Washington (July 7, 2004) -- Approximately three-quarters (77 percent) of nonprofit organizations have an audit committee, based on findings reported in the latest Grant Thornton "National Board Governance Survey for Not-for-Profit Organizations."
However, the report pointed out, "While that number may seem high, not-for-profit industry experts believe that almost all boards of directors should have a separate audit committee."
As the report noted, the Sarbanes-Oxley Act requires that public companies report whether or not their audit committee includes a financial expert. Even though NFPs are not legally bound to this standard, 75 percent of survey respondents said that their audit committee does include a financial expert.
"An audit committee is a critical step in establishing board-level responsibility and accountability for quality financial reporting and effective internal control," commented Frank Kurre, Grant Thornton partner-in-charge of the Northeast higher education and NFP industry practice. "It also builds confidence among an organization's stakeholders in the financial stewardship exercised by the board."
The survey included responses from more than 300 NFP officials in 38 states and the District of Columbia.
— WebCPA Staff
