a charitable nonprofit to conduct an independent audit.

  • Remember that some private foundations may require or expect a nonprofit grantee to conduct an independent audit;
  • A few states have laws that require nonprofits that receive a certain level of state funding to submit independent audits to the state agency that provided the funding or to other state agencies. If your nonprofit receives any government funds --state or federal -- it is always a good idea to determine whether there is an accompanying  audit requirement.
  • Some state government contracts may require an audit; there is a federal requirement to conduct an independent audit if the nonprofit expends $500,000 or more in federal funds in a single year. (Note the threshold will be raised to $750,000 in 2015).
  • Many states (26) require charitable nonprofits to submit a copy of audited financial statements in conjunction with the process of registering the charitable nonprofit so that it is able to lawfully engage in fundraising activities in that state (commonly known as "charitable registration").

State laws regulating independent audits are different state-by-state.

The obligation to file an independent audit report with the state government is generally just one requirement among many in connection with charitable solicitation registration. Thirty-nine states (including the District of Columbia) require charitable nonprofits to register with the state in order to fundraise in that state. Those 39 state laws often differ from one another. Consequently, the laws that require a charitable nonprofit to submit audited financial statements also vary state-by-state. 

  • Twenty-six states have laws requiring charitable nonprofits to conduct an independent audit under certain circumstances. The requirement for a nonprofit to submit audited financial statements to the state is most often triggered by either the total revenue received by the charitable nonprofit during the fiscal year, or the total contributions received. In some states the threshold of contributions or income received that triggers the independent audit requirement is relatively low; in other states the threshold is higher.
  • Twenty-four states also require annual submission of audited financial statements in connection with renewal of charitable registration.
  • These requirements for both initial and annual submission of audited financial statements may not apply to your nonprofit even if it is operating in a state where audit requirements exist since the requirements depend on specific circumstances, such as the amount of revenue contributed or the annual gross income of the charitable nonprofit - such details are specified in each state's law.

This Nonprofit Audit Guide© provides links to the state laws that address audits so that you can determine what your state requires. Remember that this chart only addresses state law requirements, and that your nonprofit may also be required to submit an independent audit report to private funders upon request, and will be subject to federal audit requirements if it expends more than $500,000 in federal funds in a single year. Some State government contracts may also include the requirement to conduct an independent audit.

Click on a state in the map below to find a link to the applicable state law that governs audit requirements (if applicable) for charitable nonprofits in that state. In some cases we provide links to the language of state laws that require other reports be filed with the state, such as an "annual financial report." Remember that if your nonprofit is registering for charitable solicitation purposes in a state other than its own, you should check the requirements for audits in that other state(s).

State Law Nonprofit Audit Requirements: 50-State Chart

US map

 (Updated as of May 2013)

Disclaimer: The National Council of Nonprofits is not engaged in the practice of law and this chart does not constitute legal advice. We encourage you to consult with legal, tax, or other professional advisors who can provide guidance for your charitable nonprofit’s individual circumstances.

Alabama

Audit Required: No state law requirement.
Statute and Description: Alabama Code § 13A-9-71

Alaska

Audit Required: No state law requirement.
Statute and Description: Alaska Stat. § 45.68.010 - 45.68.900

Arizona

Audit Required: No state law requirement.
Statute and Description: Ariz. Rev. Stat. § 10-11622

Arkansas

Audit Required: Yes
Statute and Description:
Ark. Code §4-28-403(b) | A charitable organization with gross annual revenue over $500,000 must file an audited financial statement prepared by an independent CPA.

California

Audit Required: Yes
Statute and Description: Cal. Gov. Code §12586(e)(1) | A charitable corporation with gross annual revenue of $2 million or more AND that is already required to file report(s) with the General Attorney must file an audited financial statement prepared by an independent CPA.

Colorado

Audit Required: No state law requirement.
Statute and Description: Colo. Rev. Stat. § 6-16-104 

Connecticut

Audit Required: Yes
Statute and Description:
Conn. Gen. Stat. § 21a-190c(b) | A charitable organization with gross annual revenue over $500,000 must file an audited financial statement prepared by an independent CPA.

