Audits of Foundations and Associations
Audits for foundations can be mandatory by law, requiring compliance with certain thresholds, or voluntary, aimed at improving their public image.
In autonomous communities where a law exists regulating these non-profit entities, the regional law applies. The thresholds for external audits are not the same for each regional foundation. These thresholds should be understood as applying without prejudice to the provisions of the audit procedures that are of general application and which are contained in the Audit Law and its implementing regulations.
In summary, the requirements that determine the obligation to have accounts audited in certain cases can be summarized in two points:
Entities subject to Spanish legislation
Those entities subject to Spanish legislation that meet two of the following three requirements:
- Total assets exceeding €2,400,000
- Net annual revenue exceeding €2,400,000
- Average number of employees during the financial year exceeding 50.
Entities considered to be of public benefit
It should be noted that, with regard to associations declared to be of public benefit, those that must prepare annual accounts using the standard format are required to have their annual accounts audited. This means that:
- Total assets exceeding €2,850,000
- Annual ordinary revenue exceeding €5,700,000.
- Average number of employees during the fiscal year exceeding 50.
However, for entities subject to the Generalitat of Catalonia, the requirements are as follows (two of the following criteria must also be met):
- Total assets exceeding €6,000,000
- Annual revenue exceeding €3,000,000
- Average number of employees during the fiscal year exceeding 50.
Furthermore, it should be noted that entities receiving subsidies of €600,000 annually will also be required to undergo an audit. This also applies to those providing services or carrying out works for public administrations valued at €600,000 annually and representing more than 50% of their turnover.
However, for entities receiving subsidies in Catalonia, this limit is only €60,000 received from any administration. Furthermore, in cases where at least 40% of income comes from public administrations through subsidies, agreements, or any type of service contract,
At Vir Audit, we have extensive experience auditing foundations and associations throughout Spain, conducting both voluntary and mandatory audits. We possess the knowledge and expertise required for this type of specialized work, which differs from that required for commercial entities.