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As charitable organizations expand across Kansas, increased fundraising often brings additional financial reporting responsibilities. State law requires larger nonprofits to provide greater financial transparency through independently audited financial statements, helping donors, regulators, and the public maintain confidence in charitable organizations.

If your nonprofit receives contributions in excess of $500,000 during its most recently completed fiscal year, Kansas law requires an audited financial statement prepared in accordance with generally accepted accounting principles, together with the opinion of an independent certified public accountant. The filing is made with the Kansas Attorney General as part of the charitable organization registration process. (K.S.A. 17-1763(c); Kansas Attorney General, Charitable Organization Registration)

Unlike states that measure total revenue or assets, Kansas focuses specifically on the amount of charitable contributions received during the fiscal year. Organizations experiencing rapid fundraising growth should monitor contribution totals throughout the year so they can begin audit planning before their annual registration deadline.

Whether your nonprofit serves Wichita, Overland Park, Kansas City, Topeka, Lawrence, Manhattan, Salina, or communities throughout Kansas, understanding the audit requirements early can make the compliance process significantly more manageable.

Kansas Audit Requirements at a Glance

Quick Answer

If your Kansas charitable organization receives contributions in excess of $500,000 during its most recently completed fiscal year, it must file an audited financial statement and the opinion of an independent CPA in addition to the other financial information required with registration. (K.S.A. 17-1763(c))

When Does Kansas Require a Nonprofit Audit?

Kansas bases this audit requirement on the amount of contributions received during the organization’s most recently completed fiscal year. (K.S.A. 17-1763(c))

Once contributions exceed $500,000, the organization must obtain an audited financial statement prepared in accordance with GAAP and include the opinion of an independent CPA. (K.S.A. 17-1763(c))

Kansas establishes a statutory audit trigger based on contribution activity. This makes it especially important for organizations experiencing significant fundraising growth to evaluate contribution totals before preparing their registration filing. (K.S.A. 17-1763(c))

Organizations that anticipate crossing the threshold should engage an auditor early enough to allow for planning, fieldwork, and completion before the applicable filing deadline. (AICPA, Statements on Auditing Standards)

How Kansas Measures the Audit Threshold

Kansas law measures the audit threshold using contributions received, rather than total organizational revenue. (K.S.A. 17-1763(c))

Many nonprofits generate revenue from sources such as:

• Program service fees
• Membership dues
• Investment income
• Rental income
• Other operating activities

These revenue streams are not the figure used in K.S.A. 17-1763(c) to determine whether the statutory audit threshold has been crossed. Organizations with multiple funding sources should therefore track contributions separately from other forms of revenue when evaluating the requirement.

For organizations with diverse funding sources, distinguishing charitable contributions from other revenue is an important part of determining whether an audit is required.

Kansas Law at a Glance

The Kansas Attorney General administers charitable organization registration under the Kansas Charitable Organizations and Solicitations Act. (Kansas Attorney General, Charitable Organization Registration; K.S.A. 17-1763(a))

Kansas registration materials require charitable organizations to provide financial information, and organizations exceeding the statutory threshold must include audited financial statements prepared by an independent CPA. (Kansas Attorney General, Charitable Organization Registration; K.S.A. 17-1763(b)-(c))

Because fundraising results can fluctuate significantly from year to year, nonprofits should evaluate contribution totals annually rather than assuming prior-year reporting requirements will remain the same.

Preparing for a Kansas Nonprofit Audit

Preparing early often results in a smoother audit and fewer delays during the annual registration process.

Your CPA will typically request:

• General ledger
• Trial balance
• Contribution schedules
• Major donor listings
• Grant agreements
• Bank reconciliations
• Board meeting minutes
• Investment statements
• Fixed asset schedules
• Internal control documentation
• IRS Form 990
• Prior-year financial statements

Maintaining complete documentation throughout the year can reduce follow-up requests and help the audit progress more efficiently.

Common Reasons Kansas Nonprofits Reach the Audit Threshold

Many organizations exceed Kansas’ audit threshold because of successful fundraising initiatives rather than gradual operational growth.

Examples include:

• Capital campaigns
• Major gifts from individual donors
• Community fundraising drives
• Matching gift campaigns
• End-of-year giving efforts
• Significant foundation awards

Reviewing contribution totals periodically throughout the fiscal year allows nonprofit leadership to prepare for an audit before annual filing deadlines become critical.

Benefits Beyond Compliance

Although Kansas law requires an audit once the statutory contribution threshold is exceeded, an independent audit can also provide broader organizational value. Audits of nonissuer financial statements are performed under applicable AICPA auditing standards. (K.S.A. 17-1763(c); AICPA, Statements on Auditing Standards)

A financial statement audit can help your nonprofit:

• Demonstrate accountability to donors
• Improve board oversight
• Strengthen internal financial controls
• Enhance grant competitiveness
• Improve financial reporting processes
• Increase organizational transparency
• Build confidence with lenders and funding partners

For many growing nonprofits, these advantages extend well beyond meeting state filing requirements.

Why Choose ELT CPA LLC?

ELT CPA LLC provides independent nonprofit financial statement audit services for charitable organizations throughout Kansas.

Our professionals understand nonprofit accounting standards, charitable reporting requirements, and the expectations of the Kansas Attorney General’s Office. We work closely with nonprofit leadership to complete efficient audit engagements while minimizing disruption to day-to-day operations.

Whether your organization is preparing for its first required audit or has undergone audits for many years, ELT CPA LLC can help you navigate Kansas’ nonprofit reporting requirements with confidence.

Frequently Asked Questions

Does Kansas use contributions or total revenue?

Kansas bases the statutory audit threshold on contributions received during the organization’s most recently completed fiscal year, not total organizational revenue. (K.S.A. 17-1763(c))

What types of fundraising count toward the threshold?

Charitable contributions from individuals, businesses, foundations, and other donors generally count toward the statutory threshold. Organizations should review the applicable law and consult their CPA if questions arise about specific funding sources.

Who regulates charitable organizations in Kansas?

The Kansas Attorney General administers charitable organization registration and related financial reporting requirements under the Kansas Charitable Organizations and Solicitations Act. (Kansas Attorney General, Charitable Organization Registration)

When should we begin preparing for our first audit?

Organizations expecting contributions to exceed $500,000 should begin working with an independent CPA well before the filing deadline so there is adequate time for audit planning and completion. (K.S.A. 17-1763(c); AICPA, Statements on Auditing Standards)