Single Audit – Recent Developments from the Office of Management and Budget

The Office of Management and Budget (OMB) recently issued a memorandum repealing previously issued guidance on the extension of time to file with the Federal Audit Clearinghouse. In March 2020, OMB issued M-20-17, which provided a six-month extension on reporting packages to all entities that had not yet filed their singles audits with the Federal Audit Clearinghouse, as well as entities with fiscal year ends through June 30, 2020. Under M-20-26, there is no longer a blanket six-month extension.

Entities with audit due dates from March 30 through June 30, 2020 (year ends June 30, 2019 through September 30, 2019) have an extension of up to six months beyond the due date. Organizations with due dates from July 31 through September 30, 2020 (years ending October 31, 2019 through December 31, 2019) have an extension of up to three months beyond the due date. In addition, audits with year ends in 2020 are now due to the Federal Audit Clearinghouse based on the due date specified in the Uniform Guidance (the earlier of 30 days from report issuance or nine months from year end).

Additional Guidance on PPP Loans and Federal Grants

M-20-26 also specifically addresses the Paycheck Protection Program (PPP) loans and federal grant reimbursement. Per the memorandum, “Payroll costs paid with the Paycheck Protection Program (PPP) loans or any other Federal CARES Act programs must not be also charged to current Federal awards as it would result in the Federal government paying for the same expenditures twice.” Therefore, if you received PPP loans, the salaries and wages covered under the PPP are not eligible costs under Federal awards.

Preserving Federal Funds: What Recipients Should Keep in Mind

The memorandum provides for continuation of salaries and benefits charges and other costs but also notes that Federal award recipients should “…exhaust other available funding sources to sustain its workforce and implement necessary steps to save overall operational costs (such as rent renegotiations) during this pandemic period in order to preserve Federal funds…” Further, recipients are to retain documentation of their efforts.

SEFA Identification of COVID-19 Emergency Act Expenditures

Finally, M-20-26 states that COVID-19 Emergency Act expenditures are to be separately identified on the Schedule of Expenditures of Federal Awards (SEFA) and in audit findings.

The 2020 Compliance Supplement

It is important to note that entities receiving COVID-19-related funding may see a delay in the completion of their Single Audit this year. The 2020 Compliance Supplement is expected to be issued in two parts this year. The first part is expected in July and will contain limited information on the new programs resulting from the COVID-19 funding. The second part will be an addendum likely issued in the late summer or early fall. Until the addendum is issued, auditors do not expect to have the information necessary to complete testing over the new COVID-19 programs. While this impacts issuance of the Single Audit, the financial statement audit can be issued separately to adhere to traditional reporting timeframes or meet other financial reporting deadlines.

Our professional services advisors are available to assist with further details on the reporting options or if you have any additional questions. Please contact us with these inquiries.

Memorandum M-20-26 can be found at


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