Single Audit Considerations for Not-for-Profits That Receive Federal Awards

This article was updated April 13, 2022

Annual federal awards to state and local governments, Tribes, and not-for-profit organizations grew from a few billion dollars in the 1960s to hundreds of billions of dollars today. These funds bring certain restrictions and requirements that the recipient organization must follow.

To ensure compliance with these requirements, the federal government relies on financial and compliance audits of the federal awards, known as Single Audits.

Learn more about these audits and specifics within the Schedule of Expenditures of Federal Awards below.

When Is a Single Audit Performed?

The Uniform Guidance—Title 2 CFR Part 200—streamlines and consolidates government requirements for receiving and using federal awards to reduce administrative burden and improve outcomes.

Uniform Guidance requires an independent auditor to conduct a Single Audit if the nonfederal entity expends $750,000 or more in federal awards during the fiscal year.

The Single Audit includes an audit of the nonfederal entity’s financial statements. As part of the Single Audit, auditees must prepare a supplementary schedule to their financial statements, known as a Schedule of Expenditures of Federal Awards (SEFA).

Once the Single Audit ends and the auditor releases the auditor’s reports, the nonfederal entity must submit the data collection form—Form SF-SAC—to the Federal Audit Clearinghouse within the earlier of:

  • 30 calendar days after the receipt of the auditor’s reports
  • Nine months after the end of the audit period

COVID-19 Extensions

Due to the COVID-19 pandemic, the federal government offers an automatic six-month extension for auditees that had yet to file their Single Audits with the Federal Audit Clearinghouse as of March 19, 2021 through June 30, 2021 when the fiscal year ends.

No approval for the extension by the cognizant or oversight agency is necessary, however, federal award recipients should document why they exercised an extension.

The extension has no impact on the recipient’s qualification as a low-risk auditee under the criteria of Title 2 CFR section 500.520(a). A nonfederal entity with a fiscal year end of June 30, 2021—with a normal due date of March 30, 2022—can file until September 30, 2022.


The Uniform Guidance—Title 2 CFR Part 200—streamlines and consolidates government requirements for receiving and using federal awards to reduce administrative burden and improve outcomes.

What Is the Schedule of Expenditures of Federal Awards?

The SEFA summarizes federal grant expenditures as a basis for reporting all federal funds for the Single Audit.

The Uniform Guidance states that the auditee must prepare this schedule for the period the financial statements cover.

What Should Be Reported on the SEFA?

As required by Title 2 CFR section 200.510(b), the SEFA must:

  • Include total federal awards expended
  • List individual federal programs by federal agency
  • Provide total federal awards expended for each individual federal program

Each program must provide the Federal Assistance Listing number, formerly known as CFDA, or other identifying number if the Federal Assistance Listing number is unavailable.

For a cluster of programs, such as student financial assistance, the SEFA must:

  • Provide the cluster name
  • List individual federal programs within the cluster
  • Provide the applicable federal agency name
  • Provide total federal awards expended for the cluster

Pass-through entities must include the total amount provided to subrecipients from each federal program. Subrecipients must identify any awards they receive from a pass-through entity, including the name of the pass-through entity and identifying number the pass-through entity assigns.

The SEFA should contain notes describing the significant accounting policies the auditee uses to prepare the schedule. The notes should also indicate whether the auditee elected to use the 10% de minimis indirect cost rate, as the Uniform Guidance allows, as well as any balances outstanding on loan or loan guarantee programs at the end of the period.

COVID-19 Specific Reporting Requirements

If the award relates to a COVID-19 federal award, the awardee must report those expenditures on a separate line on the SEFA with “COVID-19” as a prefix.

If an award relates both to COVID-19 and non-COVID-19, the SEFA should show each as a separate line item with its own expenditures, and then a total of expenditures for that Federal Assistance Listing number.

The Federal Assistance Listing number should include the alpha character associated with that award if one exists, such as 84.425E.

Reporting Updates for the SEFA

Money received under the Paycheck Protection Program (PPP) shouldn’t be included on the SEFA.

Awardees receiving money from the shuttered venue operators grant (SVOG) should include SVOG expenditures on the schedule of expenditures of federal awards. Expenditures claimed under SVOG should be recognized on the SEFA in the year when the expenditures occurred.

Expenditures that occurred in a period prior to the actual receipt of the SVOG funds should also be included in the SEFA during the year when the funds were received and recognized. Costs incurred in a prior period would still need to have occurred within the time period specific for their SVOG award.

If an entity received donated personal protective equipment (PPE) originally purchased with federal assistance funds, there should be a separate footnote to the SEFA indicating the fair market value of the PPE at the time of receipt.

What Are Federal Awards Expended?

Federal awards expended include the following in accordance with the definition outlined in Title 2 CFR section 200.1 and 200.502:

  • Direct costs of expenditure transactions associated with grants, cost-reimbursement contracts, cooperative agreement, and direct appropriations
  • Indirect costs claimed for reimbursement using an indirect cost rate or cost allocation plan
  • Disbursement of grant funds that the entity passed through to subrecipients
  • Use of loan proceeds under loan and loan guarantee programs–loan programs reported should be the loans outstanding at the beginning of the period plus loans disbursed during the period
  • Receipt of federal property including some surplus property
  • Receipt or use of program income
  • Receipt of noncash assistance such as food commodities and vaccines
  • Disbursement of amounts entitling a nonfederal entity to an interest subsidy
  • Insurance contracts in force during the period under audit

Should the SEFA Include Program Income?

For most programs, the use or expenditure of program income is reported on the SEFA in the period the expenditure occurs in accordance with the basis of accounting used by the recipient. However, some federal agencies differ on the treatment of program income on the SEFA.

Therefore, the recipient of the federal award should confirm with the grantor on how it requires the program income to be reported. If you report program income on the SEFA, be sure to include a footnote disclosure regarding that income.

Are Vendor or Contract Services Reportable?

Organizations must determine and communicate whether federal money passed through to another organization represents a subrecipient or a contractor, formerly referred to as a vendor, relationship to conclude if the expenditures appear on the SEFA as passed through to a subrecipient.

The recipient organization reports the federal expenditures on the SEFA. If the recipient passes money to another organization the recipient determines if that other organization is a subrecipient or not.

If it’s determined there’s a subrecipient, the recipient organization indicates on the SEFA the money was passed through to a subrecipient. In addition, the subrecipient also shows its expenditures on its SEFA noting it was passed through from another organization.

Refer to Title 2 CFR Part 200 for assistance in making this determination. See additional guidance on determining if an organization is a subrecipient or a contractor.

How Can Your Organization Prepare for a Single Audit?

The best way to prepare for an upcoming single audit is to consult with your auditor before the audit begins. This ensures your entity has a good understanding of the audit process and requirements of a Single Audit.

Learn more about COVID-19’s impact on Single Audits in our webcast.

We’re Here to Help

If you have any questions about Single Audits or SEFA reporting, please contact your Moss Adams professional.

You can also learn more about our Not-for-Profit Practice and additional topics affecting the industry.

Additional Resources

For regulatory updates, strategies to help cope with subsequent risk, and possible steps to bolster your workforce and organization, please see the following resources:

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