Forming audit committees is becoming a more common practice in the nonprofit sector, offering an unbiased outlet to monitor the financial health of an organization. Appointed by the board of directors as part of its fiduciary duty to the nonprofit, audit committees ensure that the leadership team is effectively following internal and external auditing protocols, and that the organization’s financial reporting practices are objectively reviewed on a regular basis.

Recently, increased pressures from regulatory bodies and increased public scrutiny have created an even greater need for such oversight, safeguarding the nonprofit from fraudulent or reputation-damaging activity. With so much at stake, it’s important for organizations to remember that simply creating an audit committee is not enough. Proper measures must be taken to make sure the committee is maintaining its effectiveness, and more importantly, its core responsibilities to the organization. The following article will explore how to appoint, integrate and monitor a well-rounded nonprofit audit committee.

Understanding the Responsibilities of an Audit Committee

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