Does My Charity Need an Audit or a Financial Review? ACNC Size Thresholds Explained
Last updated: 25 October 2026.
Treasurers, boards and managers of charities regularly ask: “Do we actually need an audit?” The ACNC answer depends on your charity’s size, measured by annual revenue. But the ACNC is also clear that other regulators, funders or your own constitution may require more than the ACNC does, so the size test is the start of the answer, not the end.
This guide explains the rules (checked against ACNC guidance on 25 October 2026), the difference between a review and an audit, who can do them, and how to prepare. It is general information, not legal advice. Reviews and audits are carried out by independent, appropriately registered or qualified professionals, not by us. Our role is the bookkeeping and preparation that makes the process smoother.
The short version: small charities (revenue under A$500,000) have no ACNC requirement for a review or audit. Medium charities (A$500,000 to under A$3 million) must have their financial report reviewed or audited. Large charities (A$3 million or more) must have it audited. Always check your governing document and funding agreements too.
Step 1: Work out your ACNC size
The ACNC bases a charity’s size on its annual revenue for the reporting period. For reporting periods from the 2022 Annual Information Statement (AIS) onwards:
| Size | Annual revenue | Annual financial report to the ACNC | Review or audit required by the ACNC |
|---|---|---|---|
| Small | Under A$500,000 | Optional (encouraged) | No ACNC requirement |
| Medium | A$500,000 to under A$3 million | Required | Review or audit |
| Large | A$3 million or more | Required | Audit |
Three details trip charities up:
- Revenue, not total income, defines size. The ACNC describes revenue as a component of total income, and gives the formula Revenue + Other Income = Total Income. Where a figure sits near a threshold, confirm exactly what counts.
- A one-off spike can push you up a size. If a large bequest or similar one-off event lifts you into a larger size for a single reporting period, you can apply to have your former size recognised using Form 4D, before you complete the AIS. You cannot do this in consecutive years.
- Exceptions exist. Basic Religious Charities and charities covered by transitional reporting arrangements (for example, ORIC-registered charities, which report to ORIC) have different arrangements.
Step 2: Check other requirements
The ACNC says that its rules are only its own requirements for financial reports, and that there may be specific requirements from other regulators, agencies or a charity’s own governing document. Its size guidance also states that a charity’s governing document or grant funding agreements may require a review or audit. In practice, check:
- Your constitution or rules. A small charity whose governing document requires financial statements must prepare them, and many constitutions require an annual audit or review.
- Grant and funding agreements. Funders often require audited acquittals above a certain grant size. See our grant acquittal guide.
- State and territory regulators. If your organisation is, for example, an incorporated association, or holds a fundraising authority, state-based rules may apply. We have not covered state rules in this article, so confirm them with the relevant regulator. See also our post on NSW charity fundraising changes.
- Banks, lenders and major donors. They may ask for reviewed or audited statements.
Review versus audit: what is the difference?
| Review | Audit | |
|---|---|---|
| Assurance | Limited. The reviewer states whether anything has come to their attention suggesting the report does not meet ACNC Act requirements. | Reasonable assurance. A direct, positively stated opinion on whether the report meets ACNC requirements, gives a true and fair view and meets Australian Accounting Standards. |
| Depth | Less detailed. Includes inquiry with staff and responsible finance people. | More detailed. The auditor collects evidence and performs additional procedures. |
| Cost and time (ACNC’s guide) | Generally cheaper, takes less time, and easier to find a reviewer (especially in regional areas). | Can cost more, take more time and be harder to find an auditor. |
| Who can do it | For medium charities: a registered company auditor, an audit firm, an authorised audit company, or a current member of a relevant professional body who is qualified to undertake a review. | A registered company auditor, an audit firm or an authorised audit company. |
The ACNC adds that the reviewer or auditor must give your charity a signed written independence declaration, and that you should make sure they are independent of your organisation. That is why the people who prepare your day-to-day accounts should not also be your auditor or reviewer.
What the ACNC wants in the financial report
Medium and large charities (except Basic Religious Charities) must provide, as a minimum: a statement of profit or loss and other comprehensive income, a statement of financial position, a statement of changes in equity, a statement of cash flows, notes to the financial statements, a signed and dated Responsible People’s declaration, and the signed reviewer’s or auditor’s report. Whether you prepare general purpose or special purpose statements depends on whether you are a “reporting entity”; the ACNC publishes guidance for that decision. See our guide to ACNC financial reporting basics.
