When Does a Canadian Charity Need an Audit?

Three different sources can require an audit of a Canadian charity: the incorporation statute, the bylaws, and any funder.

Federal — CNCA

Federally incorporated not-for-profits under the Canada Not-for-profit Corporations Act are categorized as soliciting or non-soliciting. A corporation that receives more than $10,000 in specified public-source income during a financial year generally becomes soliciting at the next annual meeting and remains so until the third following annual meeting. For a soliciting corporation:

• Over $250,000: audit required.
• More than $50,000 through $250,000: audit is the default; members may require a review engagement instead by special resolution.
• $50,000 or less: review engagement is the default; all members may consent to dispense with appointing a public accountant.

Non-soliciting corporations use different prescribed thresholds, including a $1 million designated-corporation boundary. Confirm the corporation’s status and the resolution passed for the relevant year rather than relying on its current funding mix alone.

Ontario — ONCA

The Ontario Not-for-Profit Corporations Act (proclaimed October 19, 2021) distinguishes public benefit corporations (PBCs) — which include charities — from non-PBCs.

For public benefit corporations:

• Audit generally required: annual revenue $500,000 or more.
• Review engagement allowed instead of audit: annual revenue more than $100,000 and less than $500,000, if members pass the required extraordinary resolution.
• Members may dispense with both audit and review: annual revenue $100,000 or less, if members pass the required extraordinary resolution.

ONCA also allows the bylaws to set higher requirements.

Alberta — Societies Act

The Alberta Societies Act uses an auditor model and permits the members to appoint two persons or a firm at the annual meeting. That statutory use of “auditor” does not by itself establish that every Alberta society must obtain a CPA audit performed under Canadian Auditing Standards. The society must read the Act together with its bylaws, funding terms, and any other applicable reporting requirement.

Other provinces — check the province’s own law

The rules are not interchangeable:

• British Columbia: the Societies Act requires financial statements at the annual general meeting and refers to an auditor’s report “if any”; it does not impose a general automatic revenue threshold for all societies.
• Saskatchewan: use The Non-profit Corporations Act, 2022. It contains its own designated-corporation, public-accountant, audit, review, and member-resolution mechanics; older summaries of the former Act should not be used.
• Newfoundland and Labrador: not-for-profit bodies corporate are addressed in Part XXI of the provincial Corporations Act, not Part II.
• Manitoba, Nova Scotia, New Brunswick and Prince Edward Island: check the current provincial statute, regulations, bylaws, resolutions, and funding terms. This page does not apply a federal or Ontario threshold to those provinces.

Quebec — OBNL

Many Quebec non-share-capital corporations are constituted under Part III of the Companies Act. The applicable financial-review requirement depends on the entity’s statute and governing documents as well as member decisions and funding terms; a single Canada-wide revenue threshold should not be inferred.

Funders override statute

A funder agreement can require an audit even when the incorporation statute does not. A $50,000 federal grant might come with a clause requiring an audited use-of-funds report. A multi-year foundation grant might require annual audited financial statements as a condition of continued funding. Always check funder agreements before assuming statutory thresholds are the binding constraint.

See also

• The audit prep service page explains how we prepare your file for an independent auditor.