Delaware

Audit Required: No state law requirement
Statute and Description: Del. Code tit. 6 § 25-10

District of Columbia

Audit Required: No state law requirement.
Statute and Description: D.C. Code § 29

Florida

Audit Required: Yes
Statute and Description: Fla. House Bill 0629 (2014) requires audits for charitable organizations as follows: For those receiving annual contributions of $1 million or more an independent audit is required; for those with $500,000+  but less than $1 million in charitable contributions annually, the financial statements must be reviewed or audited by an independent CPA, and for those with less than $500,000 in annual contributions, either an audit, review, or compilation is acceptable.

Georgia

Audit Required: Yes
Statute and Description:
Ga. Code Ann. § 43-17-5(b)(4) | A charitable organization with contributions over $1 million in either of its two preceding years must file an audited financial statement prepared by an independent CPA.  A charitable organization with contributions less than $1 million and over $500,000 in either of its two preceding years must have its financial statement reviewed by an independent CPA. Exceptions: Ga. Code Ann. § 43-17-9

Hawai'i

Audit Required: Yes
Statute and Description:
Haw. Rev. Stat. § 174: 467B-6.5(b) | A charitable organization with gross annual revenue over $500,000 must file an audited financial statement prepared by an independent CPA.

Idaho

Audit Required: No state law requirement.
Statute and Description: Idaho Code Ann. § 30-3-136

Illinois

Audit Required: Yes
Statute and Description:
225 Ill. Comp. Stat. § 460/4 | A charitable organization with annual contributions over $300,000 must file an audited financial statement prepared by an independent CPA. A charitable organization with contributions less than $300,000 and more than $25,000 is only required to file an audited financial statement prepared by an independent CPA if a professional solicitor engages in fundraising. 

Indiana

Audit Required: No state law requirement.
Statute and Description: Ind. Code § 23-17-27

Iowa

Audit Required: No state law requirement.
Statute and Description: Iowa Code § 504.1613

Kansas

Audit Required: Yes
Statute and Description:
Kan. Stat. Ann. § 17-1763(c) | A charitable organization with annual contributions over $500,000 must file an audited financial statement prepared by an independent CPA.

Kentucky

Audit Required: No state law requirement.
Statute and Description: Ky. Rev. Stat. Ann. § 14A.6-010

Louisiana

Audit Required: Yes, in certain circumstances, if receiving state funds.
Statute and Description:
La. Rev. Stat. Ann. § 24:513(J)(1)(c)
| A nonprofit that meets the definition of “quasi-public agency” will be required to conduct an annual independent audit if the nonprofit receives $500,000 or more in revenues in any one fiscal year; a financial review is required if annual revenue is $200,000 or more but less than $500,000; a compilation is required if annual revenue is $50,000 or more but less than $200,000. See LA State Audit Guide for more information.

Maine

Audit Required: Yes
Statute and Description:
Me. Rev. Stat. Ann. tit. 9 § 5004(4)(C-D) | A charitable organization must be licensed in Maine. The license application does not require an audited financial statement. However, the license must be renewed annually. A charitable organization is only required to file an audited financial statement if the organization already has one in existence at the time of renewal or applies for renewal after the expiration date. Otherwise, the organization may file a balance sheet in lieu of an audited financial statement. Exceptions: Me. Rev. Stat. Ann. Title 9 § 5005

Maryland

Audit Required: Yes
Statute and Description:
MD Solicitations Act §6-402 (b)(8) | A charitable organization must file an audited financial statement prepared by an independent CPA if the gross income from charitable contributions is at least $500,000. For organizations with gross annual contributions less than $500,000 the Secretary of State may require financial statements to be reviewed by an independent CPA.

Massachusetts

Audit Required: Yes
Statute and Description:
Mass. Gen. Laws ch. 12, § 8F | A public charity with gross annual support and revenue over $500,000 must file an audited financial statement prepared by an independent CPA together with its annual report. A public charity with gross annual support and revenue less than $500,000 and more than $200,000 must file a financial statement that is either reviewed or audited by an independent CPA.

Michigan

Audit Required: Yes
Statute and Description:
Mich. Comp. Laws § 400.273 Sec 3(2)(j) | A charitable organization with annual contributions of $500,000 or more must file an audited financial statement prepared by an independent CPA. A charitable organization with annual contributions less than $500,000 and at least $250,000 must file a financial statement that is either reviewed or audited by an independent CPA.

Minnesota

Audit Required: Yes
Statute and Description:
Minn. Stat. § 11.309.53(3) | A charitable organization with total annual revenue over $750,000 must file an audited financial statement prepared by an independent CPA.

