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As charitable organizations grow, additional financial reporting responsibilities often follow. In Pennsylvania, one of the first major compliance milestones occurs when a charitable organization receives at least $250,000 but less than $750,000 in gross annual contributions during its fiscal year.

Under Pennsylvania’s Solicitation of Funds for Charitable Purposes Act and current Department of State guidance, organizations in this range generally must submit reviewed or audited financial statements. Organizations receiving $750,000 or more in gross annual contributions must submit audited financial statements. (Pennsylvania Department of State – BCO-10 Instructions).

Pennsylvania measures gross annual contributions on a national basis, not only contributions received from Pennsylvania residents. The current BCO-10 instructions explain how organizations should determine this amount from Form 990 or related reporting information. (Pennsylvania Department of State – BCO-10 Instructions).

Understanding these requirements before your renewal deadline can help your organization remain compliant while demonstrating financial transparency to donors, grantmakers, board members, and the public.

Whether your nonprofit serves Philadelphia, Pittsburgh, Allentown, Harrisburg, Erie, Lancaster, Scranton, or communities throughout Pennsylvania, planning ahead for your financial review can simplify the registration process and help avoid unnecessary delays.

Pennsylvania Financial Review Requirements at a Glance

Quick Answer

If your Pennsylvania charitable organization receives $250,000 to less than $750,000 in gross annual contributions, it generally must submit reviewed or audited financial statements as part of its registration filing. At $750,000 or more, audited financial statements are required. (Pennsylvania Department of State – BCO-10 Instructions).

When Is a Financial Review Required in Pennsylvania?

Pennsylvania bases the applicable financial-statement requirement on gross annual contributions. For organizations subject to registration, the current reporting tiers are: less than $100,000 may use internally prepared, compiled, reviewed, or audited statements; $100,000 to less than $250,000 may use compiled, reviewed, or audited statements; $250,000 to less than $750,000 must use reviewed or audited statements; and $750,000 or more must use audited statements. (Pennsylvania Department of State – BCO-10 Instructions).

These filings are administered by the Pennsylvania Department of State’s Bureau of Corporations and Charitable Organizations. The BCO-10 is used for charitable organization registration and renewal filings, subject to applicable exclusions and exemptions. (Pennsylvania Department of State – Registration Forms and Documents).

What Is a Financial Statement Review?

A financial statement review is an accounting engagement performed under the Statements on Standards for Accounting and Review Services (SSARS) issued by the AICPA. A review primarily consists of analytical procedures and inquiries and provides limited assurance that no material modifications are needed for the financial statements to conform with the applicable financial reporting framework. (AICPA Preparation, Compilation, and Review Standards).

A review is substantially narrower in scope than an audit. It does not include the same level of testing, confirmation, or internal-control procedures that would normally be associated with an audit.

For a Pennsylvania charitable organization in the review range, an independent CPA review can satisfy the state financial-statement requirement when the organization does not elect to provide an audit.

Pennsylvania Law at a Glance

Pennsylvania’s charitable solicitation framework requires organizations soliciting charitable contributions from Pennsylvania residents to register unless they qualify for an exclusion or exemption. The Bureau’s current guidance ties the required level of financial statements to gross annual contributions and identifies the BCO-10 as the principal charitable organization registration statement. (Pennsylvania Solicitation of Funds for Charitable Purposes Act).

A useful Pennsylvania-specific detail is that “gross annual contributions” are based on total national contributions from all sources for the organization’s preceding fiscal year, rather than only donations received inside Pennsylvania. (Pennsylvania Department of State – BCO-10 Instructions).

Financial Review vs. Financial Audit

Although both engagements are performed by independent Certified Public Accountants, they provide different levels of assurance.

Financial Review

A financial review generally includes:

• Analytical procedures
• Inquiries of management
• Limited assurance
• Lower overall cost than an audit
• Generally required for organizations receiving at least $250,000 but less than $750,000 in annual contributions (Pennsylvania Department of State – BCO-10 Instructions).

Financial Audit

A financial audit generally includes:

• Detailed testing of financial records
• Confirmation procedures
• Evaluation of internal controls
• Reasonable assurance
• Generally required once annual contributions reach $750,000 or more (Pennsylvania Department of State – BCO-10 Instructions).

Preparing for Your Financial Review

Maintaining organized financial records throughout the year can significantly streamline your review engagement.

Your CPA will commonly request:

• Statement of Financial Position
• Statement of Activities
• General ledger
• Trial balance
• Bank reconciliations
• Contribution records
• Grant documentation
• Board meeting minutes
• Investment schedules
• Significant contracts
• IRS Form 990
• Information needed to complete Form BCO-10

Preparing these documents before the engagement begins can reduce delays and help ensure your annual registration is completed on time.

Benefits Beyond Compliance

Although Pennsylvania requires reviewed financial statements once the statutory threshold has been met, many organizations also realize additional benefits, including:

• Increased donor confidence
• Greater financial transparency
• Stronger grant applications
• Enhanced board oversight
• Improved accounting processes
• Increased organizational credibility

Why Choose ELT CPA LLC?

ELT CPA LLC provides independent financial statement review services for charitable organizations throughout Pennsylvania.

Our team understands nonprofit financial reporting requirements and works closely with charitable organizations of all sizes to complete review engagements efficiently while minimizing disruption to day-to-day operations.

Our services include:

• Independent financial statement reviews
• Nonprofit accounting guidance
• GAAP financial statement assistance
• Annual reporting support
• Remote service throughout Pennsylvania
• Responsive communication throughout the engagement

Whether your organization is preparing for its first financial review or has completed reviews previously, ELT CPA LLC is ready to help.

Frequently Asked Questions

What triggers a financial review in Pennsylvania?

Pennsylvania generally requires charitable organizations receiving at least $250,000 but less than $750,000 in annual contributions to submit reviewed financial statements prepared by an independent CPA with their annual registration (Pennsylvania Department of State – BCO-10 Instructions).

Does Pennsylvania use revenue or contributions?

Pennsylvania bases its reporting requirements on annual contributions, not total revenue (Pennsylvania Department of State – BCO-10 Instructions).

What is Form BCO-10?

BCO-10 is Pennsylvania’s Charitable Organization Registration Statement. The Bureau currently accepts it for charitable organization registration and renewal filings. (Pennsylvania Department of State – Registration Forms and Documents).

When is an audit required?

Organizations receiving $750,000 or more in annual contributions generally must submit audited financial statements (Pennsylvania Department of State – BCO-10 Instructions).