CRA Charities Audit — Montreal CPA Firm Near You: Keep Registration Secure

A CRA Charities Audit is a specialized compliance review of registered charities, foundations, and non-profit organizations (NPOs) to ensure that funds are used exclusively for approved charitable purposes. These audits test more than bookkeeping accuracy — they evaluate mission integrity, governance, receipting, and the public benefit of every dollar spent.
Mackisen CPA Montreal provides full audit defense and compliance support for charities facing CRA or Revenu Québec review, helping organizations protect their registration, reputation, and community trust.

Legal Foundation

Law: Income Tax Act s.149.1 — defines rules for registered charities and eligible activities; Charities Registration (Security Information) Act; Tax Administration Act (QC) s.34–36.
Jurisprudence: Human Life International in Canada Inc. v. MNR (1998 FCA) — established that charities must devote resources exclusively to charitable activities and avoid political or profit-oriented purposes.

Learning insight: A charity’s credibility is not proven by its donations — it’s proven by its documentation.

Why CRA Conducts Charities Audits

The CRA Charities Directorate monitors over 85,000 registered organizations across Canada. Its audit division targets those with anomalies in annual filings, suspicious receipting patterns, or governance red flags.
Common CRA triggers include:

• Incomplete or inconsistent Form T3010 filings.

• Excessive fundraising or administrative spending.

• Issuing donation receipts for ineligible gifts or inflated amounts.

• International transfers of funds without control documentation.

• Political or advocacy activities outside permitted limits.

• Rapid asset accumulation without charitable disbursement.

Learning insight: CRA doesn’t audit generosity — it audits governance. Mackisen CPA ensures your books reflect your mission.

How CRA Charities Audits Work

1. Desk Review: CRA analyzes filings, financial statements, and donation receipts.

2. Field Audit: Officers visit your premises to review ledgers, minutes, and program activities.

3. Preliminary Letter: CRA lists proposed concerns and requests explanations.

4. Final Decision: CRA either accepts the explanations or proposes deregistration, penalties, or education measures.

Learning insight: Transparency ends most audits early. Silence extends them indefinitely.

What Mackisen CPA’s Charities Audit Defense Includes

• Receipting Review: Verify that all receipts meet ITA s.3501 regulations.

• Program Activity Analysis: Match expenditures to approved charitable purposes.

• Governance and Board Review: Confirm proper bylaws, conflict-of-interest policies, and records.

• Foreign Activity Documentation: Ensure control of international funds meets CRA’s direction-and-control requirements.

• Charitable Status Preservation Plan: Prepare compliance strategy to correct any deficiencies before CRA finalizes findings.

Learning insight: A CRA audit letter is not a crisis — it’s an opportunity to prove professionalism and stewardship.

Common Problems Detected in CRA Charities Audits

• Missing donation receipts or duplicated numbers.

• Third-party fundraising without oversight.

• Charitable funds used for political or profit-making ventures.

• Unrecorded or undocumented transfers to foreign affiliates.

• Poor segregation between charitable and non-charitable activities.

• Late or missing T3010 annual information returns.

Mackisen CPA Montreal builds a defense file with every receipt, board minute, and financial schedule aligned to CRA’s Charities Directorate Compliance Guidelines.

Learning insight: CRA deregisters organizations for lack of structure, not lack of goodwill. Mackisen CPA gives your charity both.

CRA Penalties and Consequences

When CRA detects violations, it can impose:

• Suspension of receipting privileges (up to 1 year).

• Financial penalties for improper receipts (5–10% of issued amounts).

• Revocation of charitable status.

• Deregistration tax equal to all remaining assets.

Learning insight: Losing charitable status means losing donor confidence. Mackisen CPA preserves both through proactive governance support.

CRA Educational vs. Enforcement Outcomes

Charities audits may end in one of two paths:

1. Education Letter: Minor issues corrected voluntarily.

2. Compliance Agreement: Significant deficiencies fixed under monitoring.

3. Sanctions or Revocation: For repeated or deliberate non-compliance.

Mackisen CPA helps charities move from enforcement to education outcomes by demonstrating intent, transparency, and corrective action.

Learning insight: CRA rewards cooperation — not confrontation. Our firm translates compliance into collaboration.

SEO Optimization and Learning Value

Primary Keywords: CRA Charities Audit, Registered Charity Compliance Canada, Mackisen CPA Montreal, CPA Firm Near You, Charity Deregistration Defense.
Secondary Keywords: CRA T3010 filing errors, nonprofit audit Canada, Revenu Québec charity review, charitable governance audit, donation receipt compliance.

Learning insight: Search traffic thrives on expertise. CRA trusts documented accuracy; Google rewards educational clarity — Mackisen CPA delivers both.

Real Client Results

• A Montréal humanitarian charity avoided deregistration after Mackisen CPA proved its overseas transfers met CRA direction-and-control tests.

• A community foundation resolved a $240,000 receipting discrepancy when we reconstructed donor logs from financial records.

• A private educational trust maintained status after Mackisen CPA restructured governance and separated charitable from business activities.

Learning insight: Charities don’t fail audits — they fail preparation. Mackisen CPA transforms passion into compliant accountability.

Why Mackisen CPA Montreal

For over 35 years, Mackisen CPA Montreal has supported registered charities, NGOs, and foundations in Québec and across Canada with audit defense, T3010 filing, and governance restructuring. Our bilingual CPA team specializes in CRA and ARQ compliance, ensuring your charitable mission continues without interruption.
We help organizations meet CRA expectations, educate boards on fiduciary duties, and maintain transparent donor reporting systems.

Learning insight: A charity’s heart is its mission; its backbone is compliance. Mackisen CPA keeps both strong.