*The New York Post is reporting that an internal audit of Al Sharpton’s National Action Network found the civil rights organization woefully negligent in its record-keeping and teetering on the brink of survival.

“The organization has suffered recurring decreases in net assets — and has been dependent upon advances from related parties and the nonpayment of payroll tax obligations — to maintain continuity,” the firm KBL concluded in an April 2 audit of NAN’s 2008 financial records, the most recent available.

The audit, which was submitted to NAN’s board of directors, warned, “These circumstances create substantial doubt about the organization’s ability to continue.”

KBL said it was “unable to form an opinion” on the accuracy of NAN’s financial figures “because of inadequacies in the organization’s accounting records.”

In 2008, federal prosecutors decided to drop a criminal probe into the finances of Sharpton and NAN. But Sharpton — who also has a lucrative syndicated radio show and a speech-making and consulting business — agreed to pay back more than $2 million in overdue personal and NAN taxes, the Post reports.

The audit said NAN still owed $1.348 million in delinquent city, state and federal taxes and penalties at the end of 2008. The IRS has filed dozens of liens against NAN over the past decade, including one as recently as April of this year.

Last year, the Federal Elections Commission slapped Sharpton with $285,000 fine, in part for illegally using NAN funds to cover the costs of his 2004 presidential campaign. Sharpton, the founding president and CEO of NAN, said NAN’s finances have improved since the recent audit of its 2008 records.

“We determined not to file bankruptcy but to make NAN solvent, which we clearly have done and will be reflected in [upcoming reports],” said NAN spokeswoman Rachael Noerdlinger.

Sharpton and NAN’s board of directors put up “over seven figures” to begin paying down tax arrears, she said. “By the end of the calendar year 2010, there will be no tax liabilities as per our agreement in ’08 with tax authorities,” the spokeswoman added.

Meanwhile, the audit found that NAN was a defendant in five lawsuits. Among them:

* Alpha International Travel accused the group of failing to pay $50,000 in outstanding bills. NAN settled the case.

* The Peabody hotel in Memphis, where NAN held its 2008 convention, accused NAN of stiffing it out of $70,000. NAN is contesting the charges.

*NAN’s Arizona chapter is accused of being a deadbeat tenant. The organization is fighting the claim.