An effective audit committee can be your not-for-profit organization’s best friend, safeguarding its most valuable asset: its reputation. Audit committees are tasked with providing experience, oversight and direction. Well-run committees ensure that management implements and follows an effective system of internal controls, and that outside auditors objectively assess the organization’s financial reporting practices. Through these and related efforts, audit committees strengthen their organizations by protecting their integrity, financial health and long-term viability.
As not-for-profits face increased scrutiny – from the IRS; local, state and federal government; and from donors – the pressure on today’s audit committees is extraordinary. Each member understands it is his or her responsibility not only to prepare accurate financial statements, demonstrate responsible financial management, maintain regulatory compliance and manage operating risks, but to protect the very essence of the organization.
