How Can My Nonprofit Be Prepared for a Data Security Audit?

Best Practices, Data-Ops

Melanie Lynch • May 12, 2025

In today’s digital world, data security isn’t just a catchphrase—it’s essential. Especially for organizations that handle sensitive donor or patient data, the stakes are high. Whether your nonprofit is preparing for a formal data security audit, a HIPAA compliance check, or simply wants to be proactive, having a solid plan in place will make all the difference.

As federal regulations around data privacy and protection tighten, including proposed updates to the HIPAA Security Rule in early 2025, nonprofits are expected to adopt stronger safeguards. The updates aim to enhance encryption standards, mandate multi-factor authentication (MFA), and require formalized vendor oversight and risk assessments. If this all sounds overwhelming, you're not alone. But you're also not without help.

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Step 1: Understand What Auditors Will Look For

Auditors want to see that your nonprofit is:

Limiting access to sensitive data (minimum necessary access)
Using MFA and strong passwords
Maintaining audit logs and incident response plans
Ensuring third-party vendors are vetted and secured with contracts like Business Associate Agreements (BAAs)
Conducting regular risk assessments and documenting findings

For HIPAA-covered organizations, auditors will also expect a clear data retention and destruction policy, training programs for staff, and a formal review of any software or tools used to handle Protected Health Information (PHI).

Step 2: Assess Your Infrastructure and Policies
Take stock of what systems you use:

Where is your data stored? (Cloud storage? Local servers?)
Who has access to what?
Do you use encrypted devices and secure transfer methods (like HIPAA-compliant VPNs)?
Are your vendors compliant?

This is also a good time to review whether your organization uses outdated software, lacks logging, or has unclear user access policies — all common audit red flags.

Step 3: Team Up with a Partner Who Gets It

That’s where Donlon Agency comes in.

We specialize in helping nonprofits, hospitals, and university fundraising teams stay compliant while making the most of their data, and not making things overly complicated. We understand that you don’t have unlimited resources or a security team on call 24/7. That’s why our approach is simple, secure, and tailored to how you actually work.

At Donlon, we:

Process sensitive donor and patient data in HIPAA-compliant environments
Maintain internal-only tools and encrypted workstations
Conduct annual security risk assessments and policy reviews
Require BAAs from every vendor we work with
Participate in ongoing HIPAA training and documentation

We’re also preparing for a full SOC 2 audit to deepen our security posture and demonstrate the standards our nonprofit clients can trust.

Step 4: Build a Culture of Security

Even the best tech won’t matter if your team doesn’t know how to handle data securely. That’s why Donlon emphasizes staff training, simple policies, and regular internal check-ins. We have declared each June to be Data Security Awareness Month, as just one example of how we keep our policies front-of-mind.

Final Thoughts

A data security audit doesn’t have to be a source of stress. With the right preparation and a partner like Donlon Agency by your side, your nonprofit can build a secure, compliant, and trustworthy data strategy that protects your donors, your mission, and your peace of mind.

Want help preparing for an upcoming audit? Let’s talk. Donlon Agency is here to support nonprofits through every step of the data protection journey.

Melanie Lynch

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Best Practices

How Can My Nonprofit Be Prepared for a Data Security Audit?

In today’s digital world, data security isn’t just a catchphrase—it’s essential. Especially for organizations

Best Practices

How Can My Nonprofit Be Prepared for a Data Security Audit?

In today’s digital world, data security isn’t just a catchphrase—it’s essential. Especially for organizations

View All

How Can My Nonprofit Be Prepared for a Data Security Audit?

Insights to help your organization grow

Step 1: Understand What Auditors Will Look For

Step 2: Assess Your Infrastructure and Policies
Take stock of what systems you use:

Step 3: Team Up with a Partner Who Gets It

Step 4: Build a Culture of Security

Final Thoughts

Excepteur sint occaecat cupidatat non proident dolor

How Can My Nonprofit Be Prepared for a Data Security Audit?

How Can My Nonprofit Be Prepared for a Data Security Audit?

Get in touch

Contact us about how we can do great work together.

How Can My Nonprofit Be Prepared for a Data Security Audit?

Insights to help your organization grow

Step 1: Understand What Auditors Will Look For

Step 2: Assess Your Infrastructure and PoliciesTake stock of what systems you use:

Step 3: Team Up with a Partner Who Gets It

Step 4: Build a Culture of Security

Final Thoughts

Excepteur sint occaecat cupidatat non proident dolor

How Can My Nonprofit Be Prepared for a Data Security Audit?

How Can My Nonprofit Be Prepared for a Data Security Audit?

Get in touch

Contact us about how we can do great work together.

Step 2: Assess Your Infrastructure and Policies
Take stock of what systems you use: