When a Single Audit is required, and what it involves

The threshold and when it took effect

A non-federal entity that "expends $1,000,000 or more" in federal awards during its fiscal year must have a single or program-specific audit for that year (2 CFR 200.501(a)). The rule is in Subpart F of the Uniform Guidance (2 CFR Part 200). It covers nonprofits, including houses of worship and private schools, as well as States, local governments and Indian Tribes. It doesn't apply to for-profit organizations; a pass-through entity sets other compliance steps for a for-profit subrecipient (200.501(i)).

OMB's 2024 revision raised the threshold from $750,000 to $1,000,000 "for auditee fiscal years beginning on or after October 1, 2024" (OMB, 2025 Compliance Supplement, Part 1). The start of the organization's fiscal year decides which number applies:

Below the threshold, the organization is exempt from federal audit requirements for that year, but its records must stay available for review or audit by the federal agency, the pass-through entity and the Government Accountability Office (200.501(e)). The exemption covers federal audit requirements only. It doesn't address an audit that another law or agreement may require.

Start with the award or subaward terms and the awarding agency's or pass-through entity's current instructions. Those documents may impose program-specific or stricter requirements in addition to the Uniform Guidance. If the instructions appear to conflict, ask the awarding agency or pass-through entity for written clarification before acting.

Counting federal awards expended

The count includes every federal award the organization spends as a recipient or as a subrecipient, from every agency and every pass-through entity (2 CFR 200.501(g)). Money the organization earns as a contractor selling goods or services under someone else's federal award doesn't count. A state grant counts only to the extent it passes through federal funds, so ask the state agency for the Assistance Listing number of any subaward.

Timing follows the activity, not the award date or the award amount. Under 2 CFR 200.502(a), an award is expended when the activity that triggers compliance occurs, such as an expense transaction, a payment to a subrecipient, the receipt of property, or the receipt or use of program income. Non-cash assistance received as part of a federal award, such as donated property, counts at fair market value (200.502(g)). A multi-year award can therefore fall in several fiscal years, and two modest awards spent in the same year can cross the line together. A Nonprofit Security Grant Program award is one example: FY2026 limits held one organization to $600,000 per state, but NSGP spending plus other federal spending in the same year can exceed $1,000,000; NSGP monitoring covers how the state follows up.

Whether a payment is a subaward or a contract is decided by the pass-through entity, case by case, and "the substance of the relationship is more important than the form of the agreement" (2 CFR 200.331). No single factor decides it.

Single audit or program-specific audit

Most organizations over the threshold get a single audit, which covers the financial statements and the federal programs together. A program-specific audit is allowed only when the organization spends federal awards under one federal program (other than research and development) and no statute, regulation or award term requires a financial statement audit (2 CFR 200.501(c)). Audits are annual. A nonprofit may use biennial audits only if it had them for all biennial periods ending between July 1, 1992, and January 1, 1995 (2 CFR 200.504).

What the organization does, and what the auditor tests

The organization, called the auditee, must arrange the audit, prepare its financial statements and a schedule of expenditures of federal awards, give the auditor access to people and records, and follow up on findings (2 CFR 200.508). It procures the auditor under the federal procurement standards in 200.317 through 200.327, and it must ask each proposing firm for a copy of its peer review report (2 CFR 200.509(a)).

The schedule of expenditures of federal awards lists each program by federal agency and Assistance Listing number. For subawards it must name the pass-through entity and the identifying number that entity assigned, and its notes must say whether the organization elected the de minimis indirect cost rate of up to 15 percent (2 CFR 200.510(b)).

OMB's Compliance Supplement tells auditors which compliance requirements to consider for each program. The auditor must report, among other things, significant deficiencies and material weaknesses in internal control over major programs, material noncompliance, known questioned costs above $25,000 for a type of compliance requirement in a major program, and known or likely fraud (2 CFR 200.516(a)). An organization qualifies as a low-risk auditee, with reduced audit coverage, when each of its two preceding audit periods had an annual audit filed on time, unmodified opinions, no material weaknesses, no going-concern doubt and none of the listed major-program findings (2 CFR 200.520). That status is also one of the grounds for self-certifying a higher micro-purchase threshold, up to $50,000, under 2 CFR 200.320(a)(1)(iv).

Filing with the Federal Audit Clearinghouse

The audit, the data collection form (Form SF-SAC) and the reporting package are due "within 30 calendar days after the auditee receives the auditor's report(s) or nine months after the end of the audit period (whichever is earlier)" (2 CFR 200.512(a)(1)). A due date on a weekend or federal holiday moves to the next business day. The cognizant or oversight agency for audit may extend the nine-month limit when it would place an undue burden on the auditee.

The reporting package contains the financial statements and schedule of expenditures of federal awards, the summary schedule of prior audit findings, the auditor's reports, and the corrective action plan (200.512(c)). A senior-level representative, such as the chief executive officer or chief financial officer, signs a certification in the data collection form, including that the package contains no protected personally identifiable information and that the Clearinghouse may publish it (200.512(b)(2)). The Federal Audit Clearinghouse, run by the General Services Administration, is the "repository of record" and makes the packages public (200.512(b), (g)); its submission resources include the SF-SAC workbooks and instructions. Keep a copy of the form and the package for three years from the date of submission (200.512(f)).

After the audit: findings and late filings

The auditee must prepare a corrective action plan for each current finding, naming the contact person, the action and the expected completion date, and a summary schedule showing the status of prior findings (2 CFR 200.511). The awarding agency issues a management decision on findings that affect its awards, and a pass-through entity does so for findings that affect its subawards, within six months of the Clearinghouse's acceptance of the report. Corrective action "should begin no later than upon receipt of the audit report" (2 CFR 200.521(b)–(d)).

Pass-through entities check. The regulation requires each one to verify that its subrecipients are audited as Subpart F requires and to consider past audit results when it assesses a subrecipient's risk (2 CFR 200.332(c), (g)). A late or missing audit can therefore lead to closer monitoring or specific conditions on a subaward.

Late filing also shows up in federal audits. In DOJ OIG Audit Report 25-097 (2025), the grantee's most recent single audit filing, made in April 2024, covered the year ended December 31, 2020, and its 2021 through 2023 audits were still unfinished in May 2025. The OIG found it had not complied with Part 200 or the Single Audit Act. Combined with a ledger that didn't separate the award from other activity, that led the OIG to question the entire $748,998 drawn as unsupported.

Plan the audit into the year. Code federal spending by award and Assistance Listing number as it happens, keep the subaward numbers each pass-through entity assigned, and track year-to-date federal spending against the threshold. Federal grant closeout and record retention explains how audit rights continue after an award closes, and the compliance checklist places the audit test in the award calendar.