Provider Relief Funds: Conducting Your First Single Audit?

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business people working together in the officeFor-profit businesses that received Provider Relief Funds (PRF) may be required to have a specialized audit performed on the use of those funds – for most, this will be the first time they are subject to these requirements.

Guidance from the Health Resources & Service Administration (HRSA) states that, “Commercial organizations that expend $750,000 or more in annual awards have two options…1) a financial related audit of the award or awards conducted in accordance with Generally Accepted Government Auditing Standards; or 2) an audit in conformance with the requirements of…(a) Single Audit.” Provider Relief Fund General and Targeted Distribution payments as well as Uninsured Testing, Treatment and Vaccine Administration reimbursement payments must also be included in the determination of whether a Yellow Book or Single Audit is required, according to the guidance.

While these audits are typically required for grant-funded not-for-profit organizations, any business that spent PRF in excess of $750,000 are now subject to this audit requirement. Recipients of the grant typically have nine months after obtaining the funds to fulfill the audit requirements, therefore, this is not something you want to postpone.

How do you know if you need to complete the Program-specific or Single Audit?

Any commercial organizations that spent $750,000 or more in annual federal awards must perform one of the two audit options. If you fall into this category, you must register through the PRF Reporting Portal and should start talking to your CPA on taking the next steps to perform the audit. It is your company’s responsibility to select audit firms and coordinate the audit, not the HRSA. Recipients will be notified via email when you can submit the information about your use of funds. Audit reports must be emailed to the HRSA’s Division of Financial Integrity at PRFaudits@hrsa.gov.

Where do you start?

A Single Audit is essentially an audit of the appropriate use of the Provider Relief Funds. We understand that many of you have not ever had to complete this audit requirement. It’s normal to be confused or unsure of the next steps. To prepare for the expectations of this audit, it’s important to gather documentation of all PRF expenditures. Your auditor will analyze the documentation to ensure you’ve used the funding appropriately and to make sure the audit is completed.

Next, find an audit service provider you can trust to support you in performing the audit requirements for the first time. With a professional’s help, you can meet these new requirements with ease and efficiency. Start with your existing CPA relationship to see if they have the appropriate expertise (your auditors must perform this audit in accordance with the Generally Accepted Government Auditing Standards, which is a specialized focus that not all audit firms may be able to perform).

While you have nine months to complete the audit, those who also received COVID-19 funding are granted an additional three months. You and your auditor do not need to request this extension, but delayed filing should be documented when your auditor submits your audit report.

Get started

The audit requirements are not optional for commercial organizations that spent $750,000 or more in annual federal awards. The HRSA states that, “Recipients who do not report within the respective reporting time period will be considered out of compliance with payment Terms and Conditions, and funds may be subject to recoupment.” Make sure you’re meeting this crucial requirement before time is up. Sikich’s team of professionals performs countless Single Audits each year and has firsthand in-depth experience with commercial and for-profit businesses. To talk to our team, please contact us below.

About our authors

Allan Lyon

Allan Lyon

Allan Lyon, CMA, CPA, MSA, is a director providing audit, accounting services, consulting and, among others, due diligence engagements related to merger and acquisition transactions. Allan is directly involved in resolving assurance and business operational concerns and works closely with upper management. He works as a consultant with clients in the areas of assurance, operations, inventory management, internal controls, strategic planning and financing.

Justin Dooley

Justin Dooley

Justin Dooley, CPA, is an audit manager responsible for performing key audit procedures and internal control evaluations, report preparation and supervision of audit fieldwork teams. Justin has experience auditing a variety of governmental entities and not-for-profit organizations.

This publication contains general information only and Sikich is not, by means of this publication, rendering accounting, business, financial, investment, legal, tax, or any other professional advice or services. This publication is not a substitute for such professional advice or services, nor should you use it as a basis for any decision, action or omission that may affect you or your business. Before making any decision, taking any action or omitting an action that may affect you or your business, you should consult a qualified professional advisor. You acknowledge that Sikich shall not be responsible for any loss sustained by you or any person who relies on this publication.

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