Medium and large charities must use accrual accounting. Small charities may use cash or accrual.
Could a modified report happen?
If your financial report fully complies, the review or audit report is “unmodified”. The ACNC explains that a report can be qualified, disclaimed or adverse if the reviewer or auditor finds material misstatements, or cannot get enough evidence. Poor records are a common reason for a limited-evidence problem, so good bookkeeping is the best insurance. The ACNC’s example of a qualified opinion is cash donations where it is impracticable to have effective controls before they are recorded. See our guide to internal controls for NFPs.
Timing
The AIS and the financial report must be submitted within six months of the end of your reporting period. For charities reporting to a standard 1 July to 30 June year, the 2026 AIS would normally be due 31 December, but the ACNC has stated that the Commissioner extended the deadline for the 2026 AIS to 31 January 2027. Check the date for your charity on the ACNC Charity Register. If reviews or audits run late, contact the ACNC before the due date: extension requests are considered case by case.
Small charity: should we get a review anyway?
There is no ACNC obligation, but the ACNC encourages small charities to submit a financial report. A voluntary review can still add credibility with funders and members. Weigh the cost against the benefit, and check your funding agreements first.
How to prepare (and keep the cost down)
- Appoint early. The ACNC suggests starting early, asking other charities for recommendations, checking qualifications and independence, and making sure you get value for money.
- Fix known problems before they arrive. The ACNC advises recording accounting problems you already know about and fixing them, or writing a plan.
- Ask for a schedule. Get a list of what the reviewer or auditor needs and when.
- Have the books reconciled. Bank accounts, grants and restricted funds should reconcile to supporting documents. See our fund accounting chart of accounts guide.
- Use the findings. The ACNC says it is common for reviewers and auditors to suggest improvements. Make a plan and share it.
Our audit and review preparation checklist goes into more detail.
How we help
We provide bookkeeping, grant tracking, board reporting and annual-reporting preparation for Sydney charities and not-for-profits. We do not perform audits or reviews, which must be done by independent registered or qualified professionals. We get your books, reconciliations and schedules ready and coordinate with your reviewer or auditor. Try our free Charity Health Check, read about our support for charities and NFPs, or email info@guidancegrowth.com.au.
Frequently asked questions
Does my small charity need an audit?
The ACNC does not require a review or audit for small charities (annual revenue under A$500,000). However, your governing document, funders or other regulators may require one, so check those.
Does a medium charity need an audit or a review?
A medium charity (A$500,000 to under A$3 million revenue) must have its financial report either reviewed or audited, and the reviewer’s or auditor’s report must be submitted with the Annual Information Statement.
Does a large charity have to be audited?
Yes. A charity with annual revenue of A$3 million or more must have its financial report audited by a registered company auditor, an audit firm or an authorised audit company.
What is the difference between a review and an audit?
A review gives limited assurance and is less detailed. An audit gives reasonable assurance through more evidence and procedures. The ACNC says a review is generally cheaper and quicker, but provides a lower level of assurance.
Can my bookkeeper also be my auditor or reviewer?
No. The ACNC requires a signed independence declaration and advises that the reviewer or auditor be independent of the charity, so the person preparing your records should not review or audit them.
What if a one-off bequest pushes us into a larger size?
You can apply on Form 4D to have your former size recognised for a single reporting period, before completing the AIS. You cannot apply in consecutive years.
Sources and further reading
- ACNC: Charity size and reporting thresholds (checked 25 October 2026)
- ACNC: Reviewing and auditing financial reports (checked 25 October 2026)
- ACNC: Review and audit practical tips (checked 25 October 2026)
- ACNC: Annual financial reports (checked 25 October 2026)
- ACNC: Annual Information Statement due dates (checked 25 October 2026)
- ACNC: Apply to keep charity size (checked 25 October 2026)
- ACNC: Transitional reporting arrangements (checked 25 October 2026)
This article is general information, not personal advice. Rules and dates can change, so check ato.gov.au or acnc.gov.au for the latest, or speak to us about your situation.