Is this your first single audit? Did the American Rescue Plan funding push you over the threshold to require a single audit? You might be in luck!
The Governmental Audit Quality Center (GAQC) recently sent out guidance regarding smaller entities receiving federal funds for the first time. Federal agencies realize the burden that the additional funding puts on smaller entities to comply with the rigorous requirements of the Uniform Guidance. Roughly 10, 000 new entities have met the threshold for a single audit due to ARPA funding.
There has been a Federal Register (FR) notice sent out describing the following –
The SLFRF updated supplement Addenda 2 has alternative procedures to consider. Entities meeting the $750,000 threshold and meet both of the following criteria have the option to follow alternative SLFRF compliance examination engagement:
An entity may still choose to have a single audit completed. If the entity chooses to complete the alternative – a compliance examination engagement – the entity (and the auditors) must follow compliance in accordance with the Government Accountability Office (GAO). This would follow attestation standards and reduce the requirements performed overall. Testing would focus mostly on the allowability of expenditures and ensure the entity has appropriate controls over specific functions in the finance department.
The alternative procedures would significantly reduce the test work and requirements on both sides, the entity and the auditors. If you think you might qualify for this option, it might be worth asking your auditor.
For more information on this topic, or to learn how Baker Tilly specialists can help, contact our team.