Category: Audit & Assurance

How Outsourced Audit Support Helps CPA Firms Manage Peak Nonprofit Audit Workloads

Post author By unison_globus
Post date September 24, 2026

By the third week of October, several nonprofit engagements can be moving through preparation, testing, and review at the same time. One client may be closing its annual financial statements while another is completing a Single Audit tied to federal awards, and a third may still have outstanding schedules or supporting documentation. For firms managing several engagements at once, outsourced audit support can provide additional execution capacity for defined work without changing where professional judgment and engagement responsibility sit.

The pressure often shows up in the review queue. Managers and partners may find themselves preparing lead schedules, organizing evidence, or following up on routine documentation while also reviewing work prepared by others. Overtime, internal redistribution, and seasonal hiring can help in specific situations, but they do not always address the underlying issue: experienced audit professionals are spending review time on preparation work.

For CPA firms, the practical question during these peak nonprofit periods is how to allocate defined execution work without disrupting the review and decision-making structure of the engagement.

TL;DR

Core message: Peak nonprofit audit periods create pressure when preparation, testing, documentation, client follow-up, and review converge across multiple engagements.
Where outsourced support fits: CPA firms can assign defined, reviewable work such as workpaper preparation, roll-forwards, schedules, PBC tracking, testing documentation, and exception identification, while retaining professional judgment and final engagement responsibility.
Why nonprofit expertise matters: Contributions, donor restrictions, net assets, functional expenses, grants, and Single Audit requirements create engagement-specific considerations that external support providers need to understand.
What firms should evaluate: Scope clarity, review controls, nonprofit and Single Audit experience, security, technology integration, communication, escalation procedures, and workflow compatibility.
Bottom line: Outsourced audit support can help firms manage variable peak workloads when the work is clearly defined and integrated into the existing review structure, without shifting engagement-level responsibility away from the CPA firm.

What Is a Nonprofit Audit?

A nonprofit audit is an independent examination of an organization’s financial statements and supporting records, covering areas such as contributions, donor restrictions, net assets, functional expenses, grants, and internal controls. Organizations subject to federal award requirements may also undergo a Single Audit, which adds federal program and compliance procedures. For federal awards issued beginning October 1, 2024, the expenditure threshold used in determining Single Audit applicability increased to $1 million, subject to the applicable federal award framework and requirements.
(Source: Federal Register: Guidance for Federal Financial Assistance )

The Nonprofit Audit Calendar Doesn’t Leave Room for Slack

Nonprofit audit workloads tend to arrive in overlapping waves rather than in a perfectly distributed sequence. Calendar-year organizations move toward year-end close and subsequent audit work while other clients may be preparing for board meetings, grant reporting, or other deadlines. June 30 fiscal-year organizations create another recurring workload pattern, so firms with a broad nonprofit portfolio can have several engagements moving through different stages at the same time.

That overlap becomes more significant when a firm is also handling Single Audits. These engagements add federal program and compliance procedures alongside the financial statement audit, including additional testing, documentation, and work associated with the Schedule of Expenditures of Federal Awards. The engagement team may therefore be coordinating multiple streams of work within the same reporting window.

Note: Single Audit threshold

For federal awards issued beginning October 1, 2024, the expenditure threshold used in determining Single Audit applicability increased to $1 million. Firms should apply the requirements based on the applicable federal award framework and fiscal period rather than treating the threshold as a blanket rule for every nonprofit engagement.

The practical challenge is therefore one of workflow timing. A firm may have the technical knowledge to perform the engagement while still finding that preparation, evidence collection, documentation, and review are converging too closely together

That distinction becomes particularly important during nonprofit audit preparation, when preparatory work starts consuming the same experienced hours needed later for review and resolution.

Where Peak-Period Audit Bottlenecks Actually Form

Peak workload rarely creates one large bottleneck. It usually produces several smaller constraints that interact as an engagement progresses. A schedule that takes longer to prepare delays testing, delayed testing pushes documentation closer to review, and that compressed sequence leaves managers with less room to evaluate multiple files in parallel.

Workpaper Preparation

Workpaper preparation is one of the first places where pressure becomes visible. Lead schedules, reconciliations, supporting documentation, roll-forwards, and recurring workpapers still need to be completed even when senior professionals are already committed to reviewing other engagements.

When a senior or manager absorbs that preparation because no other qualified resource is available, the immediate file may move forward, but the review schedule can become compressed. Across several files, preparation that finishes later than planned leaves reviewers with less time to evaluate the work, investigate exceptions, and resolve open items before other engagements reach the same review stage.

The operational question is therefore whether the firm can complete defined preparation work early enough to protect reviewer capacity during peak periods.

Testing and Evidence Documentation

Testing and evidence documentation can become particularly demanding on nonprofit engagements involving federal awards, restricted grants, or other areas requiring detailed supporting evidence. The work may involve gathering documentation, organizing it against the relevant procedure, recording the testing performed, and identifying items that require attention from the engagement team.

The timing and organization of evidence matter because incomplete or poorly documented testing can create additional follow-up during review. Clear documentation of the procedure performed, evidence examined, and items requiring attention gives the engagement team a more structured basis for evaluating exceptions and determining the next step. Defined testing activities can therefore be supported externally when the firm’s procedures, documentation expectations, and escalation criteria are already established.

Roll-Forwards and Supporting Schedules

Roll-forwards and supporting schedules are recurring components of many audit engagements. They may involve less engagement-level judgment than final review, but they still require familiarity with the firm’s methodology, documentation expectations, and client-specific information.

Roll-forwards and supporting schedules are particularly suitable for a structured preparation model when the firm already has defined templates, prior-year information, and established documentation requirements. External support can organize recurring schedules against those requirements, giving the engagement team a consistent starting point for review and exception evaluation.

Review Queues

Review queues create a different constraint: several engagements can become review-ready at nearly the same time, even when each file progressed through preparation at a different pace.

A file that reaches review two weeks later than planned can occupy the same reviewer during a much more crowded period. For firms managing several nonprofit engagements, the challenge is therefore the concentration of review work across multiple files, rather than simply the number of preparation hours available.

Client Follow-Up

Client follow-up introduces another variable. Nonprofit finance teams may be coordinating board approvals, grant documentation, restricted-fund information, allocation details, and other supporting records while managing their regular accounting responsibilities.

When required information is missing, specific procedures may have to pause. The engagement team then has to determine what can continue, what requires follow-up, and what should remain open until the evidence arrives.

External support can help maintain PBC (Prepared by Client) trackers, organize outstanding requests, and flag missing items against the engagement team’s requirements. The engagement team still determines whether the available evidence is sufficient and what additional client communication or audit procedures are necessary.

Why Adding More Hands Doesn’t Always Solve the Problem

Firms have several ways to respond to peak demand, including overtime, seasonal hiring, and internal redistribution. Each can be appropriate depending on the duration and predictability of the workload.

The constraint appears when additional hours increase execution capacity without addressing the stage where the engagement is actually constrained. Internal redistribution can relieve one engagement while creating pressure on another, particularly when the same senior professionals are needed for review.

The U.S. Bureau of Labor Statistics projects about 115,300 openings for accountants and auditors each year, on average, from 2025 through 2035, with many openings reflecting replacement needs. BLS also notes that longer work periods are typical during periods such as quarterly audits and tax season. These figures cover the broader accountants-and-auditors occupation rather than nonprofit audit specifically.

The more useful management question is specific to the firm’s workflow: Which activities require the firm’s most experienced professionals, and which can be clearly assigned, documented, and reviewed by another qualified resource?

The answer can vary by engagement. A firm with sustained year-round demand may have a different staffing requirement from one that experiences concentrated nonprofit audit peaks several times a year.

Need additional support during peak nonprofit audits? See how we support CPA firms with workpapers, documentation, schedules, and defined testing.

Explore Our Audit Support for CPA Firms

Where Outsourced Audit Support Fits in the Engagement Workflow

Outsourced audit support provides additional execution capacity for clearly defined, reviewable engagement activities. Nonprofit audit support services can fit within the CPA firm’s existing procedures, templates, technology, and review framework.

Engagement need	Potential external support	Internal CPA firm responsibility
Workpaper preparation	Defined preparation and organization	Review and approval
Supporting schedules	Roll-forwards and documentation	Evaluation and review
Defined testing support	Testing and evidence documentation under established procedures	Professional evaluation and conclusions
PBC organization	Tracking and documentation support	Client relationship and follow-up decisions
Documentation	Workpaper and evidence organization	Review of sufficiency and appropriateness
Exceptions	Identification and escalation	Resolution and professional judgment
Review notes	Administrative preparation support	Evaluation and final disposition

A practical workflow can therefore run through:

Assign → Prepare → Document → Identify Exceptions → Review → Resolve → Final Engagement Review

When the external team identifies an unusual transaction, incomplete evidence, or judgment-sensitive matter, it should escalate the item to the firm’s engagement team.

The firm’s professionals then evaluate the matter, perform the required review, determine the appropriate response, reach engagement-level conclusions, and retain final oversight.

Clarification: External execution does not transfer engagement responsibility

A support provider can perform defined engagement activities while the CPA firm retains responsibility for professional evaluation, significant-matter decisions, engagement conclusions, client decisions, and final engagement oversight.

