TJT in conjunction with RPG Solutions will be hosting a seminar on Post Election Healthcare Reform...
More Business and Organizations Subject to Single Audit Requirements as a Result of COVID Relief Funding
During the pandemic, many for-profit business and non-profit organizations received economic relief through various federally funded sources of money. However, the type of funding may trigger a requirement for a specialized audit called a Single Audit. Many of these entities were not previously subject to the Single Audit because they did not receive federal funding.
A Single Audit is an audit of federal awards for an organization that generally expends $750,000 or more in federal funds in one year. A Single Audit may require 1) an audit of the financial statements and 2) an audit of compliance with the program requirements of “major federal programs.” In some cases, only an audit of the compliance program is required.
For 2021, federal funding that may be subject to a Single Audit includes Economic Injury Disaster Loans (EIDL), Provider Relief Funds (PRF), and possibly Restaurant Revitalization Funds (it is currently unclear if Congress made an exception to the Single Audit for this program). PPP loans and ERC funds are specifically EXCLUDED as part of those programs that will trigger an audit.
The interconnecting program rules are very complicated so it is imperative that you determine as soon as possible if an audit is required for your organization. If your entity received any of the above mentioned funds, total up those funds along with any other governmental grants that may have been received. If that total is greater than $750,000 then you will probably need an audit. For entities with a calendar year end of December 31, 2021, the audit is required to be completed and submitted to the appropriate agency by September 30, 2022. With Provider Relief Funds, the audit may not need to be filed until a year later, September 30, 2023.
For many businesses, this audit requirement may come as a surprise as it may be the only time that the business has received a large amount of federal funding and thus required to have a Single Audit completed.
Please contact Kristen Hoyle (Kristen.email@example.com) in our office if you have questions about whether your business or non-profit may be subject to the Single Audit requirements.