Preparing for Grant Audits

Grant audit preparation for nonprofits usually breaks down when support lives across QuickBooks, spreadsheets, inbox threads, and shared drives. This guide covers how to get ready for single audits, funder reviews, and internal audit requests with cleaner documentation, reconciliations, and reporting.

Types of Grant Audits

Single Audit (Uniform Guidance)

Under 2 CFR 200.501, a non-Federal entity that expends $1,000,000 or more in Federal awards during its fiscal year must have a single or program-specific audit for that year. The $1,000,000 threshold applies to fiscal years beginning on or after October 1, 2024:

• Is an organization-wide audit that includes financial statements and federal awards; compliance testing focuses on major programs selected under Subpart F
• Tests internal controls
• Reviews compliance requirements
• Results in a public report

Funder Audits

Individual funders may audit their grants:

• Can be desk review or on-site
• Focus on their specific award
• May request detailed documentation

Internal Audits

Your organization's own review:

• Tests internal controls
• Identifies issues before external audits
• Continuous improvement focus

What Auditors Look For

Financial Documentation

• Transaction support (invoices, receipts)
• Allocation methodology
• Budget to actual comparison
• Bank reconciliations

Compliance Documentation

• Grant agreement
• Budget (original and modifications)
• Funder correspondence
• Approval documentation

Internal Controls

• Segregation of duties
• Approval processes
• Policy documentation
• Training records

Using GrantLink for Audit Prep

Generate Audit Reports

1. Go to Chats > New Chat
2. Ask the AI: "Generate an audit summary for [grant name]"
3. Review the comprehensive output
4. The generated report appears in the grant's Reports tab; review its evidence before relying on or exporting it

Transaction Detail

1. Go to the grant
2. Export all transactions
3. Include:
   • Date, vendor, amount
   • Account coding
   • Budget category
   • Allocation notes

Activity Log

Use available grant activity history and underlying QuickBooks Online records as complementary evidence. Confirm the requested population is complete; application history is not a substitute for invoices, approvals, payroll support, award terms, or the accounting ledger.

Pre-Audit Checklist

The timing below is an illustrative internal workback plan, not an auditing-standard deadline. Replace it with dates agreed with your auditor and funders.

Illustrative: 30 Days Before:

• Confirm audit scope and timing
• Review prior audit findings
• Gather grant agreements
• Prepare staff involved

Illustrative: 14 Days Before:

• Run GrantLink reports
• Reconcile bank statements
• Organize supporting documents
• Verify all allocations are complete

Illustrative: Day Before:

• Set up auditor workspace
• Prepare electronic file access
• Brief staff on procedures
• Have contact info ready

Common Audit Findings

Avoid these issues:

1. Missing documentation - Keep all receipts and invoices
2. Inconsistent allocation - Use methods consistently
3. Budget overruns - Monitor spending carefully
4. Late reporting - Submit on time
5. Improper costs - Know what's allowable

Best Practices

1. Audit continuously - Don't wait until year-end
2. Organize as you go - File documents promptly
3. Communicate early - Alert auditors to known issues
4. Learn from findings - Implement corrective actions
5. Reconcile GrantLink to QuickBooks Online - QuickBooks Online is the accounting source of truth; investigate differences and do not assume allocations changed QuickBooks Online

How GrantLink supports this today

GrantLink helps by organizing allocations backed by QuickBooks Online, budget lines, fund receipts, funding shares, documents, report outputs, and activity history. It supports audit preparation, but it does not replace funder guidance, accounting policy, or professional review.