For firms evaluating audit support for CPA firms, the important question is therefore how the external work enters the firm’s existing process. A provider that can complete individual tasks but requires managers to rebuild the work or operate a separate documentation process may add coordination rather than remove it.

Nonprofit Audit Work Requires Engagement-Specific Support

Nonprofit engagements contain accounting and reporting considerations that affect how preparation work should be organized. The support model therefore needs to reflect the nature of the organization, its funding arrangements, and the applicable financial reporting and audit requirements.

The 2026 AICPA Not-for-Profit Entities – Audit and Accounting Guide covers distinctive NFP accounting, financial statement preparation, and auditing considerations, including audit planning, risk assessment, financial statements, contributions, agency transactions, and fund accounting.

Contributions and Donor Restrictions

Contribution-related work can require supporting schedules that distinguish restricted and unrestricted activity and preserve the documentation necessary for the engagement team’s evaluation. The underlying records and supporting evidence should align with the firm’s established audit procedures and documentation requirements.

Net Asset Classification

Net asset classification requires supporting information that reflects applicable donor restrictions and financial reporting requirements. External support can organize the underlying information, while the engagement team evaluates the classification and supporting documentation.

Functional Expense Information

Where the engagement involves functional expense allocation, preparation should preserve the client’s underlying records, allocation methodology, and supporting documentation for the engagement team’s evaluation. Where those elements are already defined, the work may be suitable for structured external support.

Grants and Federal Awards

Grant-funded organizations can introduce additional documentation and coordination requirements. Engagement teams may need information concerning grant terms, expenditures, compliance requirements, and supporting records before particular procedures can be completed. The engagement team evaluates whether the evidence satisfies the applicable audit procedures and determines the response to exceptions, compliance matters, or unusual circumstances.

Single Audit Support

Single Audit engagements add federal compliance work alongside the financial statement audit. Depending on the engagement, support may involve documentation, testing performed under established procedures, and organization of evidence associated with federal programs and the SEFA.

GAO analyzed 3,680 Single Audit findings from audit years 2022 through 2024 that were addressed to prime recipients that passed federal funds through to subrecipients. The analysis identified recurring compliance issues involving areas such as subaward reporting, subrecipient monitoring, and eligibility decisions.

(Source: GAO report: GAO, Grants Management: Recent Guidance Could Enhance Subaward Oversight)

This analysis does not measure outsourcing demand or audit workload directly. It provides context on the types of compliance issues identified through Single Audits involving federal subawards.

For firms handling this work, provider familiarity with nonprofit and Single Audit processes becomes a practical selection criterion. General audit experience does not necessarily indicate familiarity with the documentation and compliance requirements involved in a particular NFP engagement.

What Firms Should Validate Before Using External Audit Support

Once the potential scope is defined, provider evaluation becomes less about a generic outsourcing checklist and more about whether the arrangement can function within the firm’s engagement controls.

Professional Judgment and Responsibility: The firm should clearly distinguish execution support from activities requiring professional judgment, significant-matter evaluation, or engagement-level conclusions.
Quality and Review: Externally prepared work should follow the firm’s existing review structure, documentation expectations, procedures, and review criteria.
Confidentiality and Data Security: Firms should understand how engagement information is accessed, transferred, stored, and restricted, particularly where nonprofit records, donor information, employee data, or federal award documentation are involved.
Technology and Workflow Integration: Firms should evaluate compatibility with their audit software, templates, documentation conventions, and file structures to avoid unnecessary handoffs and additional coordination.
Scope and Task Ownership: The firm should clearly define what is assigned externally, what remains internal, and which matters require escalation. A task that becomes more complex during preparation should return to the appropriate engagement professional.
Communication and Escalation: The support model should establish how exceptions, unusual transactions, missing evidence, and ambiguous items are escalated to the engagement team and how the next step is communicated.
Nonprofit Experience: When evaluating an offshore audit team, firms should consider relevant experience with restricted contributions, nonprofit financial statements, grant activity, Uniform Guidance considerations, and Single Audit documentation.

How to Compare Capacity Options During Peak Audit Periods

Outsourced support is one option within a broader set of capacity approaches. Firms can compare the alternatives based on how long the demand lasts, how quickly support is required, what skills the work demands, and how closely the resource needs to operate within the existing engagement structure.

Capacity model	Best fit to evaluate around	Key considerations
Permanent hiring	Recurring, year-round demand	Recruitment, development, retention, and ongoing cost
Seasonal hiring	Predictable seasonal volume	Hiring timeline, onboarding, availability, and training
Overtime	Immediate short-term pressure	Existing team capacity and sustainability
Internal redistribution	Uneven workload across teams	Effect on the engagements losing that capacity
Selective outsourced support	Defined, variable execution needs	Scope clarity, review structure, security, and provider fit

The comparison should also consider how the firm repeatedly absorbs peak periods. If senior professionals move into preparation work, review can become concentrated later in the engagement. If managers absorb routine client coordination, their review schedules become less predictable.

These patterns can show where the firm’s current operating model is absorbing seasonal demand and whether a defined execution resource could address a specific constraint.

When Outsourced Audit Support Is Worth Evaluating

Outsourced audit support is worth evaluating when a firm can identify recurring activities that consume meaningful preparation time during peak periods and define those activities clearly enough for another qualified resource to perform and document them.

The model can be particularly relevant when several nonprofit engagements overlap, demand varies significantly by season, and the firm already has established review procedures.

A different approach may deserve attention first when a first-year engagement involves unusual complexity, work remains judgment-heavy throughout, scope is unclear, or internal review procedures are inconsistent.

The strongest starting point is a defined portion of the workflow where task ownership, documentation expectations, review procedures, and escalation paths are already understood. For firms considering offshore audit services, the same principle applies: external support can strengthen a defined workflow, but it cannot compensate for unclear task ownership, incomplete documentation, weak review criteria, or poor engagement planning.

Where This Leaves the Peak-Season File

The October schedule makes the distinction clear. The same nonprofit engagements are still running, client documentation still arrives at different times, and the firm still has to meet its engagement deadlines.

For firms considering outsourced audit support, the practical question is which activities require the firm’s highest-level expertise and which defined execution tasks can be prepared externally and brought back into the established review structure.

Here, Unison Globus supports Audit Support Services for CPAs and Accounting Firms, covering defined audit preparation, documentation, workpaper, schedule, and testing activities within the firm’s engagement workflow. For firms managing peak periods, its offshore audit support can help keep defined preparation work moving while the CPA firm retains professional judgment, review authority, and final engagement responsibility.

Audit Workload Challenges Extend Beyond One Market

While nonprofit audit requirements vary by jurisdiction, accounting firms across markets face similar pressure during peak periods: keeping preparation, documentation, and review work moving while senior professionals manage deadlines and engagement oversight. The specific requirements differ, but the underlying challenge of balancing routine execution with senior-level review is widely shared.

In the UK, firms manage peak pressures around year-end accounts, tax compliance, and audit and assurance services. In Australia, audit and assurance engagements can create similar demands on preparation, documentation, and review teams. In the US, nonprofit audits, Single Audits, and year-end engagements can place additional pressure on preparation and review workflows.

For firms exploring offshore capacity, the provider’s location is only one consideration. An audit outsourcing company in India may support defined preparation and documentation activities, but firms should evaluate the provider’s nonprofit experience, review processes, security controls, technology compatibility, and ability to work within the existing engagement workflow.

Facing nonprofit audit bottlenecks during peak periods? See how our defined offshore audit support can keep preparation moving while your team stays focused on review.

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Frequently Asked Questions

Which nonprofit audit tasks can realistically be supported by an outsourced team?

Defined activities such as workpaper preparation, roll-forwards, supporting schedules, PBC organization, and testing documentation can be supported externally. Engagement-level professional judgment and conclusions remain with the CPA firm’s team.

What stays the CPA firm’s responsibility when using outsourced audit support?

The CPA firm retains professional judgment, evaluation of significant matters, engagement-level conclusions, review authority, and final engagement oversight.

How does outsourced audit support fit into an existing engagement workflow?

It can support defined preparation and documentation stages. Assigned work is prepared and documented, with exceptions or judgment-sensitive matters escalated to the firm’s established review and resolution process.

How do firms maintain quality and review controls over externally prepared work?

Route externally prepared work through the firm’s existing review structure and apply the same documentation expectations, procedures, and review criteria used for internally prepared work.

What should a CPA firm evaluate before choosing an audit support provider?

Evaluate nonprofit and Single Audit experience, task-level scope, review procedures, data security, technology compatibility, communication protocols, escalation procedures, and the provider’s ability to integrate with the firm’s workflow.

When does outsourced audit support make more sense than seasonal hiring?

It can be worth evaluating when demand is seasonal or variable, activities can be clearly scoped and reviewed, and the firm needs additional execution support without creating a permanent year-round requiremen

Audit & Assurance Auditing

Why August Is the Best Time for CPA Firms to Fix EBP Audit Gaps Before Peak Season

Post author By unison_globus
Post date July 7, 2026

Ask any CPA firm that handles Employee Benefit Plan audits what their year feels like, and the answer is usually some version of “fine until it isn’t.” Spring brings the document chase. July brings the first Form 5500 deadline. Then, for a few weeks in August, the phone stops ringing, and the inbox slows down, before October brings the second deadline for firms that filed an extension. Most firms treat that August stretch as recovery time. Catch up on email, take a vacation, regroup before the next plan year’s paperwork starts arriving in February.