Mississippi

Audit Required: Yes
Statute and Description:
Miss. Code Ann. § 79-11-507 | A charitable organization with annual contributions over $100,000 must file an audited financial statement prepared by an independent CPA. The Secretary of State may require an audited financial statement prepared by an independent CPA if the organization’s annual revenue is less than $100,000 and at least $25,000. But, every charitable organization that uses a professional solicitor in its fundraising functions must file an audited financial statement prepared by an independent CPA.

Missouri

Audit Required: No state law requirement.
Statute and Description: Mo. Rev. Stat. § 355.865.1

Montana

Audit Required: No state law requirement.
Statute and Description: Mont. Code Ann. § 35-2-904

Nebraska

Audit Required: No state law requirement.
Statute and Description: Neb. Rev. Stat.§ 21-1903

Nevada

Audit Required: No state law requirement.
Statute and Description: Nev. Rev. Stat. § 82.536

New Hampshire

Audit Required: Yes
Statute and Description:
N.H. Rev. Stat. Ann. § 7:28(III-b) | A charitable organization with revenue, gains, and other support of $1 million or more must file an audited financial statement prepared by an independent CPA; nonprofits receiving support of $500,000 or more must submit “the organization's latest financial statement prepared in accordance with generally accepted accounting principles.” Note: If compliance would constitute a financial burden, nonprofits may request an exemption, which, if granted, is valid for 3 years.

New Jersey

Audit Required: Yes
Statute and Description:
New Jersey Admininstrative Code N.J.A.C. 13:48; reprinted on the website of the Division of  Consumer Affairs, Charities Registration Unit. A charitable organization with total annual revenue of $500,000 or above must submit an independent audit. For those with gross revenue between $25,000 and less than $500,000, the financial statements must be certified by the organization's president or other authorized officer. For more information contact the Center for Non-Profits.

The new regulations may be found in the February 22, 2011, New Jersey Register (43 N.J.R. 439 (a)) and on the Division of Consumer Affairs' Web site at http://www.nj.gov/lps/ca/adoption/charado_022211.htm. The full text of the charitable fund raising regulations are in the New Jersey Administrative Code at N.J.A.C. 13:48 . - See more at: http://www.njnonprofits.org/CharReg_NewAuditThreshold_04182011.html#stha... Jersey Register 43 N.J.R. 439(a) reproduced on the Division of Consumer Affair's website.
(43 N.J.R. 439 (a)) and on the Division of Consumer Affairs' Web site at - See more at: http://www.njnonprofits.org/CharReg_NewAuditThreshold_04182011.html#stha... |  A charitable organization with gross annual revenue over $500,000 must file an audited financial statement prepared by an independent CPA. If the organization had between $25,000 and $500,000 in revenue the financial statements must be certified by the nonprofit's president or other authorized officer of its governing board. More information is available from the Center for Non-Profits.
if an organization had gross revenues of $500,000 or more in the most recently competed fiscal year, the financial report must be accompanied by an independent audit. If an organization filing had gross revenues of between $25,000 and $500,000, the financial report must be certified by the organization's president or other authorized officer of its governing board. - See more at: http://www.njnonprofits.org/CharReg_NewAuditThreshold_04182011.html#sthash.hsmv6TLR.dpuf
if an organization had gross revenues of $500,000 or more in the most recently competed fiscal year, the financial report must be accompanied by an independent audit. If an organization filing had gross revenues of between $25,000 and $500,000, the financial report must be certified by the organization's president or other authorized officer of its governing board - See more at: http://www.njnonprofits.org/CharReg_NewAuditThreshold_04182011.html#sthash.hsmv6TLR.dpuf

New Mexico

Audit Required: Yes
Statute and Description:
N.M. Stat. § 57-22-6 | A charitable organization that has revenue in excess of $500,000 "shall be audited by an independent auditor."

New York

Audit Required: Yes
Statute and Description:
N.Y. U.C.C. Law 7A § 172-b | A charitable organization with gross annual revenue over $250,000 must file an audited financial statement prepared by an independent CPA. A charitable organization with gross annual revenue less than $250,000 and at least $100,000 must file a financial statement reviewed by an independent CPA. But, every charitable organization that uses a professional solicitor in its fundraising functions must file an audited financial statement prepared by an independent CPA.

