TITLE 44: GOVERNMENTAL CONTRACTS, GRANTMAKING, PROCUREMENT AND PROPERTY MANAGEMENT
SUBTITLE F: GRANTMAKING
CHAPTER I: GOVERNOR'S OFFICE OF MANAGEMENT AND BUDGET
PART 7000 GRANT ACCOUNTABILITY AND TRANSPARENCY ACT
SECTION 7000.90 AUDITING STANDARDS


 

Section 7000.90  Auditing Standards

 

Following UR section 200.501 (Audit Requirements):

 

a)         Awardees, excluding for-profits, that expend $750,000 or more during the non-federal entity's fiscal year in federal awards (federal pass-through and direct federal funds) must have a single audit conducted in accordance with UR section 200.514.  Awardees meeting certain requirements may elect to have a program-specific audit conducted in accordance with UR section 200.507.  (See Section 7000.90(d) for audit requirements for for-profit subrecipients.)

 

b)         Awardees that expend less than $750,000 during the non-federal entity's fiscal year in federal awards (federal pass-through and/or direct federal funds) from all sources are exempt from federal audit requirements for that year.  These non-federal entities are not subject to the single audit requirements.

 

c)         Awardees that expend less than $750,000 in direct federal and federal pass-through funds from all sources are subject to the following audit requirements:

 

1)         Awardees that expend $500,000 or more in State, direct federal and federal pass-through funds, singularly or in any combination, and are not subject to the single audit:

 

A)        Must have a financial statement audit conducted in accordance with GAGAS; and

 

B)        If deemed to be high risk based on the grantee's overall risk profile (obtained from the Financial and Administrative Risk Assessment, the Merit-Based Review, or the Programmatic Risk Assessment mandated by UR section 200.331 (see Section 7000.340)):

 

i)          Must have an audit conducted in accordance with GAGAS; and

 

ii)         Are required to undergo either an on-site review conducted by the State Cognizant Agency or an agreed upon procedures engagement, paid for and arranged by the pass-through entity or pass-through entities in accordance with UR section 200.425.

 

2)         Awardees that do not meet the requirements in subsection (c)(1) but expend $300,000 or more in State, direct or federal and federal pass-through funds, singularly or in any combination, during the awardee's fiscal year must have a financial statement audit conducted in accordance with GAAS or GAGAS.

 

d)         For-profit Subrecipient. The pass-through entities are responsible for ensuring subrecipient compliance with established requirements. Methods to ensure compliance for State and federal awards to for-profit subrecipients may include pre-award audits, monitoring during the agreement period of performance, and post-award audits. See also UR section 200.331 (Requirements for Pass-through Entities).

 

1)         For-profit Subrecipient Audit Requirements. For-profit subrecipients who expend $750,000 or more in direct federal and federal pass-through funds during their fiscal year are required to have a program-specific audit conducted in accordance with UR section 200.507 (Program-specific Audits).

 

A)        State grantmaking agencies must provide the recipient/subrecipient the program-specific audit guide, when available.

 

B)        If a program-specific guide is not available, the auditor and auditee have the same responsibilities for the program as they would have for a major program in a single audit.

 

2)         For-profit subrecipients who expend less than $750,000 in direct federal and federal pass-through funds during their fiscal year are required to follow the audit requirements in subsection (c).

 

e)         Awardees do not meet the requirements in subsection (c) or (d) but have audits conducted based on other regulatory requirements must submit those audits for review.

 

f)         Single Audit and Program Specific Audit Report Submission.  Single audits conducted in accordance with this Section, including any program or regulatory audit requirements, must be completed and the reporting package described in subsection (g) must be submitted by the non-federal entity (grantee/subrecipient) to the Federal Audit Clearing House, as required by UR section 200.512 and the GATA Information Warehouse, within the earlier of 30 calendar days after receipt of the auditor's reports or 9 months after the end of the non-federal entity's audit period.  If the due date falls on a Saturday, Sunday or State/federal holiday, the reporting package is due the next business day.

 

g)         Financial Statement Audits conducted in accordance with this Section must be completed and the reporting package described in subsection (g) must be submitted by the non-federal entity to the GATA Information Warehouse within the earlier of 30 calendar days after receipt of the auditor's reports or 6 months after the end of the non-federal entity's audit period.  If the due date falls on a Saturday, Sunday or State/federal holiday, the reporting package is due the next business day.

 

h)         Reporting package submissions must include:

 

1)         For Single Audit and Program Specific Audit submissions:

 

A)        All items identified in UR section 200.512(c);

 

B)        Management letters and AU 325 communication issued by the auditors, and their respective corrective action plans; and

 

C)        Consolidated Year-end Financial Report with an "in relation to opinion".

 

D)        A copy of the results of the most recent peer review of the audit firm.

 

2)         For Financial Statement Audit submissions: 

 

A)        Financial Statements;

 

B)        Summary schedule of Prior Audit Findings;

 

C)        Auditor's report;

 

D)        Corrective Action Plan;

 

E)        Management letters and AU 325 communications issued by the auditors, and their respective corrective action plans; and

 

F)         Consolidated Year-end Financial Report with an "in relation to opinion".

 

G)        A copy of the results of the most recent peer review of the audit firm.

 

3)         Non-federal entities that are not required to have an audit conducted must submit a Consolidated Year-end Financial Report.