That instinct is understandable, but it wastes the one window in the calendar where a firm actually has the bandwidth to look at its Employee Benefit Plan (EBP) Audit Support process honestly. Not while a client is waiting on a draft report. Not while a reviewer is buried in testing. In August, there’s room to ask harder questions: where did the last cycle bog down, what kept getting flagged in review, and where did the firm rely on one overworked person to catch problems a better process should have caught earlier.

Those questions matter more in EBP work than almost anywhere else in a CPA firm’s practice, because the margin for error is thinner and the regulatory scrutiny under ERISA is sharper. The DOL’s most recent Audit Quality Study found that 30% of employee benefit plan audits contain one or more major deficiencies, and that 70% of audits performed by firms handling just one or two plans a year fall into that same category. A gap that goes unaddressed in August doesn’t stay quiet. It resurfaces in February as a missing PBC item, in June as a rushed testing schedule, and in October as a deficiency letter nobody saw coming.

This blog looks at what those gaps usually look like and why CPA firm EBP audit outsourcing, brought in during the quieter months, tends to hold up better once peak season hits.

Where Employee Benefit Plan(EBP) Audit Support Gaps Actually Show Up

“Audit gap” sounds abstract until you’ve sat through a peer review that flags the same three things every firm seems to struggle with: testing that didn’t go deep enough, contribution and benefit payment procedures that were rushed, and documentation that doesn’t fully back up the work performed. None of these are exotic failures. They’re the kind of thing that happens when a firm is moving fast and a senior reviewer doesn’t have the hours to look closely enough.

A few patterns show up again and again in firms offering Audit & Assurance Services for CPAs without a dedicated EBP specialty:

PBC lists that drag on for weeks: Getting a complete, accurate, provided-by-client list out of a plan sponsor is often the single biggest source of delay. When a firm doesn’t have a standardized process for chasing this down, the entire engagement timeline shifts later, leaving less room for actual testing.
Limited-scope certifications that get accepted without a second look: A certification letter from the plan’s custodian is supposed to be reviewed for completeness, not just filed. Skipping that step is a quiet way deficiencies creep into ERISA audit support work.
Testing schedules built under time pressure: Contribution testing and benefit payment testing both require a level of detail that’s hard to maintain when one reviewer is covering five engagements at once during peak weeks.
Thin documentation trails: Workpapers that explain what was tested and why hold up under peer review. Workpapers built in a rush, with the reasoning left out, don’t. This is one of the easiest gaps to prevent when there’s time to build a checklist instead of relying on memory.

The common thread isn’t a lack of knowledge. It’s a lack of hours, and that shortage isn’t going away on its own. Only 6% of accounting and finance leaders say they currently have the talent they need for their highest-priority work, and unemployment in the field sits at roughly 2 percent, meaning most of the people who could fill that gap are already employed somewhere else. For firms providing 401(k) audit support services, that math doesn’t leave much room to simply add another reviewer before next season starts.

This is the part of the picture that makes August worth taking seriously: every one of these gaps is fixable with planning, but only if the fix happens before the workload returns.

Curious what offshore EBP audit support could take off your team's plate this season?

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Closing the Gaps with Employee Benefit Plan Audit Outsourcing

Once you can name the gaps specifically, the fix stops being vague too. Each pattern from the last section has a direct counterpart in how a well-run Employee Benefit Plan audit outsourcing arrangement is structured. This is less about adding headcount and more about adding a layer of dedicated capacity an in-house team doesn’t have room to build on its own.

PBC management gets a dedicated owner: Instead of a senior reviewer chasing documents between other engagements, an offshore team can own the PBC list end to end, tracking what’s outstanding and flagging missing items early enough to matter. Offshore teams working overnight can have completed work waiting for the in-house team the next morning, turning a multi-day back-and-forth into an overnight cycle.
Certifications get reviewed, not just filed: A trained offshore Employee Benefit Plan (EBP) Audit Support team checks limited-scope certification letters against the plan’s investment data as a standard workflow step, rather than something that gets skipped once the engagement gets busy.
Testing gets the hours it needs: Offshore EBP audit services can run contribution and benefit payment testing in parallel with the in-house team’s other work, instead of squeezing it into whatever time is left during peak weeks. The work still gets reviewed and signed off by the US team, but it isn’t rushed to fit around five other engagements at once.
Documentation becomes a built-in habit, not an afterthought: Firms that build outsourcing into their process typically standardize workpaper templates and run them through layered review before anything reaches the US team. A structured offshore delivery model puts work through self-review, a senior peer review, and a final US-side check, with error rates tracked weekly, rather than caught after the fact in a peer review.

None of this is theoretical anymore. The AICPA’s National Pipeline Advisory Group has pointed to the talent shortage as a direct cause of financial reporting delays across US businesses, and roughly 80% of accounting firm executives say they plan to increase their use of offshore teams over the next three to five years, according to a 2025 William Blair survey.

This is also where offshore audit support for CPA firms earns its place specifically in ERISA audit support work, where judgment requirements are higher and oversight is stricter than in most other outsourced accounting functions. The firms getting this right aren’t handing off audit opinions or Expert CPA Audit Services. They’re handing off the volume work, testing prep, documentation assembly, and PBC tracking, so the in-house team’s limited hours go toward review and judgment instead of data entry and follow-up.

That’s the version of CPA firm EBP audit outsourcing worth setting up in August, while there’s time to train the offshore team and work out the kinks before the next cycle starts. It’s also how firms turn a single outsourced engagement into a repeatable part of their broader audit & assurance solutions, ready well before 401(k) audit support services are needed again.

What Has to Be True Before an Offshore Team Touches a Live File

Outsourcing in an ERISA engagement raises a fair question before a comfortable one: what’s actually allowed to leave the building, what does it cost, and what does a client need to be told? Four things have to be settled before Employee Benefit Plan audit outsourcing works.

Where the line stays: AICPA independence standards separate staff augmentation, where outsourced staff perform procedures under the firm’s direction and review, from management functions, which can’t be delegated regardless of where the provider sits. An offshore EBP audit services team can prepare testing schedules, assemble documentation, track PBC items, and flag exceptions. Risk assessment, materiality decisions, and signing the opinion stay exclusively with the engagement partner. Every file coming back is a draft for review, run through the same self-review, senior peer review, and final US-side check the firm already uses in-house.

What has to be secure: Plan data includes SSNs, account balances, and beneficiary information, higher-sensitivity than a typical financial statement audit. Before any engagement letter is updated, confirm the provider has SOC 2 Type II reporting, encryption in transit and at rest, a documented retention policy, and role-based access controls. These belong in the same August planning window as training, and they’re usually the first thing a peer reviewer asks about.

What sponsors need to hear: Satisfying IRC §7216 consent requirements is one thing; a sponsor actually understanding that an overseas team will touch their plan’s data is another. Most sponsors aren’t troubled by offshore audit support for CPA firms, they’re troubled by learning about it after the fact. A short, proactive conversation confirming partner supervision and the security controls above usually turns this into a non-issue.

What it costs, and what it’s worth: CPA firm EBP audit outsourcing is typically priced well below the fully loaded cost of a US senior associate, and since EBP capacity needs are seasonal (roughly 12–16 weeks a year), cost scales with actual volume instead of carrying a full-time load year-round. The harder number to quantify is the cost of a deficiency: re-performed procedures, extra partner hours, and repeat-offender exposure with the DOL. The right comparison isn’t offshore cost against zero, it’s offshore cost against the deficiency rates already cited.

What this looks like in practice: Firms that do this well start August with a quick audit of last cycle’s deficiencies and turn that into the offshore team’s training curriculum, built on the firm’s own templates. The team then runs two or three closed, lower-stakes files through the full review hierarchy before touching anything live. By February, they’re already working inside the firm’s process, not learning it under deadline pressure. Firms that skip this end up doing the same onboarding anyway, except now it’s competing with live deadlines, which is exactly the trade-off 401(k) audit support services are meant to avoid.

The Cost of Waiting Until February

Every firm reading this already knows what February looks like. Document requests start landing, the same reviewers who were stretched thin last cycle are stretched thin again, and there’s no time to fix anything, only to get through it. Whatever gaps existed last year are still there, waiting for the workload to expose them again.

The honest picture here is more complicated than “the pipeline is collapsing.” New CPA exam candidates hit a record low of just 27,994 in 2024, the fewest since NASBA began tracking in 2008, but first-half 2025 data showed 16,448 new candidates, suggesting a real rebound toward pre-2024 levels. The pipeline is recovering. What isn’t recovering as fast is the staffing already inside firms today. Industry data shows the average share of staff holding an active CPA license at accounting firms fell from 56.0% in 2020 to 48.4% in 2024, dropping below half for the first time, and the ratio is even lower at large firms.

That’s the gap firms are actually managing through this year and next: not a pipeline that will never refill, but a workforce that’s thinner right now than it’s been in years, with the recovery still a few years from showing up on engagement teams. Treating that gap as a problem to figure out fresh each February means absorbing the same crunch every cycle. The alternative is building Employee Benefit Plan audit outsourcing into the firm’s process before the workload hits, not after.

Why August Is the Right Time to Make the Move

That’s exactly why August matters. Every benefit of outsourcing depends on the offshore team and the in-house team actually knowing how to work together before a live file lands on either desk, and that’s not something built in a week.

