How are audits conducted and who is eligible to perform them?

• A. Random spot checks by any member.
• B. Audits are not required.
• C. Annual or periodic audits by qualified individuals/boards with reporting.
• D. Audits must be conducted by external certified public accountants only.

Answer: (C)

Audits are formal, documented reviews of an organization’s finances to verify accuracy, compliance, and proper use of funds. The best choice reflects the standard practice: audits happen on a regular schedule (annually or at other set intervals) and are carried out by people who are qualified, which can include internal audit personnel or an appropriate board, with a written report produced. This setup provides independent oversight and transparent communication to members or the governing body.

Other approaches fall short because random spot checks by any member lack the formal structure and independence audits require; saying audits aren’t required removes essential oversight; and insisting only external certified public accountants may perform audits is too restrictive, since qualified internal auditors or a designated audit board can fulfill the requirement when allowed by the bylaws.