Federal Grants and New Audit Requirements
By Kylie Thomas
There may be nuances and other options depending on the grant award and federal agency, but generally, a single audit is required if $750,000 (or more) of federal awards are spent during your fiscal year. A single audit is a comprehensive audit of not only financial statements but grant compliance and controls over compliance as well.
Its important to note that the threshold is generally dependent on expenditures, and therefore, it is possible to receive more than $750,000 and not have a single audit requirement.
Understand the Source of the Funds
It's also important to note that not all grant agreements will readily identify themselves as being federal, especially when the funds are being passed through intermediaries such as state and local governments. Further, its always a good idea to check with the grantor on the source of the funds. Note that this also includes federal non-cash assistance (donated food, property, etc.) as well.
Pace with the Changes
While the threshold is currently $750,000, the Office of Management and Budget (OMB) recently released proposed revisions to the Uniform Guidance which included a proposition to increase the single audit threshold to $1,000,000. Many believe the proposed change will be accepted, however the timing and ultimate outcome is unknown at this point.
If you find that you are subject to new audit requirements, we recommend that you discuss with your auditor or accountant. If you have any further questions, please reach out to CSH and we will be happy to help.