Onboarding isn’t instant, and treating it like a plug-and-play fix is usually where firms run into trouble. Firms that have gone through the process consistently name training as the top challenge, citing the extended onboarding period, offshore staff needs, and the difficulty of finding time for domestic staff to do that training when everyone is already busy. What a slow month actually allows a firm to build:

A shared way of working, not just a handoff: Before anyone touches a live file, the in-house team can walk an offshore EBP audit services team through how the firm actually operates: where PBC requests get logged, how testing schedules are structured, what a finished workpaper is supposed to look like. That groundwork is what makes the relationship feel like an extension of the team rather than a vendor waiting for instructions.
A review process that’s been run a few times before it matters: Structured offshore delivery models are typically built around layered review: self-review, senior peer review, and a final US-side check, with error rates tracked over time. That rhythm needs a few practice cycles on lower-stakes work before it’s trusted on a live ERISA audit support engagement.
Comfort with a new rhythm of communication: Time zone handoffs, file-sharing protocols, and who to flag when something looks off all take a few rounds to feel natural. Working that out in August means nobody’s learning it for the first time while a client is waiting.
The paperwork that has to happen before any data moves: IRC Section 7216 requires explicit client consent before any tax- or return-related data is shared with a third-party provider, including an offshore provider. Hence, engagement letters need to be updated in advance. That’s a conversation worth having with clients in a quiet month, not buried in a February intake call.

None of this is about flipping a switch in August and being fully scaled by September. It’s about using the slow season to lay the foundation for CPA firm EBP audit outsourcing, so that when document requests start arriving for the next plan year, the 401(k) audit support services team isn’t being introduced to the firm’s process. They’re already working inside it. A firm that waits until the cycle is underway ends up training a new team and running a live audit at the same time, which is exactly the kind of pressure that produces the deficiencies covered earlier, and exactly what strong offshore audit support for CPA firms is meant to prevent.

What changes year to year isn’t the deficiency risk or the staffing pressure behind it. What changes is whether a firm uses its quietest month to get ahead of that reality or spends it waiting for next season to arrive. For firms ready to build CPA firm EBP audit outsourcing, offshore EBP audit services, and 401(k) audit support services into how they actually operate, August is the month that the decision gets made.

The Window Is Open Now

August won’t last. By the time document requests start arriving in February, the firms that spent this stretch building Employee Benefit Plan audit outsourcing into their workflow will be running a tested process. The ones that didn’t will be improvising under the same pressure that produced the deficiencies covered earlier.

Unison Globus works with CPA firms to build that capacity ahead of time, with offshore EBP audit teams trained on a firm’s specific PBC, testing, and documentation standards before peak season ever starts. Our Audit & Assurance Services also help accounting firms across North America strengthen audit quality and expand engagement capacity year-round. If your firm is ready to close this year’s gaps before next year’s deadlines arrive, talk to Unison Globus. .

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Frequently Asked Questions

Does our firm remain responsible for the audit opinion if we outsource testing and documentation?

Yes, fully. Offshore staff work under the engagement partner’s supervision and review, the same as any in-house associate. Every conclusion, judgment call, and signature stays with the US team, regardless of how much of the underlying work is handled through Employee Benefit Plan audit outsourcing.

Are there restrictions on outsourcing EBP audit work under PCAOB or state board rules?

Requirements vary by state and by the nature of the engagement, and some boards require specific disclosures around outsourced procedures. Firms should confirm current requirements with their state board and legal counsel before finalizing any CPA firm EBP audit outsourcing arrangement, since this is jurisdiction-specific and changes over time.

Do we need client consent before sharing data with an offshore team?

For tax- or return-related data, IRC Section 7216 requires explicit, documented client consent before that data is shared with any third-party provider, onshore or offshore. Engagement letters should be updated to reflect this before any file moves to an offshore EBP audit services team.

What happens to plan participant data once the engagement ends?

A documented retention and deletion policy should specify how long data remains on the offshore provider’s systems and confirm secure deletion once the engagement closes. This should be agreed upon and documented before the engagement begins, not addressed after the fact, as part of any offshore audit support for CPA firms arrangement.

How long does it take to get an offshore EBP team fully up to speed?

Most firms see a meaningful difference between a team trained for a few weeks on practice files in a quiet month versus one introduced mid-cycle. There’s no fixed timeline, but the August-to-February runway is what most firms use to get an Employee Benefit Plan (EBP) Audit Support team comfortable before live engagements start.

Will plan sponsors need to be told that an offshore team is involved?

Sponsors generally respond better to a direct, proactive conversation about outsourcing than to finding out informally. While the formal requirement is client consent for return-related data, raising it as part of the engagement letter discussion avoids surprises later, particularly for firms building out ERISA audit support or 401(k) audit support services through an offshore partner.

Audit & Assurance Auditing

EBP & NFP Audits in 2026: Compliance Challenges and How CPA Firms Can Prepare Early

Post author By unison_globus
Post date June 16, 2026

For many CPA firms, Employee Benefit Plan (EBP) and nonprofit (NFP) audits are no longer routine compliance engagements. Regulatory expectations continue to evolve, audit quality remains under scrutiny, and staffing pressures are making it increasingly difficult to deliver engagements efficiently during peak periods.

In 2026, firms performing an employee benefit plan audit or managing NFP audit compliance responsibilities must navigate a complex environment shaped by ERISA requirements, ongoing SECURE 2.0 implementation, updated federal guidance for nonprofits, and heightened expectations around audit documentation and reporting. At the same time, clients expect timely service, accurate reporting, and proactive guidance on emerging compliance risks.

For employee benefit plans, requirements under SAS No. 136 continue to influence audit execution and reporting, while Form 5500 filing obligations remain a critical deadline for both plan sponsors and auditors. Nonprofit organizations are adapting to updated Single Audit thresholds and evolving funding requirements, creating new considerations for firms supporting nonprofit audit preparation and compliance efforts.

Adding to these challenges, CPA firms continue to face talent shortages, growing workloads, and increased pressure to adopt new technologies. As engagement complexity rises, many firms are evaluating how to maintain audit quality while managing capacity constraints.

This article explores the key developments affecting ERISA audit compliance and nonprofit audit requirements in the USA, the most common challenges firms face in 2026, and practical strategies for preparing audit teams for a demanding year ahead.

The Employee Benefit Plan Audit Landscape in 2026

The regulatory environment surrounding employee benefit plan audits continues to evolve, requiring CPA firms to stay current with changing compliance expectations and audit standards. As plan sponsors adapt to legislative updates and increased oversight, auditors are expected to perform more robust procedures, maintain stronger documentation, and provide greater assurance around plan operations and financial reporting.

For firms providing Employee Benefit Plan (EBP) Audit Support, understanding the key requirements shaping the 2026 audit cycle is essential for delivering high-quality engagements and helping clients remain compliant

1. ERISA Audit Requirements Continue to Drive Audit Obligations

Under the Employee Retirement Income Security Act (ERISA), retirement plans that meet applicable large-plan filing requirements generally must include audited financial statements with their annual Form 5500 filing. While the 100-participant threshold is commonly associated with audit requirements, plan classification rules and reporting provisions can affect whether an audit is required.

An employee benefit plan audit extends beyond the review of financial statements. Auditors are expected to evaluate participant data, contributions, distributions, investments, administrative expenses, and plan operations to determine whether financial information is fairly presented and required disclosures are complete.

2. SAS No. 136 Has Raised the Bar for Audit Quality

Several years after its implementation, SAS No. 136 continues to influence how firms approach ERISA audit compliance.

The standard introduced enhanced responsibilities for auditors, including more rigorous risk assessment procedures, expanded communication requirements with plan management, and updated reporting standards. It also strengthened expectations around evaluating certifications provided by custodians and trustees.

The standard has increased expectations around planning, documentation, auditor communications, and risk assessment procedures. As regulators continue to emphasize audit quality, firms are expected to apply a structured and risk-focused approach throughout the engagement lifecycle.

3. Form 5500 Deadlines Remain a Critical Compliance Milestone

For calendar-year plans, July 31, 2026 remains the standard filing deadline for Form 5500. Plan sponsors that file Form 5558 on time may generally extend their filing deadline until October 15, 2026.

Because the audit report is a required component of the filing process for many plans, audit readiness directly impacts a sponsor’s ability to meet regulatory deadlines.

Late or incomplete Form 5500 filings can result in significant regulatory penalties and corrective actions. To reduce filing risks and avoid delays, many CPA firms encourage plan sponsors to begin audit preparation well in advance of the reporting deadline.

4. SECURE 2.0 Continues to Influence Plan Operations

While many SECURE 2.0 provisions have already taken effect, implementation challenges continue to surface throughout 2026.

Plan sponsors are working through requirements related to:

Catch-up contribution provisions
Employee eligibility tracking
Automatic enrollment requirements
Plan amendment deadlines
Participant communication obligations

These changes affect not only plan administration but also audit procedures. Auditors must understand how sponsors are implementing new requirements and whether supporting documentation demonstrates compliance.

As a result, SECURE 2.0 remains an important consideration during audit planning and risk assessment.

5. Determining the Appropriate Audit Type

Another key area of focus involves determining whether a plan qualifies for an ERISA Section 103(a)(3)(C) audit, formerly referred to as a limited-scope audit.

