Governor Wolf Raises Thresholds for Nonprofit Audits

Photo by Kumar Appaiah used with permissions from Creative Commons.

On December 22, 2017, Governor Wolf signed two bills into law.  Both Acts amend the Solicitation of Funds for Charitable Purposes Act to affect several important Bureau processes.  Both Acts become effective 60 days from the date they are signed by the Governor, which is February 20, 2018.  

Act 71 (HB 1420) amends the Charities Act to raise the thresholds for an audit, review or compilation of the financial reports required to be submitted by charitable organizations that are registered under the Charities Act. An audit of the financial records of a registered charitable organization by an independent certified public accountant or public accountant is not required until the gross annual contributions meet or exceed $750,000 (audit threshold was previously $300,000). Charitable organizations which receive annual contributions of at least $250,000, but less than $750,000, will be required to have a review or audit of their financial statements performed by an independent certified public accountant or public accountant. Lastly, charitable organizations which receive annual contributions of at least $100,000, but less than $250,000, are required to have a compilation, review or audit of their financial statements performed by an independent certified public accountant or public accountant. A compilation, audit or review is optional for any charitable organization which receives annual contributions of less than $100,000.

Act 72 (HB 1421) clarifies that annual registration statements for charitable organizations must be refiled annually based on the postmark date instead of the date received at the Bureau.

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