North Carolina

Audit Required: Yes, in certain circumstances, if receiving state funds.
Statute and Description: N.C. G. S. 143C-6-23 | A non-governmental entity that receives $500,000 or more annually in state funds, must submit a  "Yellow Book" Audit done by CPA that includes a Schedule of Federal and State Awards (PDF file) (Excel file). The complete report to the funding agency and to the Office of the State Auditor is due within 9 months of organization's year end. Note: An A-133 audit may be substituted for the yellow book audit.

North Dakota

Audit Required: No state law requirement.
Statute and Description: N.D. Cent. Code § 50-22-04

Ohio

Audit Required: No state law requirement.
Statute and Description: Ohio Rev. Code § 1716.04

Oklahoma

Audit Required: No state law requirement.
Statute and Description: Okla. Stat. tit. 18, § 18-552.3

Oregon

Audit Required: No state law requirement.
Statute and Description: Or. Rev. Stat. § 65.787

Pennsylvania

Audit Required: Yes
Statute and Description:
10 Pa. Cons. Stat. §162.5 (f) | A charitable organization with annual contributions of $300,000 or more must file an audited financial statement prepared by an independent CPA. A charitable organization with annual contributions less than $300,000 and at least $100,000 must file a financial statement that is reviewed or audited by an independent CPA. A charitable organization with annual contributions less than $100,000 and at least $50,000 must have a compilation, review, or audit of its financial statements prepared by an independent CPA.

Rhode Island

Audit Required: Yes
Statute and Description:
R.I. Gen. Laws § 5-53.1-4 | All charitable organization are required to submit audited financial statements, but those with gross annual income of $500,000 or less  may meet the financial filing requirements by providing either an IRS Form 990, or financial statements for the immediately preceding fiscal year compiled by an independent public or certified accountant.

South Carolina

Audit Required: No state law requirement.
Statute and Description: S.C. Code Ann. § 33-56-30

South Dakota

Audit Required: No state law requirement.
Statute and Description: S.D. Codified Laws § 47-24-6

Tennessee

Audit Required: Yes
Statute and Description:
Tenn. Code Ann. § 48-101-506(b)(2) | A charitable organization with gross annual revenue over $500,000 must file an audited financial statement prepared by an independent CPA.

Texas

Audit Required: No state law requirement.
Statute and Description: Tex. Bus. & Org. Code § 22.352 | A charitable organization with annual contributions over $10,000 must have current and accurate financial records in accordance with GAAP. Based on these records, the board should prepare or approve a financial report that conforms to AICPA standards. The financial report must be made available to the public (§ 22.353(b)). Exemptions (§ 22.355).

Utah

Audit Required: No state law requirement.
Statute and Description: Utah Code § 16-6a-1607

Vermont

Audit Required: No state law requirement.
Statute and Description: Vt. Stat. Ann. tit. 11B, § 16.22

Virginia

Audit Required: Yes
Statute and Description:
Va. Code Ann. § 58.1-609.11(C)(4) | A nonprofit organization with gross annual revenue of $1 million or more may be required to provide an audited financial statement prepared by an independent CPA. A nonprofit entity with gross annual revenue less than $1 million and at least $750,000 must provide a financial review by an independent CPA.

Washington

Audit Required: Yes
Statute and Description:
  Wash. Rev. Code § 434-120- 107 | A charitable organization with an annual gross revenue exceeding $3 million over the three preceding, fiscal years must file an audited financial statement prepared by an independent CPA. NOTE: Disclosure Requirement: A charitable organization with annual gross revenue of less than $3 million and more than $1 million averaged over the three preceding, fiscal years must disclose to the public either an audited financial statement prepared by an independent CPA or a federal financial reporting form (e.g., IRS Form 990) prepared by an independent CPA.

West Virginia

Audit Required: Yes
Statute and Description:
W. Va. Code § 29-19-5(a)-(b) | Charitable organizations with annual contributions over $200,000 must file an audited financial statement prepared by an independent CPA. Charitable organizations with annual contributions of $200,000 or less and more than $100,000 must file a financial statement reviewed by an independent CPA.

Wisconsin

Audit Required: Yes
Statute and Description:
Wis. Stat. § 202.11| A charitable organization with annual contributions over $400,000 must file an audited financial statement prepared by an independent CPA.  A charitable organization with annual contributions less than $400,000 and over $200,000 must file a financial statement reviewed by an independent CPA.

Wyoming

Audit Required: No state law requirement.
Statute and Description: Wyo. Stat. § 17-19-1630

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