How to Write a Nonprofit Audit RFP

If your nonprofit is required to have an annual audit — either by law, your funders, or your own governance standards — you'll likely go through a competitive bidding process to select an auditing firm. A well-written Request for Proposals (RFP) is the foundation of that process. It attracts qualified firms, filters out poor fits, and gives you a consistent basis for comparing bids.

Why bother with a formal RFP?

Many nonprofits simply call two or three accounting firms and ask for a quote. This works, but it has real downsides: you get inconsistent information, it's hard to compare proposals, and you may miss better-qualified firms you haven't heard of.

A formal RFP puts all bidders on the same footing, signals that your organization is professionally managed, and often attracts more competitive pricing. Funders and board members increasingly expect it.

What to include in your nonprofit audit RFP

1. Organization overview

Start with a concise description of your organization. Include:

• Legal name and EIN
• Mission and primary programs
• Annual budget and revenue sources (grants, earned revenue, donations)
• Number of employees and full-time equivalents
• Fiscal year end date
• States where you operate

Firms use this to assess complexity and staff accordingly. Don't undersell your organization — be specific.

2. Scope of services

Clearly state what you need. Most nonprofits require at minimum a financial statement audit in accordance with Generally Accepted Auditing Standards (GAAS). Depending on your situation, you may also need:

• Single Audit (Uniform Guidance): Required if you expend $750,000 or more in federal awards in a fiscal year
• Yellow Book audit: Required by some state and federal funders; follows Government Auditing Standards
• State-specific requirements: Many states require nonprofits above certain revenue thresholds to file audited financials with the attorney general
• Form 990 preparation: Some organizations ask their auditor to prepare the 990; others use a separate firm

Be explicit. Firms cannot price work they don't know about.

3. Timeline and deliverables

Include your fiscal year end, when you need the draft report, and when final audited financials must be completed. If you have board meeting deadlines or grant reporting requirements that affect timing, say so.

Also state how many copies of the report you need and in what format (PDF, bound copies, etc.).

4. Proposal submission requirements

Tell bidding firms exactly what to submit. A strong proposal typically includes:

• Firm overview and relevant nonprofit experience
• Proposed engagement team (partner, manager, senior)
• Approach and methodology
• References from similar nonprofit clients
• Fee estimate (broken down by service if applicable)
• Confirmation of independence
• Peer review results

5. Evaluation criteria

Let firms know how you'll score proposals. Common criteria include relevant nonprofit experience, team qualifications, responsiveness, fee, and references. Publishing your criteria signals professionalism and helps firms tailor their proposals.

6. Contact information and deadline

Include a single point of contact for questions, a deadline for submitting questions, and a firm proposal deadline. A typical timeline: issue the RFP 6–8 weeks before you need to make a decision, allow 2 weeks for proposals, then schedule finalist interviews.

Common mistakes to avoid

• Vague scope: “Annual audit” isn't enough. List every service you need.
• No budget guidance: You don't have to disclose your budget, but a ballpark range (e.g., “we anticipate fees in the range of $8,000–$15,000”) attracts better-fit proposals.
• Too short a deadline: Good firms are busy. Give at least two weeks to respond.
• No references check: Always call references. A proposal is a sales document; references reveal the real relationship.