This determination affects:

Certification requirements
Audit procedures performed
Auditor reporting responsibilities
Documentation expectations

Plans that qualify for an ERISA Section 103(a)(3)(C) audit must obtain appropriate certifications from qualified institutions, while plans that do not qualify may require more extensive audit procedures.

Given the documentation requirements involved, firms should evaluate audit eligibility early in the engagement process.

6. Common Compliance Risk Areas for EBP Audits

Although every plan is unique, regulators continue to identify several recurring compliance concerns.

Some of the most common issues include:

Late participant contribution deposits
Inaccurate participant eligibility tracking
Inconsistent Form 5500 reporting
Errors in distributions and loans
Incomplete audit documentation
Investment valuation concerns
Related-party and party-in-interest transactions

Many of these issues originate from operational processes rather than accounting errors, making early communication between auditors and plan sponsors especially important.

For firms evaluating how to prepare for EBP audits in 2026, the most effective strategies remain consistent: engage clients early, establish standardized audit procedures, address documentation requests proactively, and monitor regulatory developments that may affect plan administration and reporting requirements.

7. EBP Audit Readiness Checklist

✓ Review participant census data

✓ Verify employee eligibility calculations

✓ Reconcile contributions and distributions

✓ Confirm investment balances and valuations

✓ Request SOC 1 reports from service providers

✓ Review plan amendments and SECURE 2.0 updates

✓ Evaluate internal controls and documentation

✓ Reconcile Form 5500 information to audited statements

✓ Confirm ERISA 103(a)(3)(C) audit eligibility

For CPA firms, maintaining ERISA audit compliance in 2026 requires a combination of technical expertise, early planning, and consistent execution. As regulatory expectations continue to evolve, firms that invest in strong audit methodologies, staff training, and proactive client communication will be better positioned to manage risk, support compliance, and deliver high-quality audit outcomes.

Nonprofit Audit Requirements USA: What CPA Firms Need to Know

While employee benefit plan audits continue to evolve, nonprofit organizations are navigating their own set of regulatory and reporting challenges. Changes to federal grant compliance requirements, varying state audit thresholds, and increasing expectations around financial transparency are creating a more complex environment for both nonprofits and the CPA firms that serve them.

For firms supporting nonprofit clients, understanding current nonprofit audit requirements USA is essential for managing compliance risks, improving audit readiness, and helping organizations meet the expectations of regulators, grantors, donors, and governing boards.

1. The Single Audit Threshold Has Increased

One of the most significant recent developments affecting the nonprofit sector is the increase in the federal Single Audit threshold from $750,000 to $1 million in federal expenditures. The revised threshold applies to fiscal years beginning on or after October 1, 2024, making 2026 the first full audit cycle in which many organizations are operating under the updated requirements.

As a result, organizations that expend $1 million or more in federal awards during their fiscal year are generally subject to Single Audit requirements under Uniform Guidance. Unlike a standard financial statement audit, a Single Audit also evaluates compliance with federal program requirements and internal controls over federal awards.

For CPA firms, this change requires careful planning, particularly when clients receive funding from multiple federal programs or pass-through entities.

2. Audit Requirements Extend Beyond Federal Funding

Federal expenditure thresholds are only one factor that may trigger a nonprofit audit.

Many organizations obtain audited financial statements because of:

State regulatory requirements
Grantor or funding agency requirements
Lending agreements
Board policies or organizational bylaws
Donor expectations

As a result, nonprofits should evaluate audit obligations holistically rather than relying solely on federal funding levels.

3. State Audit Thresholds Continue to Vary

Unlike federal requirements, nonprofit audit requirements vary significantly by state.

Examples of commonly cited state thresholds include:

State	Commonly Referenced Audit Threshold*
California	$2 million in annual gross revenue
New York	$1 million in annual gross revenue
Pennsylvania	$750,000 in annual revenue
Massachusetts	$500,000 in annual revenue
Connecticut	$500,000 in annual revenue
Rhode Island	$300,000 in annual revenue

*State audit requirements may depend on charitable registration rules, fundraising activity, organizational structure, or other state-specific provisions. Organizations should review current state regulations to determine their specific obligations.

4. Financial Reporting Remains a Core Compliance Requirement

Accurate financial reporting remains central to effective NFP audit compliance.

Most nonprofit organizations prepare four primary financial statements:

Statement of Financial Position
Statement of Activities
Statement of Cash Flows
Statement of Functional Expenses

These reports provide donors, grantors, regulators, and board members with critical information about an organization’s financial condition, operating results, liquidity, and use of resources.

Maintaining complete supporting documentation for these statements is often one of the most important aspects of successful nonprofit audit preparation.

5. Common Challenges in Nonprofit Audit Preparation

Many nonprofit organizations operate with lean finance teams and limited administrative resources, creating challenges throughout the audit process.

Common issues include:

Incomplete grant documentation
Delayed account reconciliations
Weak documentation of donor restrictions
Revenue classification errors
Inconsistent expense allocations
Limited segregation of duties
Delays in financial reporting

Addressing these issues before fieldwork begins can improve audit efficiency and reduce the likelihood of audit adjustments or compliance findings.

6. Managing Restricted Funds Requires Strong Controls

One of the most common compliance challenges in the nonprofit sector involves managing donor-restricted funds.

Organizations must maintain documentation supporting:

The purpose of restricted contributions
Spending activity against restrictions
Remaining restricted balances
Releases from restriction

Failure to properly track restricted funds can affect financial statement accuracy and create compliance concerns during the audit process.

7. Revenue Classification Remains a Common Risk Area

Another recurring challenge involves distinguishing between contribution revenue and exchange transactions.

For example, revenue generated through program services may require different accounting treatment than donor contributions. Incorrect classification can affect financial statement presentation, reporting accuracy, and compliance assessments.

Given the variety of funding sources used by nonprofit organizations, revenue recognition remains an important area of audit focus.

8. Nonprofit Audit Readiness Checklist

✓ Review grant agreements and funding requirements

✓ Confirm federal expenditure calculations

✓ Reconcile restricted and unrestricted fund balances

✓ Verify revenue classifications

✓ Update governance and board documentation

✓ Complete account reconciliations

✓ Review expense allocation methodologies

✓ Prepare required financial statements

✓ Organize grant and donor support documentation

✓ Address internal control gaps before fieldwork

As compliance expectations continue to evolve, successful NFP audit compliance depends on strong financial reporting processes, proactive documentation practices, and early audit preparation. CPA firms that help clients identify and address issues before fieldwork begins are often better positioned to improve audit efficiency, reduce disruptions, and support successful engagement outcomes.

Top Compliance Challenges CPA Firms Face in 2026

As regulatory expectations continue to evolve, CPA firms are being asked to deliver higher-quality audits while managing increasingly complex compliance requirements. For firms providing Audit & Assurance Services for CPAs, maintaining technical accuracy and audit quality has become just as important as meeting engagement deadlines.

Whether performing an employee benefit plan audit or supporting nonprofit organizations, firms must navigate changing regulations, heightened scrutiny, and recurring risk areas that can impact both compliance outcomes and audit quality.

1. Audit Quality Remains a Key Regulatory Focus

Employee benefit plan audits continue to receive significant attention from regulators.

The U.S. Department of Labor’s most recent audit quality study found that approximately 30% of reviewed EBP audits contained at least one deficiency. While this represents an improvement compared to previous studies, the findings highlight the ongoing challenges firms face in maintaining consistent audit quality.

Perhaps more importantly, the study found a strong correlation between audit quality and firm experience. Firms that perform a higher volume of employee benefit plan audits generally demonstrate lower deficiency rates than firms that perform only a small number of engagements annually.

2. DOL Audit Quality Findings

30% EBP audits reviewed contained at least one deficiency
18% Major deficiency rate among firms performing 100+ EBP audits annually
25% Major deficiency rate among firms performing 25+ EBP audits annually
55% Major deficiency rate among firms performing fewer than 25 EBP audits
70% Deficiency rate among firms performing only 1–2 EBP audits

These findings reinforce the importance of specialized training, standardized methodologies, and sufficient engagement experience when performing employee benefit plan audits.

3. Common Challenges in Employee Benefit Plan Audits

Many deficiencies identified by regulators stem from recurring operational and compliance issues rather than highly technical accounting matters.

Some of the most common challenges in employee benefit plan audits include:

Late participant contribution deposits
Errors in participant eligibility tracking
Inconsistent Form 5500 reporting
Incomplete or insufficient audit documentation
Distribution and loan processing errors
Investment valuation and reporting concerns
Related-party and party-in-interest transactions
Internal control deficiencies

These areas often require auditors to evaluate not only financial records but also plan administration processes and supporting documentation.

As a result, firms performing EBP engagements must maintain a thorough understanding of both accounting requirements and ERISA compliance obligations.

4. Regulatory Scrutiny Continues to Increase

Regulators continue to place significant emphasis on accurate reporting, timely filings, and audit quality.

Form 5500 filings are subject to review by both the Department of Labor and the IRS, making consistency between audited financial statements and regulatory filings particularly important.

Late filings, incomplete information, or unresolved compliance issues can expose plan sponsors to penalties, corrective actions, and additional scrutiny. This places additional pressure on CPA firms to ensure audits are completed accurately and on schedule.

5. Common Nonprofit Compliance Challenges

While nonprofit organizations face different regulatory requirements, many of their compliance challenges are equally complex.

