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Template · Governance

Audit committee charter

A charter for a board audit committee: who can serve, its duties before and after the audit, and reporting, with California and New York rules as examples.

Download for Word (.docx)Rich Text (.rtf)Plain text (.txt)

Three editable formats: Word (.docx), Rich Text (.rtf) and plain text (.txt). Reviewed October 21, 2026.

How to use this template

  1. Download it as a Word file (.docx), which opens in Microsoft Word, Google Docs, Pages and LibreOffice, or as Rich Text (.rtf) or plain text (.txt). All three are editable.
  2. Fill in every blank. Blanks are in square brackets, like [ORGANIZATION NAME], and are highlighted in the preview below. Delete any bracketed notes you don't need.
  3. Make it yours. Check it against your bylaws and your state's rules, and change anything that doesn't fit. Have your board approve it where it says so.
  4. Printing? Print this page: the printout leaves out the site's menus and shows the template with lines for the blanks.

An audit committee is a small group, usually of board members, that oversees the charity's yearly audit and the honesty of its financial reporting. It hires the auditor, talks with them before and after the audit, and tells the board what it learned. Some states require one once a charity reaches a certain size, and a charity can set one up even where it isn't required. This charter sets out who serves, what the committee does and how it reports.

If you don't yet know whether you need an audit, a review or neither, read our guide to audits and reviews first.

When state law requires it

The rules vary by state, so check yours. Two examples:

California. The Attorney General's summary of the Nonprofit Integrity Act says charitable corporations that must register with the Attorney General and have gross revenue of $2 million or more in a fiscal year must have audited financial statements and "must establish and maintain an audit committee." The $2 million threshold leaves out government grants if the charity must account for how it used them. The summary also says:

  • the committee may include people who aren't board members;
  • it can't include staff members, the president or chief executive officer, or the treasurer or chief financial officer;
  • finance committee members may serve but can't make up 50 percent or more of it, and the audit committee chair can't be a finance committee member;
  • under the board's supervision, it recommends hiring and firing the auditor and may negotiate the auditor's pay; and
  • it must confer with the auditor, review the audit and decide whether to accept it, and approve any non-audit services by the audit firm.

New York. Section 712-a of the Not-for-Profit Corporation Law applies to charities that must file an independent CPA's audit report with the Attorney General. The board, or an audit committee made up only of independent directors, oversees the accounting and financial reporting and the audit. It retains or renews the auditor each year and reviews the results and any management letter with the auditor. Charities with annual revenue over $1 million have more duties: reviewing the audit's scope and planning beforehand; discussing afterward any material risks and weaknesses in internal controls, any limits on the auditor's work, any significant disagreements with management, and whether accounting processes are adequate; considering the auditor's performance and independence each year; and, if a committee does this work, reporting to the board. Only independent directors may take part in the deliberations and votes.

How to adapt it

  • Pick the version that fits. Keep the duties your state requires, and add the rest as good practice if you like.
  • Define "independent" the way your state does, or in your conflict of interest policy. Form 990, Part VI also asks how many voting board members are independent.
  • Keep it small, for example three members, so it's easy to meet. At least one should be comfortable reading financial statements. Outside members can help if your state allows them.
  • Meet when it matters: before the audit starts, when the draft is ready, and once more in the year to review controls.
  • Approve the charter as a board resolution and review it every year.

Preview

Audit committee charter: [ORGANIZATION NAME]

Approved by the board on: [DATE]

Next review: [DATE]

1. Purpose

The audit committee helps the board oversee [ORGANIZATION NAME]'s financial reporting, internal controls and independent audit, so that the board, donors, funders and regulators can rely on its financial statements.

2. Members

  1. The committee has [NUMBER] members, appointed by the board each year at [MEETING].
  2. Members are [INDEPENDENT DIRECTORS / DIRECTORS AND OTHER PEOPLE THE BOARD APPOINTS, IF STATE LAW ALLOWS], as defined in [OUR CONFLICT OF INTEREST POLICY / STATE LAW].
  3. The following may not serve: staff members; the [PRESIDENT OR CHIEF EXECUTIVE]; the [TREASURER OR CHIEF FINANCIAL OFFICER]; [ANY OTHERS YOUR STATE OR BOARD EXCLUDES].
  4. Members of the finance committee may serve but may not make up [HALF OR MORE] of the committee, and may not chair it. [KEEP OR ADJUST TO MATCH YOUR STATE.]
  5. At least one member should have experience reading financial statements.
  6. The board names the chair: [NAME OR ROLE].

3. Meetings

  1. The committee meets at least [NUMBER] times a year, including before the audit begins and when the draft audit is ready.
  2. A quorum is [NUMBER] members. Only members who meet the independence requirements take part in deliberations and votes on audit matters; others may give background information or answer questions first.
  3. The committee meets with the auditor at least once a year without staff present.
  4. Minutes are kept and shared with the board.

4. Duties: the auditor

  1. Recommend to the board the hiring, renewal or replacement of the independent auditor, and negotiate the auditor's fee for the board's approval.
  2. Approve in advance any non-audit services by the audit firm, and check they don't affect its independence.
  3. Each year, consider the auditor's performance and independence.

5. Duties: before the audit

  1. Review the audit's scope, timetable and planning with the auditor.
  2. Confirm that staff will give the auditor full access to records and people.

6. Duties: after the audit

  1. Review the draft audited financial statements and any management letter with the auditor.
  2. Discuss with the auditor any material risks or weaknesses in internal controls, any limits placed on the auditor's work or access to information, any significant disagreements between the auditor and management, and whether the accounting and financial reporting processes are adequate.
  3. Decide whether to accept the audit and recommend it to the board.
  4. Agree with management on responses to the management letter, with owners and dates, and follow up on them.

7. Other duties

  1. Review the charity's internal controls at least once a year, for example the steps in our financial controls guide.
  2. Receive and oversee concerns raised under the whistleblower policy about accounting, controls or audit matters.
  3. Check that required filings that depend on the audit, such as state charity reports and the Form 990, are filed on time.
  4. [ANY OTHER DUTIES THE BOARD ASSIGNS]

8. Reporting to the board

After each meeting, the chair reports to the board on the committee's work, its recommendations and any concerns. The committee's minutes are part of the board's records.

9. Authority and resources

The committee may ask any officer, staff member or the auditor for information, and may get independent advice at the charity's expense up to $[AMOUNT] without further board approval.

10. Review of this charter

The committee reviews this charter every year and recommends any changes to the board.

Date reviewedChangesApproved by
[DATE][CHANGES, OR "NONE"][NAME]

Template from Golden Hint: goldenhint.org/resources/templates/audit-committee-charter. Reviewed October 21, 2026. General information, not legal or tax advice.

General information. Not legal, tax or financial advice. Rules change and every situation is different, so check the official sources and talk to a qualified professional before you act. More about this.

Keep going

Sources

Checked on October 21, 2026. Rules and fees change, so follow the links for the current version.

  1. California Attorney General, Registry of Charitable Trusts: Audit Requirements under the Nonprofit Integrity Act (summary of Government Code section 12586(e))
  2. New York State Senate: Not-for-Profit Corporation Law section 712-a, Audit oversight

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