Common questions that many entities receiving federal grant funding may ask are what is a Single Audit and do I need to have one? A Single Audit is used to determine if recipients of federal funds are in compliance with certain federal program requirements. A Single Audit is required for an entity that expends at least $750,000 in federal funding during their fiscal year. The OMB increased the Single Audit threshold from $750,000 to $1,000,000, which is effective for auditees with fiscal years beginning on or after October 1, 2024. This generally means that the new threshold will be in effect for any auditee with a fiscal year end of September 30, 2025, or later.

A Single Audit report will include the financial statements, the schedule of expenditures of federal awards (SEFA), the auditors’ report on internal controls over financial reporting and on compliance and other matters, the auditors’ report on compliance for each major program and on internal control over compliance required by the Uniform Guidance, and the schedule of findings and questioned costs.

The following is a brief description of the required items mentioned above:

• SEFA: lists all the expenditures of federal awards for the fiscal year
• auditors’ reports: evaluate internal controls related to federal funding, give an opinion on the compliance requirements in relation to major programs
• schedule of findings and questioned costs: lists major programs, describes any findings and noncompliance found in the audit

One common misconception is when an entity receives an amount greater than the Single Audit threshold but does not expend more than the threshold in a year. For example, say the organization received $1,500,000 in federal funds but has only spent $500,000 by the end of the year. Would they be required to have a Single Audit? The answer is no, a Single Audit is not required; however, auditors will want to be very confident in the amount the organization says they expended in order to stay compliant.

Once a Single Audit is completed, the reporting package (also called the “data collection form”) must be submitted to the Federal Audit Clearinghouse. This is due within 30 days after receipt of the audit report or 9 months after the fiscal year end date, whichever is earlier.