OMB Extends Single-Audit Deadlines for Recipients of COVID-19 Funding
In December 2020, the Office of Management and Budget (OMB) issued new guidance on single audits in the form of an addendum to the 2020 OMB Compliance Supplement.
For organizations that received some form of COVID-19 funding, OMB is providing a three-month audit submission extension for single audits of 2020 year-ends through September 30, 2020. This means that a single audit with a June 30, 2020 year-end is now due on June 30, 2021 (instead of March 31, 2021).
COVID-19 funding can include CARES Act funding that is part of new or fiscal year 2021 state grants received by the organization during the year, as well as a majority of the direct funding from the U.S. Department of Health & Human Services and the U.S. Treasury that has been passed to the state and, eventually, nonprofit organizations.
Additionally, the addendum answered other questions related to new COVID-19 funding, including those established by the CARES Act.
- Provider Relief Fund expenditures and lost revenue will not be included on the Schedule of Expenditures and Federal Awards (SEFA) until Dec. 31, 2020, year-ends and later. This timing only affects the Provider Relief Fund program and does not apply to other COVID-19 funding that health care entities may have received.
- Nonfederal entities that received donated personal protective equipment (PPE) should include the fair market value of the PPE at the time of receipt in a stand-alone footnote to the SEFA that can be marked “unaudited.” The auditor should not count the donated PPE for purposes of determining the threshold for a single audit or determining the Type A/B program threshold for major programs. Donated PPE is not required to be audited as a major program.
- A matrix of compliance requirements in the addendum identifies the requirements subject to audit for all new programs, as well as existing programs that are included in the addendum.
- Detailed information on new and existing programs is included in agency program requirement sections in the addendum. But there are other existing programs affected by COVID-19 that are not included in the addendum. For practitioners auditing an existing federal program that received funding under the CARES Act that is not included in the supplement addendum, the GAQC advises referring to Appendix VII of the August 2020 Supplement for guidance.
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