In a memorandum dated June 18, 2020, the U.S. Office of Management and Budget (OMB) revised and reversed their flexibility on Single Audit submission extensions.
Under the new guidance included in OMB Memorandum M-20-26, extensions of Single Audit submissions are as follows:
- Six-month submission extension (beyond the normal due date) for Single Audits (not yet submitted at March 19, 2020) with June 30, 2019 through September 30, 2019 year-ends;
- Three-month submission extension (beyond the normal due date) for Single Audits (not yet submitted at March 19, 2020) with October 31, 2019 through December 31, 2019 year-ends; and
- No submission extension for Single Audits of year-ends after December 31, 2019 (i.e., January through June 2020 year-ends). These Single Audits will have to be submitted to the Federal Audit Clearinghouse within the normal due date provisions under the Uniform Guidance.
Recipients and sub-recipients who are able to take advantage of the above extensions can still qualify as a low-risk auditee. No further action by awarding agencies is required to enact the extensions and individual recipients and sub-recipients are not required to seek approval for the extension. Recipients and sub-recipients should maintain documentation of the reason for the delayed filings.
Per a communication from the State of Illinois’ Governor’s Office of Management and Budget, Illinois organizations subject to audits required by the Grant Accountability and Transparency Act (GATA) can assume that the flexibility guidance awarded at the federal level will be similarly adopted at the state level.
OMB’s Memorandum M-20-26 also clarified the following information:
Double-Dipping Not Permitted
The memo clarifies that payroll costs paid with Paycheck Protection Program (PPP) loans or any other federal CARES Act programs must not also be charged to current federal awards as it would result in the federal government paying for the same expenditures twice.
Exhausting Other Funding Sources
The memo states that awarding agencies must inform recipients to exhaust other available funding sources to sustain its workforce and implement necessary steps to save overall operational costs (such as rent renegotiations) during the pandemic period in order to preserve federal funds for the ramp-up effort. It also instructs federal agencies that recipients should retain documentation of their efforts to exhaust other funding sources and reduce overall operational costs.
Separate Schedule of Expenditures of Federal Awards (SEFA) Identification
The memo states that in order to provide adequate oversight of the COVID-19 Emergency Acts funding and programs, recipients and subrecipients must separately identify the “COVID-19 Emergency Acts expenditures” on the SEFA and in audit report findings.