Florida state law regulates all business transactions within the state, and every organization must be familiar with its financial reporting requirements. All Florida nonprofit organizations must submit a detailed financial report on an annual basis if they receive any funding from the state. Further, scholarship-funding nonprofits and direct-support agencies are required to have an independent audit performed each year.
Nonstate Nonprofit Organizations
The Florida Single Audit Act contains special reporting requirements for nonstate nonprofit organizations that receive financial assistance from the state. A nonprofit organization is any business that is operated for scientific, educational, charitable or similar purposes in the public interest. No part of the income may be distributed to the nonprofit's directors or officers, apart from reasonable compensation for services rendered. "Nonstate entity" refers to any nonprofit organization that received financial assistance from the government.
Nonstate Nonprofit Audit Requirements
Nonstate nonprofits are required to have either a state single audit or a project-specific audit. If the nonprofit expends $500,000 or more of the state's financial assistance, the organization will compete a state single audit. A project-specific audit occurs when the state has financed a specific project of the nonprofit. In either case, the nonprofit must have an independent audit performed by a certified public accountant and submit a detailed financial report to the auditor general. State single audits are more detailed and require more supplemental information, such as a budgetary comparison schedule.
Nonprofit Scholarship-Funding Programs
Nonprofits that provide scholarship funding are required to have an audit completed annually by an independent certified public accountant. If the organization provides scholarships for students who attend any public or private schools in the state, and the organization accepts donations from the public, the audit rule applies. The audit must be submitted to the auditor general and the Department of Education. Additionally, scholarship funding programs must submit quarterly reports to the Department of Education with details about scholarship distributions.
Direct-Support and Citizen-Support Organizations
All Florida direct-support and citizen-support organizations with an annual budget over $100,000 must provide for an annual financial audit of its accounts. Direct-support organizations are those that provide support to government agencies. Citizen-support organizations are created to provide support and funding for Florida state parks. The audit must be completed by an independent certified public accountant, and the report must be submitted to the auditor general. However, organizations that provide support for the Department of Environmental Protection or the Department of Agriculture and Consumer Services with a budget under $300,000 are not required to have an independent audit.