Charities
Financial statement audits, single audits, Form 990, and grant compliance support for 501(c)(3) public charities and the boards that oversee them.
Overview
Public charities depend on donors, grantors, and government agencies, and each of those funders expects transparent reporting. A 501(c)(3) organization needs financial statements that follow not-for-profit accounting standards, including proper treatment of contributions with and without donor restrictions. Organizations that spend federal award money above the threshold set by the Uniform Guidance must also undergo a single audit. Pease Bell works with public charities on audits, single audits, Form 990, and the grant compliance work that connects them.
Our audits of charities give boards, donors, and funding agencies independent assurance over the numbers, and our single audit work addresses the compliance requirements attached to federal programs. We prepare and review Form 990, the public return that donors and watchdog groups often read first. We also help finance teams account for pledges, conditional grants, and in-kind gifts, and build the records that grant reporting depends on.
How We Help Charities
Financial Statement Audits
Audits and reviews of public charity financial statements, with attention to net asset classification, contributions, functional expense allocation, and liquidity disclosures under not-for-profit accounting standards.
Single Audits
Single audits under the Uniform Guidance for organizations that expend federal awards above the required threshold, including testing of major programs, compliance requirements, and internal control over federal awards.
Form 990 Preparation
Preparation and review of Form 990 and related schedules, including governance, compensation, and program service information that donors, grantors, watchdog groups, and the public review.
Contribution Accounting
Help recording and accounting for pledges, conditional and unconditional grants, donor-restricted gifts, and contributed nonfinancial assets so revenue is recognized and presented correctly under ASC 958.
Grant Compliance
Support for tracking grant budgets, allowable costs, and reporting requirements across federal, state, and private funders so grant reports reconcile to your books and hold up when funders review them.
Internal Controls
Review of internal controls over cash receipts, disbursements, and grant spending, with practical recommendations sized for organizations with small finance teams and active volunteer boards.
Challenges We Help Charities Address
- ✓Deciding whether federal spending triggers a single audit
- ✓Classifying donor-restricted gifts and releases correctly
- ✓Separating conditional grants from unconditional contributions
- ✓Allocating shared costs across programs, management, and fundraising
- ✓Maintaining controls with a small finance staff
Frequently Asked Questions
When does a nonprofit need a single audit?
A single audit is generally required when a non-federal entity expends federal awards above the threshold set in the Uniform Guidance, 2 CFR Part 200, Subpart F, during its fiscal year. The threshold is based on federal expenditures, including pass-through funding, not on total revenue. Pease Bell can help you determine whether your organization meets the requirement.
What is the difference between a financial statement audit and a single audit?
A financial statement audit provides an opinion on whether your financial statements are fairly presented. A single audit includes that work and adds testing of compliance and internal control over federal programs, following Government Auditing Standards and the Uniform Guidance. The single audit results are filed with the Federal Audit Clearinghouse.
Do all 501(c)(3) charities file Form 990?
Most do, though the version depends on size. Smaller organizations may file Form 990-N or Form 990-EZ, while larger ones file the full Form 990. Churches and certain related organizations are generally exempt from filing. Because the return is public, it should be accurate and consistent with your financial statements.
How should a charity account for conditional grants?
Under ASC 958-605, a grant is conditional if it includes a barrier the organization must overcome and a right of return or release for the funder. Conditional contributions are recognized as revenue only when the conditions are met. Unconditional gifts are recognized when received or promised. We help charities review agreements and apply this guidance.
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