The 2024 OMB Compliance Supplement has been released and is effective for fiscal years starting after June 30, 2023. This annual issuance serves as the government’s guide for single audits and grant compliance. The document is available each year at the following website – https://www.whitehouse.gov/omb/office-federal-financial-management/current-compliance-supplement/.
The guide covers the most common grants from 22 Federal Departments and/or Agencies along with their related compliance audit requirements. This information is then used by granting agencies, organizations who received the fundings, and CPA firms to better understand and document those compliance requirements and, ultimately, audit the grant expenditures.
The largest and most significant change in this year’s compliance supplement is the increase in the threshold for single audits from $750,000 to $1,000,000 of overall federal expenditures in a single fiscal year. This threshold is applicable for fiscal years beginning on or after October 1, 2024, so most entities won’t see this change until their 2025 fiscal years (See pg. 1-1, PDF page 10 of 2,105).
Another noteworthy change is the reduction in the number of “Higher Risk” Programs to only 6 total grants, 3 stand-alone grants, and 1 cluster of 3 grants. These have been and are still related to COVID-19 funding and remain designated as High Risk due to contracts extending into the 2025 fiscal year.
Grants deemed higher risk will typically be selected for audit if they are over the $750,000 Type A Threshold, even if audited in a prior year and would normally meet the qualifications for low-risk status. The specific grants included in this category are:
- Medicare Cluster – 93.778/93.777/93.775
- Emergency Rental Assistances – 21.023
- Coronavirus State and Local Fiscal Recovery Funds – 21.027
- Abandoned Mine Land Reclamation (AMLR) – 15.252
There will be some updates to the compliance requirements for certain grants, so do not assume that your grant will have the same requirements as last year, please go download a copy and look for yourself.