N.J. Admin. Code § 13:48-5.3

Current through Register Vol. 56, No. 8, April 15, 2024

Section 13:48-5.3 - Financial reports; audits

(a) A charitable organization filing a long form registration shall file an annual financial report with the Attorney General.

(b) Information required for the financial report shall include the following:

1. A statement of financial position;

2. A statement of activities, revenue, gains and other support, expenses and losses and changes in net assets;

3. A statement of functional expenses classified into:

i. Program expenses;

ii. Management and general expenses; and

iii. Fund raising; and

4. A statement of cash flows.

(c) The annual financial report of every charitable organization that received more than $ 500,000 in gross revenue during its most recently completed fiscal year shall be accompanied by:

1. A financial statement prepared in accordance with generally accepted accounting principles or other comprehensive basis of accounting principles consisting of the modified cash basis or regulatory basis, which has been audited in accordance with generally accepted auditing standards by an independent certified public accountant licensed by the jurisdiction in which he or she practices; and

2. All management letters prepared by the auditor in connection with the audit commenting on the internal accounting controls or management practices of the charitable organization.

(d) The annual financial reports of all charitable organizations that receive more than $ 25,000 but less than $ 500,000, shall be certified by the charitable organization's president or other authorized officer of the organization's governing board. If the Attorney General requests an audit, the charitable organization shall be notified in writing. In response, the charitable organization shall, within 120 days of the Attorney General's notification, submit:

1. A financial statement prepared in accordance with generally accepted accounting principles or other comprehensive basis of accounting principles consisting of the modified cash basis or regulatory basis, which has been audited in accordance with generally accepted auditing standards by an independent certified public accountant licensed by the jurisdiction in which he or she practices; and

2. All management letters prepared by the auditor in connection with the audit commenting on the internal accounting controls or management practices of the charitable organization.

(e) For the purpose of determining if an audit is required pursuant to (c) above, a charitable organization's gross revenue shall not include one-time bequests, fund raising campaigns for capital property in a single fiscal year, the value of services performed by volunteers, or items purchased by other entities for the use of the charitable organization where ownership of the item is retained by the original purchaser.

(f) An independent member agency of a federated fund raising organization shall independently comply with the provisions of this section.

(g) The Attorney General will accept a copy of a current audit performed for a State agency such as the New Jersey Department of Community Affairs or the New Jersey Department of Education, an A-133 audit performed for the United States government, or an audit performed for another state agency or officer in compliance with the laws of that state, provided that the audit is substantially similar in content and scope to the audit required by this section.

N.J. Admin. Code § 13:48-5.3

Amended by 51 N.J.R. 637(a), effective 5/6/2019

Amended by 54 N.J.R. 782(a), effective 5/2/2022