On the 2024 not-for-profit Audit Committee Agenda

In 2023, nearly two years removed from the unprecedented disruption of the pandemic, the U.S. not-for-profit (NFP) sector contended with increasing political polarization, a backlash against environmental, social, and governance (ESG) initiatives, and heightened scrutiny of mission relevance and outcomes. The sector enters 2024 confronting several other risks, including fundraising and revenue diversification pressures following three years of federal COVID funding, accelerating cybersecurity threats, hiring and retention challenges, lingering inflation, high interest rates, intensifying geopolitical instability, and growing regulatory burdens. Moreover, 2024 is widely considered the largest and potentially most consequential global election year in history and could further shape how these evolving issues impact NFPs—from federal funding and programmatic investments to digitization and use of artificial intelligence (AI). Once again, NFP boards and audit committees will need to refine—or possibly even redefine—their risk-driven agendas.

Drawing on insights from our interactions with NFP audit committees and senior administrators, we’ve highlighted several issues to keep in mind as audit committees consider and carry out their 2024 agendas: • Keeping a watchful eye on the organization’s management of cybersecurity and data governance risks.

• Keeping a watchful eye on the organization’s management of cybersecurity and data governance risks.
• Defining the audit committee’s oversight responsibilities for artificial intelligence (AI).
• Understanding how the organization is managing ESG risks and potentially applicable regulations.
• Monitoring other emerging standards that could impact the organization.
• Staying focused on leadership and talent in finance and other functions.
• Helping to ensure internal audit is attentive to the organization’s key risks and is a valuable resource for the audit committee.
• Sharpening the organization’s focus on—and connectivity of—ethics, culture, and compliance.