One recurring issue involves revenue classification. Determining whether revenue should be recognized as a contribution, grant revenue, or an exchange transaction requires careful analysis and proper documentation.

Another common challenge involves managing donor-restricted funds. Organizations must maintain clear records demonstrating how restricted contributions are received, tracked, spent, and reported.

Additional nonprofit compliance challenges often include:

Incomplete grant documentation
Weak internal controls
Delayed financial reporting
Inconsistent expense allocations
Limited segregation of duties
Inaccurate functional expense reporting

When these issues are not addressed proactively, they can create audit delays, increase the likelihood of adjustments, and complicate compliance reporting.

6. Documentation and Internal Controls Continue to Matter

Across both employee benefit plan and nonprofit audits, strong documentation remains one of the most important factors influencing audit quality.

Incomplete supporting schedules, missing approvals, inconsistent reconciliations, and weak control documentation can significantly increase audit risk and engagement complexity.

For CPA firms, developing standardized procedures and encouraging clients to address documentation requirements early can help improve efficiency while reducing compliance risks throughout the audit process.

As regulatory expectations continue to evolve, firms that invest in specialized expertise, strong audit methodologies, and proactive client communication will be better positioned to navigate the growing compliance demands of both EBP and nonprofit audit engagements.

Operational Pressures Are Reshaping Audit Delivery

While regulatory compliance remains a primary concern, many CPA firms are finding that operational challenges have become just as significant as technical audit requirements. Growing engagement complexity, talent shortages, evolving technology expectations, and seasonal workload spikes are creating capacity constraints across the profession.

For firms managing both employee benefit plan and nonprofit audit engagements, balancing quality, turnaround times, and resource availability has become increasingly difficult.

1. Talent Shortages Continue to Impact CPA Firms

The accounting profession continues to face ongoing workforce challenges. Many firms report difficulty recruiting and retaining qualified professionals, particularly in specialized service areas such as audit and assurance.

Several factors are contributing to these staffing pressures, including:

Fewer accounting graduates entering the profession
Increased retirement of experienced CPAs
Growing demand for specialized audit expertise
Competition for experienced accounting and audit talent

As a result, firms often find themselves managing increasing workloads with limited resources, particularly during peak reporting periods.

2. Audit Complexity Is Increasing

Today’s audit engagements often require more than financial statement testing.

Employee benefit plan audits may involve evaluating plan operations, participant data, eligibility requirements, investment activity, and regulatory compliance considerations. Nonprofit audits frequently require auditors to assess grant compliance, donor restrictions, revenue recognition, and functional expense allocations.

At the same time, regulatory expectations around documentation, risk assessment, and audit quality continue to evolve.

As engagement requirements become more complex, firms must dedicate additional time to planning, review, quality control, and staff training.

3. Technology Adoption Is Creating New Demands

Technology continues to transform the audit profession.

Many firms are investing in:

Audit automation tools
Data analytics platforms
Workflow management systems
Document collaboration technologies
Artificial intelligence and machine-learning applications

While these investments can improve efficiency and enhance audit quality, implementation requires significant time, training, and ongoing process improvements.

For many firms, the challenge is no longer deciding whether to adopt new technology, but determining how to integrate it effectively while maintaining productivity and service quality.

4. Seasonal Workloads Create Capacity Constraints

One of the most persistent challenges facing audit practices is workload seasonality.

Audit demand often concentrates around key reporting deadlines, including:

Form 5500 filing deadlines
Single Audit reporting deadlines
Year-end financial reporting cycles
Tax season support activities

These periods can create sharp spikes in workload that are difficult to address through permanent staffing alone.

As engagement volumes increase, firms may face difficult decisions between hiring ahead of demand, relying on overtime, delaying work, or seeking additional support resources.

5. Balancing Growth and Audit Quality

Many firms are experiencing growth in audit demand while simultaneously navigating resource limitations.

As engagement portfolios expand, maintaining consistent quality becomes increasingly dependent on effective resource allocation, standardized processes, and efficient workflow management.

Without sufficient capacity, firms may face:

Extended turnaround times
Increased staff burnout
Reduced scheduling flexibility
Delays in client deliverables
Greater pressure on managers and reviewers

These operational pressures are prompting many firms to reassess how audit work is performed and how resources are deployed across engagements.

For firms seeking sustainable growth, the challenge is not simply completing more work. It is developing a delivery model that supports audit quality, compliance, scalability, and long-term profitability while continuing to meet client expectations.

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How CPA Firms Can Prepare for EBP and NFP Audits in 2026

As compliance requirements become more complex and staffing pressures continue across the profession, preparation is becoming one of the most important factors influencing audit quality and engagement efficiency.

For firms managing employee benefit plan and nonprofit audits, successful execution often depends on actions taken months before fieldwork begins. Early planning, standardized processes, staff training, and proactive client communication can help reduce compliance risks while improving engagement outcomes.

1. Begin Audit Planning Early

One of the most effective ways to improve audit readiness is to start planning well before key filing deadlines.

For employee benefit plan engagements, many industry specialists recommend engaging auditors and beginning audit preparation several months before the Form 5500 filing deadline. Early planning provides additional time to:

Gather participant and plan data
Review internal controls
Identify potential compliance issues
Resolve documentation gaps
Coordinate with third-party service providers

Starting early can help firms avoid the bottlenecks that often occur as filing deadlines approach.

2. Request SOC 1 Reports as Early as Possible

Many employee benefit plans rely on third-party administrators, custodians, payroll providers, and other service organizations.

Obtaining SOC 1 reports from these providers is often a critical component of the audit process. However, these reports are not always immediately available and may take several weeks to obtain.

Requesting SOC 1 reports early in the engagement lifecycle can help prevent unnecessary delays and provide auditors with sufficient time to evaluate relevant controls and supporting documentation.

3. Standardize Audit Processes and Documentation

As engagement volumes grow, consistency becomes increasingly important.

Firms that rely on standardized procedures, templates, and documentation requirements are often better positioned to:

Improve audit efficiency
Reduce rework
Support quality control efforts
Simplify staff training
Enhance engagement consistency

This is particularly valuable for firms managing multiple EBP and nonprofit engagements during compressed reporting periods.

4. Invest in Technical Training

Regulatory requirements continue to evolve across both employee benefit plan and nonprofit audits.

Audit teams should remain informed about developments related to:

ERISA compliance requirements
SECURE 2.0 implementation
Form 5500 reporting obligations
Single Audit requirements
Nonprofit financial reporting standards
Audit quality expectations

Ongoing education helps firms maintain technical competency while reducing the risk of compliance issues and audit deficiencies.

5. Strengthen Client Communication

Many audit delays originate from incomplete information, missing documentation, or unresolved client questions.

Establishing clear communication timelines and expectations can help firms obtain required information more efficiently and improve overall engagement management.

Best practices often include:

Providing documentation request lists early
Scheduling planning meetings in advance
Establishing milestone deadlines
Communicating status updates throughout the engagement

A proactive approach can significantly reduce last-minute issues and improve the client experience.

6. Develop Audit Readiness Checklists

Structured checklists can help both audit teams and clients prepare for fieldwork more effectively.

For employee benefit plan audits, an EBP audit checklist may include:

✓ Participant census review

✓ Eligibility testing review

✓ Contribution and distribution reconciliation

✓ Investment verification

✓ SOC 1 report collection

✓ Form 5500 reconciliation

✓ Internal control assessment

✓ Plan amendment review

For nonprofit engagements, readiness checklists often focus on:

✓ Grant agreement review

✓ Federal expenditure calculations

✓ Restricted fund reconciliation

✓ Revenue classification review

✓ Functional expense allocation review

✓ Financial statement preparation

✓ Governance documentation updates

7. Prioritize Quality Before Deadlines

Meeting deadlines remains important, but maintaining audit quality is equally critical.

As regulatory scrutiny continues and engagement complexity increases, firms should ensure that resource planning, review processes, and quality control procedures receive the same attention as scheduling and delivery targets.

Firms that prepare early, maintain consistent methodologies, and invest in staff development are often better positioned to manage compliance requirements, improve efficiency, and deliver high-quality audit outcomes throughout the 2026 audit cycle.

Why CPA Firms Are Expanding Capacity with Offshore Audit Support

As employee benefit plan and nonprofit audits become more demanding, many CPA firms are reassessing how they allocate resources across audit engagements. Increasing regulatory requirements, staffing shortages, seasonal workload fluctuations, and rising client expectations have made capacity management a growing priority for firms of all sizes.

In response, many firms are incorporating Offshore audit support for CPA firms into their delivery models to improve scalability, strengthen operational flexibility, and support consistent audit execution.

1. Addressing Capacity Challenges Without Overhiring

One of the most significant challenges facing audit practices is balancing workload fluctuations throughout the year.

Demand often increases sharply around:

Form 5500 filing deadlines
Single Audit reporting periods
Year-end financial reporting cycles
Tax season support activities

Building permanent staffing capacity for peak workloads can be difficult, particularly when engagement volumes vary significantly throughout the year.

As a result, many firms are exploring flexible resourcing models that allow them to scale support based on workload demands while maintaining operational efficiency.

2. Supporting Audit Teams Across the Engagement Lifecycle

Offshore professionals can assist with a variety of audit-related activities, allowing in-house teams to focus on planning, review, client communication, and technical decision-making.

