When does my charity need an audited financial statement?

What counts toward the threshold

The costly mix-up: states don't measure the same figure. Some set the threshold on total contributions, some on gross revenue, and a few on total expenses. An organization can be over the line in one state and under it in another on the same 990 — which is why the table names the metric for each state, and why it's worth checking against your own figures rather than a single headline number.

Plan ahead — crossing a threshold isn't instant

An audit takes weeks, and an auditor has to be engaged months in advance. A charity approaching a threshold plans for the engagement and its cost rather than discovering the requirement at filing time. Watching your revenue against every state's threshold is exactly the kind of thing that's easy to miss by hand and easy for Monitor to catch.

States with no audit requirement to register

18states that require registration carry no financial-statement threshold on their card — registration doesn't turn on an audit there. (This is separate from any audit your own bylaws, grantmakers, or the IRS may call for.)

Common questions

Which states require a nonprofit to have an audit to register?

Around twenty states require audited or reviewed financial statements above a revenue threshold as part of charitable registration. The threshold varies widely — roughly $300,000 to $3,000,000 — and some states step through a compilation, then a review, then a full audit as revenue rises. The table on this page lists every threshold and links each to the statute.

What revenue counts toward the audit threshold?

It differs by state, and getting it wrong is a common and costly mistake. Some states measure the threshold on total contributions, others on gross revenue, and a few on total expenses — so the same organization can be over the line in one state and under it in another. Each state's metric is shown in the table and cited on its guide.

When should we engage an auditor?

Well before you cross the threshold. An audit takes weeks and an auditor has to be engaged months ahead, so an organization approaching a threshold plans for it rather than discovering it at filing time. Watching your figures against every state's threshold is exactly what Monitor does.