NC IOLTA Responds to OSA Performance Audit Report, Affirms Strong Stewardship of IOLTA Funds

NC IOLTA Responds to OSA Performance Audit Report, Affirms Strong Stewardship of IOLTA Funds

April 22, 2026, Raleigh, N.C.: The North Carolina State Bar and NC IOLTA (North Carolina Interest on Lawyers’ Trust Accounts) have responded to the release of the report from the North Carolina Office of State Auditor (OSA) following a monthslong performance audit of the IOLTA Program, which has funded civil legal aid in North Carolina since 1983.

State Bar Executive Director Peter Bolac said, “We’re pleased to share that the report demonstrates NC IOLTA’s steady, focused commitment to achieving our mission with the highest standards for how we work. The audit affirms that our grantmaking meets all eligibility requirements. We welcome opportunities to further strengthen how we measure and report the impact of this important work.”

The audit began in August 2025 and concluded in April 2026. The audit scope originally included the State Bar’s disciplinary program as well as the Bar’s overall finances but was later narrowed to include only NC IOLTA’s grantmaking procedures and oversight of grantees’ use of funds. The report offers two areas for improvement — expansion of measurable outcomes-based goals in grant applications and stricter monitoring procedures of grantee use of IOLTA funds — and recommends NC IOLTA staff present proposed changes in procedures to the program’s Board of Trustees within six months.

State Bar and NC IOLTA leadership’s formal response to OSA’s findings is part of the report, which is available online. In the response, the State Bar and NC IOLTA identify specific proposals to build on and further strengthen the program’s existing processes.

“Since the program’s inception in 1983, our board and staff have strived to follow best practices as an IOLTA program and funder,” NC IOLTA Executive Director Mary L. Irvine said. “We were gratified to have the opportunity to demonstrate that commitment — and our adherence to all current NC IOLTA regulations — throughout the audit. We believe this transparent and open process has provided the Office of State Auditor with a clear and thorough understanding of our important work and will result in an even stronger program going forward.”

“We share the Office of State Auditor’s goal of ensuring that IOLTA funding goes exclusively toward providing civil legal services to North Carolinians who can’t afford them,” Bolac said. “With this shared goal in mind, we’re looking forward to making updates and thank the Office of State Auditor for their partnership in this productive audit process.”

The OSA’s report comes as the North Carolina General Assembly’s one-year freeze on NC IOLTA grantmaking, enacted in July 2025, stretches into the second quarter of the funding year. The loss of anticipated NC IOLTA funding for 2026 has led to budget shortfalls for legal aid organizations, which are often the only providers of free civil legal services in rural and high-poverty communities. NC IOLTA and State Bar leadership continue to seek a resolution to reopen funding opportunities for the providers of these services.

Learn more about NC IOLTA and find additional information at nciolta.org/media-resources.