Depending on firm requirements, support may include:

Audit workpaper preparation
Lead schedule preparation
Financial statement drafting
Documentation organization
Account reconciliations
Testing support
Administrative audit procedures

This approach can help firms manage engagement volume more effectively while preserving valuable time for senior auditors and managers.

3. Supporting Employee Benefit Plan Audit Engagements

For firms providing Employee Benefit Plan (EBP) Audit Support, workload demands often intensify as Form 5500 deadlines approach.

Tasks such as documentation preparation, testing support, participant data organization, and workpaper preparation can require substantial time and resources.

By utilizing outsourcing EBP audit preparation services, firms can often improve workflow efficiency while allowing engagement leaders to focus on higher-value activities such as risk assessment, audit strategy, review procedures, and client advisory discussions.

4. Enhancing Nonprofit Audit Delivery

Nonprofit audits frequently involve extensive documentation requirements, grant-related reporting, restricted fund analysis, and financial statement preparation.

Additional support resources can help firms manage these requirements more efficiently, particularly during periods of increased engagement activity.

When integrated effectively, offshore professionals can operate as an extension of the firm’s existing audit team while following established methodologies, quality standards, and engagement procedures.

5. Protecting Audit Quality While Improving Scalability

Successful offshore support initiatives are not simply about reducing costs.

For many firms, the primary objective is creating additional capacity while maintaining quality, consistency, and responsiveness.

An effective support model can help firms:

Improve resource utilization
Reduce turnaround times
Increase scheduling flexibility
Support engagement growth
Reduce pressure on internal teams
Maintain focus on quality control and review processes

As audit requirements continue to evolve, scalable resource strategies are becoming an increasingly important component of long-term practice management.

6. Building a Sustainable Audit Delivery Model

The challenges facing CPA firms in 2026 are unlikely to disappear in the near future. Regulatory expectations continue to increase, competition for talent remains strong, and clients expect both technical excellence and timely service.

As a result, firms are increasingly evaluating how technology, process improvements, and strategic resourcing can work together to support sustainable growth.

For many firms, offshore support has become one component of a broader strategy designed to strengthen audit & assurance solutions, improve operational resilience, and create the capacity needed to serve clients effectively in an increasingly complex audit environment.

Conclusion

The compliance landscape for employee benefit plan and nonprofit audits continues to evolve in 2026. From ongoing SECURE 2.0 implementation and ERISA audit requirements to updated nonprofit audit thresholds and increasing audit quality expectations, CPA firms are navigating a more demanding environment than ever before.

At the same time, staffing shortages, seasonal workload spikes, and growing engagement complexity are placing additional pressure on audit teams. Firms that prioritize early planning, standardized processes, technical training, and effective resource management will be better positioned to maintain compliance, deliver quality engagements, and support client needs.

For firms seeking additional audit capacity, Unison Globus provides specialized support through its Audit & Assurance Services for CPAs, including Employee Benefit Plan (EBP) Audit Support, nonprofit audit assistance, workpaper preparation, testing support, and other audit-related functions. By serving as an extension of your team, we help firms manage workload fluctuations, improve operational efficiency, and maintain focus on high-value client and review activities.

Looking to strengthen your EBP and NFP audit capacity in 2026? Contact Unison Globus to learn how our offshore audit support solutions can help your firm scale with confidence.

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Audit & Assurance Auditing

Employee Benefit Plan (EBP) Audits: Planning Early to Avoid Compliance Risks

Post author By unison_globus
Post date May 7, 2026

If July 31 isn’t already flagged in your firm’s calendar, now is the time. For CPA firms managing multiple clients with calendar-year plans, the Form 5500 filing deadline arrives faster than it should, and the firms that feel it most are the ones that waited too long to start.

Employee benefit plan audits are one of the most technically demanding, deadline-sensitive engagements in public accounting. They require deep ERISA audit support, meticulous documentation, and careful coordination across multiple parties. And in 2026, with SECURE 2.0 changes still rippling through plan operations and regulators sharpening their focus on compliance accuracy, the stakes are higher than ever.

This is not the season to wing it.

Why EBP Audit Season 2026 Is Different

Every year brings its share of EBP audit complexity. But 2026 has added a few new layers that CPA firms need to account for, literally and figuratively.

SECURE 2.0 Is Still Reshaping Plan Operations

The SECURE 2.0 Act continues to drive operational changes across 401(k), 403(b), and defined benefit plans. Updated catch-up contribution rules, revised eligibility tracking requirements, and new amendment deadlines mean plan sponsors are navigating a moving target, and auditors need to keep pace.

For CPA firms, this means EBP audit planning for CPA firms that worked cleanly last year may need adjustment. Workpapers need to reflect current law. Testing approaches need to account for mid-year changes. And staff need to be briefed before fieldwork begins, not during it.

Regulatory Scrutiny Is Up

The Department of Labor and the IRS are not easing up. In 2026, regulators continue to emphasize operational accuracy and documentation consistency, with recurring focus areas including late participant contribution deposits, inconsistent Form 5500 reporting, eligibility tracking errors, and insufficient internal control documentation.

The DOL has also long flagged high deficiency rates among auditors who do not regularly perform ERISA compliance audits. If your firm is taking on EBP engagements without dedicated expertise or support, that is a compliance risk for your clients and for your firm.

The July 31 Deadline Is Closer Than It Looks

For calendar-year plans, the EBP audit deadline for the United States standard is July 31, 2026. An extension via Form 5558 pushes that to October 15, but extesnsions are not a strategy; they are a safety nest. And with employee benefit plan audits taking three to four months from engagement to final report, firms starting in May are already working with a tight window.

What Makes EBP Audits So Demanding for CPA Firms

Understanding the pressure points is the first step to managing them. Employee Benefit Plan (EBP) Audit Support looks structurally different from standard financial statement audits, and the documentation demands alone can derail an unprepared team.

Multi-Party Coordination Takes Time

EBP audits involve more moving parts than most engagements. The plan sponsor, recordkeeper, custodian, investment advisor, and third-party administrator all play a role, and getting information from each of them takes time your team may not have budgeted for.

SOC 1 reports from service providers, for example, can take four to six weeks to obtain. If your team requests them in June, you are already behind.

Document Volume Is Substantial

A thorough EBP audit requires plan documents and all amendments, the IRS determination or opinion letter, the trust agreement, the Summary Plan Description, service provider contracts, year-end financial statements, payroll reconciliations, and participant-level transaction data. That is before fieldwork even begins.

For firms managing five, ten, or fifteen EBP clients simultaneously, the document management burden alone can stretch a team to its limits.

Participant-Level Testing Is Labor Intensive

Unlike a standard audit, EBP audit services USA procedures require participant account testing, verifying contributions, distributions, loans, eligibility, and vesting across individual participant records. For large plans, this is a significant time investment that requires both technical accuracy and ERISA fluency.

Capacity Peaks Collide

EBP audit season lands right after tax season, which means the same staff that just wrapped April 15 engagements are expected to pivot immediately into intensive plan audit work. For many CPA firms, especially small and mid-size practices, this capacity crunch is the single biggest threat to EBP audit quality and on-time delivery.

The Real Cost of Starting Late

Late EBP audit planning does not just create internal stress; it creates compliance exposure.

Missing the July 31 Form 5500 filing deadline without an approved extension triggers DOL and IRS penalties that can reach $250 per day. Incomplete filings, particularly those missing required audit attachments, frequently invite regulator correspondence and additional scrutiny. And findings that require retroactive corrections cost far more in time, fees, and client trust than proactive preparation would have.

For CPA firms, a delayed or deficient ERISA compliance audit engagement also carries reputational risk. Clients expect their auditors to be the steady hand in a complex process. Showing up underprepared is not a position any firm wants to be in, especially with DOL compliance testing drawing increased attention in 2026.

Your July 31 deadline is closer than it looks. Partner with
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How CPA Firms Can Get Ahead of EBP Audit Season

The good news: if your firm is acting in May, you are not too late. But the window for comfortable preparation is narrowing. Here is what early planning actually looks like in practice.

Confirm Your EBP Audit Client List Now

Start by identifying every client that requires an employee benefit plan audit for the 2025 plan year. Pay particular attention to plans approaching the 100-participant threshold. First-time audit requirements carry their own set of complexities and onboarding demands.

For plans in the 80 to 120 participant range, confirm whether the prior-year filing status allows deferral or triggers an immediate audit requirement. Do not assume, verify.

Get Engagement Letters and Document Requests Out Immediately

Every week of delay at the front end compresses the timeline at the back end. Send engagement letters, establish internal contacts at each plan sponsor, and issue your document request lists now. The sooner your clients start gathering materials, the smoother the fieldwork will run.

Request SOC 1 Reports Without Delay

This is the step most firms underestimate. SOC 1 reports for recordkeepers, custodians, and TPAs are essential to EBP audit procedures, and they take weeks to arrive. Requesting them in May gives you a reasonable buffer. Requesting them in June does not.

Run Discrimination Testing Early

ADP/ACP testing for Actual Deferral Percentage and Actual Contribution Percentage is another area where late action creates downstream problems. Getting this done early means corrections, if needed, can be processed without deadline pressure compounding the complexity.

Assess Your Firm’s Internal Capacity Honestly

How many EBP audits can your current team realistically handle between now and July 31? Factor in review time, client communication, and the inevitable back-and-forth on missing documents. If the honest answer is fewer than your client list requires, that is not a failure of planning. It is a signal that additional support is needed.

