January 15, 2013

Church Audit Required?

Question: 

When is it necessary for churches to have their accounts externally audited by CPAs? Is that up to the church or is there some regulation that requires one?

Answer:
Generally, churches are not required by law to secure a periodic or annual audit opinion by an independent CPA firm. However, it may be within the church’s best interests to do so. Typically, larger churches are more able to incur the cost of an audit.

Further, many churches that are members of the Evangelical Council for Financial Accountability (www.ECFA.org) are required to secure annual independent audits.

Keep in mind that a church’s governing documents, or a bank from which a church has acquired a loan may require a church to secure an audit opinion.

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