U.S. Treasury Issues Guidance for Federal Requirements for Single Audits
U.S. Treasury released the 2022 Compliance Supplement – 2 CFR Part 200 Appendix XI. Among the changes that the Office of Management and Budget (OMB) issued is the Coronavirus State and Local Fiscal Recovery Funds (SLFRF): Assistance Listing # 21.027
The Compliance Supplement provides a road map that auditors must follow when performing a Single Audit. With the large number of new federal COVID-19 programs awarded to states and municipalities, it can also be a useful tool to better understand the audit process and what the auditors will be testing.
Unless otherwise specified, municipalities that expend $750,000 or more in Federal financial assistance within their fiscal year are required to engage the services of an auditor to conduct Single Audits.
The 2022 Compliance Supplement includes an alternative option to the Single Audit for municipalities that would otherwise not be required to undergo an audit if it was not for the expenditures of SLFRF funds directly awarded by Treasury.
SLFRF recipients that expend $750,000 or more during their fiscal year in Federal awards and meet both criteria listed below have the option for their auditor or practitioner to follow the Alternative Compliance Examination Engagement guidance. The criteria are:
1. The recipient’s total SLFRF award received directly from Treasury is at or below $10 million; and
2. Other Federal award funds the recipient expended (not including their SLFRF award funds) are less than $750,000 during the recipient’s fiscal year.
We encourage you to share this information with your Chief Financial Officer and your Municipal Manager. Questions can be addressed to U.S. Treasury at SLFRF@treasury.gov.
Contact: Paul Penna, Senior Legislative Analyst, ppenna@njlm.org, 609-695-3481, x110.