Section 5.2: Audit requirements

An audit allows a S+C grantee to obtain an independent opinion regarding the sufficiency of the organization's financial management system.

All non-profit organizations, as well as state and local government agencies that receive $300,000 or more of Federal funding in a single year, are subject to the revised OMB Circular A-133, Audits of States, Local Governments, and Nonprofit Organizations. (See 24 CFR 84.26 (a))

A S+C grantee or sponsor that spends $300,000 or more in Federal awards in one year must have either a program audit or a single audit for that year.

  • A program audit is an audit of one Federal program. A program-specific audit is allowed when the grantee expends Federal awards under only one Federal program and the Federal program's laws, regulations or grant agreements do not require an overall financial statement of the audited organization.
  • A single audit is an audit for the entire organization. It includes audits of both the entity's overall financial statements and its Federal awards (from all applicable Federal programs).

Agencies that receive less than $300,000 a year in Federal awards are exempt from the OMB A-133 audit requirement. However, they must still make records available for review or audit by appropriate Federal agency officials, the grantee, and the General Accounting Office.

The financial management systems used by S+C governmental and PHA grantees must conform to the audit requirements outlined in 24 CFR Part 85. Private nonprofit organizations that are sub-grantees or sponsors must have financial systems that also conform to 24 CFR part 84 requirements.