Why CPA Firms Are Turning to Outsourced EBP Audit Support

Across the US, CPA firms of all sizes, from growing solo practices to established regional players, are increasingly partnering with offshore EBP audit services specialists to manage capacity, maintain quality, and meet deadlines without burning out their teams.

Outsourced EBP audit support is not about replacing your CPAs. It is about giving them the bandwidth to do what they do best: review, advise, and sign off, while a trained offshore team handles the documentation-heavy, time-intensive groundwork.

Here is what that looks like across firm sizes:

Small CPA firms growing their EBP audit practice remove the capacity ceiling that limits how many clients they can serve
Mid-size firms managing seasonal overflow get a flexible, reliable extension of their existing team
Larger firms seeking cost-efficient output at scale get high-quality, audit-ready deliverables without the overhead

What Unison Globus Covers

Unison Globus provides Employee Benefit Plan (EBP) Audit Support focused on ERISA and regulatory requirements, built specifically around the way CPA firms operate. Here is the full scope of what we support:

Core EBP Audit Support

Audits of 401(k), pension, and defined contribution or defined benefit plans across all plan types
Testing support for participant data, contributions, distributions, and plan activity
Preparation of audit schedules and internal control documentation
Coordination with plan administrators, custodians, and third-party service providers

Additional EBP Audit Services

Form 5500 Support: Preparation, review, and reconciliation assistance for Form 5500 filings
DOL Compliance Testing: Testing aligned with Department of Labor compliance requirements
SOC 1 Report Reviews: Review and documentation of SOC 1 reports for plan custodians and recordkeepers
Discrimination Testing Support (ADP/ACP): Assistance with Actual Deferral Percentage and Actual Contribution Percentage testing

Your CPAs retain full control of every engagement. Unison Globus extends your capacity, not your liability.

Why Unison Globus

Unison Globus is not a general accounting outsourcing firm that happens to offer EBP audit support. It is a dedicated audit & assurance solutions partner built specifically for Audit & Assurance Services for CPAs across the United States.

Our team brings hands-on experience in US GAAS standards, ERISA requirements, and the exacting documentation expectations that define quality employee benefit plan audits. Every deliverable we produce is formatted, labeled, and review-ready from day one, so your senior staff spends their time on judgment calls, not chasing paperwork.

We work with firms of all sizes. Whether you are a small practice taking on EBP audit planning for CPA firms for the first time, a mid-size firm looking for dependable outsourced EBP audit support, or a larger firm building a scalable employee benefit plan audit outsourcing model, Unison Globus fits into your workflow without friction.

The July 31 deadline is eleven weeks away. We are ready to onboard now.

Start Your EBP Audit Planning Today

The firms navigating EBP audit season smoothly in 2026 are the ones making decisions right now, not in June, and certainly not in July.

If your CPA firm is looking to strengthen its employee benefit plan audits practice, manage seasonal capacity, and deliver consistent, compliant results for your clients, Unison Globus is ready to support you.

Get in touch with the Unison Globus team today and find out how our offshore EBP audit services can help your firm stay ahead of the deadline and the competition.

Get Ahead of the July 31 Deadline with Expert EBP Audit Support

Partner with Unison Globus to eliminate documentation gaps, ensure ERISA compliance, and deliver high-quality audits on time.

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Audit & Assurance Auditing

How CPA Firms Use Offshore EBP Audit Support to Meet the July 31 ERISA Deadline Without Burnout

Post author By unison_globus
Post date April 13, 2026

The Department of Labor rejects nearly 1 in 3 EBP audit reports it reviews due to quality deficiencies. Not because CPA firms lack technical knowledge, but because these engagements demand a level of preparation and coordination that is difficult to sustain during peak season.

July 31 does not move. Your team’s bandwidth does.

EBP Audits Are Not Just Another Assurance Engagement

Most audit work follows a rhythm. Employee Benefit Plan audits follow one too, but it is far less forgiving.

Plans with 100 or more participants require an annual audit, filed alongside Form 5500 seven months after the plan year ends. For most calendar year plans, that deadline lands on July 31. On paper, it seems manageable. In practice, firms are often handling multiple engagements at once, all with identical deadlines and documentation requirements.

This is where Employee Benefit Plan (EBP) Audit Support becomes essential, and why many firms begin to rely on Employee Benefit Plan audit outsourcing as their EBP client base grows.

The challenge is not the testing itself. Teams experienced in delivering Audit & Assurance Services for CPAs are well-equipped to handle that phase. The pressure builds much earlier, in the preparation work that must be completed before testing can even begin.

Census data arrives incomplete or unreconciled. SOC 1 reports must be obtained, reviewed, and documented. Contribution schedules require detailed tracing across payroll runs. Workpapers need to be structured and formatted to support review. Plan documents must be aligned with actual operations.

Even within 401(k) audit support services, the level of coordination required across payroll systems, trustees, and participant records can slow progress long before the audit formally begins.

Individually, these tasks are manageable. Together, across multiple engagements, they create a steady drain on time and attention that is easy to underestimate and difficult to recover from once deadlines begin to close in.

The Real Cost Is Not the Deadline. It Is What Happens to Your Team

The strain of EBP season rarely shows up all at once. It builds gradually.

Senior staff begin picking up preparation work that should have been completed earlier. Review timelines compress as testing starts later than planned. Attention to detail becomes harder to maintain when everything is happening at once.

This is where ERISA audit support becomes more than a convenience. It becomes a way to protect both quality and team capacity.

When preparation, testing, and review phases begin to overlap, the entire engagement gets compressed into a window that is too narrow for the work to be done at its best. Reviewers have less time to evaluate documentation thoroughly. Issues surface later than they should. The audit is completed, but with less margin for error than anyone is comfortable with.

Firms that rely solely on internal teams for every stage of the process often find themselves using highly experienced staff for work that does not require their level of judgment, while increasing the risk of missed details in the process.

This is not a question of effort. It is a question of structure, and whether the firm has the right audit & assurance solutions in place to support the workload.

Take control of your EBP timeline
before it starts controlling your team.

Reach out Now!

Why Offshore EBP Audit Services Fit the Way These Engagements Actually Work

The shift toward offshore support for CPA firms has become less about experimentation and more about practical necessity.

EBP engagements, in particular, are well suited for this model because so much of the workload sits in structured preparation. Tasks such as census reconciliation, SOC documentation, contribution tracing, and workpaper organization require consistency, accuracy, and familiarity with EBP requirements, but not constant client interaction or partner-level oversight.

This is what makes offshore EBP audit services effective when they are set up correctly.

Preparation work is completed in advance by teams that understand what an audit-ready file should look like. By the time the engagement moves into testing, your internal team is working with clean, organized documentation instead of building it under time pressure.

For many firms, this naturally evolves into a broader CPA firm EBP audit outsourcing model, where preparation is consistently handled outside the core team, allowing internal resources to stay focused on higher-value work.

Time zone differences also become an operational advantage. Work handed off at the end of the day can be ready for review the next morning, helping teams maintain momentum during the busiest parts of the season.

From a cost perspective, the model is equally practical. Senior staff time is best used on analysis, review, and client communication. Shifting preparation work to a dedicated offshore team allows firms to use their resources more efficiently without compromising quality.

What Working With Unison Globus Looks Like

For more than 19 years, Unison Globus has supported accounting firms with audit & assurance solutions designed around real engagement workflows. Our approach to expert CPA audit services reflects the way firms actually operate during peak periods.

Firms working with us for Employee Benefit Plan audit outsourcing can expect a structure built around clarity, consistency, and reliability.

Our teams include qualified CAs, CPAs, and specialists who understand ERISA requirements, Department of Labor expectations, and the level of documentation needed for a clean audit file. Every engagement is handled with a clear understanding of what your reviewers and partners expect to see.

We integrate directly into your existing systems, using your templates and aligning with your internal processes. The goal is not to change how your team works, but to support it in a way that feels seamless. When your staff picks up a file, it is organized, complete, and ready for the next stage.

Data security is managed through ISO/IEC 27001:2022 certified systems, with strict protocols in place to ensure confidentiality and continuity across all engagements.

Our delivery model is built around fixed timelines, with dedicated teams assigned to each engagement to maintain consistency and accountability. As your EBP portfolio grows, our support scales with you, allowing you to adjust capacity without restructuring your internal team.

The Firms That Plan Ahead Own the Season

EBP audits are becoming more demanding. Regulatory scrutiny continues to increase, documentation standards are tighter, and more plans are crossing the threshold that requires an audit.

The firms that manage this well are not necessarily the largest. They are the ones that understand where time is spent and make deliberate decisions about how that time is used.

They ensure preparation is handled early and consistently. They build workflows that deliver clean files into the testing phase. They allow senior staff to focus on areas where their expertise has the greatest impact.

In many cases, that includes integrating offshore audit support for CPA firms as part of a broader, more sustainable approach to audit delivery.

This is not about changing how audits are performed. It is about structuring the work so it can be completed at a high standard without putting unnecessary strain on the team.

If your firm is already looking at EBP season and thinking about how to stay ahead of the workload, now is the time to put the right support in place. Working with Unison Globus allows you to approach the July 31 deadline with a clearer structure, stronger preparation, and a team that is not constantly playing catch-up.

Let’s talk about your EBP season

Reach out Now!

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