Takeaways from AICPA's Webinar on Single Audit Updates

The two-hour webcast was filled with great information.

We continue to receive new guidance from the Office of Management and Budget (OMB). Yesterday, I listened to AICPA’s Government Audit Quality Center’s webcast titled “Pandemic Related Single Audit Issues and Other Single Audit Updates.” The two-hour webcast was filled with great information. Below are my takeaways.

The OMB Compliance Supplement (version 2) was released in August, but the addendum was issued on December 3, 2021. So far, only two programs include addendums: Treasury SLFRF (ALN 21.027) and Education Stabilization Fund (ALN 84.425), also known in our K-12 world as ESSER. Please make sure that you read the requirements issued for auditors. It’s truly a cheat sheet for your 2021 and 2022 audits. For Districts and Schools with June 30th year ends, not to worry. Auditors had to use what was available in the OMB Compliance Supplement as of August 2021.

For those of you that know me, I love all things compliance. The Compliance Supplement stipulates which requirements are subject to audit by external auditors. As such, there may be instances where, for example, procurement is not subject to audit. This doesn’t mean that you do not have to comply with 2 CFR 200.318 through 2 CFR 200.327. It very much applies and while your auditor may give you a pass in one year, a regulatory agency will not. As the auditee, assume that all compliance requirements are applicable, unless there is an explicit exemption in your grant agreement or in a federal agency FAQ document.

The OMB has also designated the American Rescue Plan Act (ARPA) as higher risk. This means that auditors will be testing your ESSER III program as a major program through 2023 or 2024, depending on the level of expenditures. There are also other non-ARPA programs that are considered higher risk and auditors will be hard pressed to assess them as not-high risk if they are considered Type A Programs (i.e. larger programs). Below is a list of non-ARPA programs with a higher risk designation that are common in districts and charter schools schedule of expenditures of federal awards:


Assistance Listing Number




Medicaid Cluster



Provider Relief Fund



Coronavirus Relief Fund



Education Stabilization Fund (ESSER I and II)

Many schools are starting to receive the Pandemic EBT – Food Benefits (ALN 10.542) and Pandemic EBT – Admin Costs (ALN 10.649). These programs will be included in Addendum #2. Please make sure that you identify these programs as federal revenue and are recorded in the correct object code. Other programs that are often received by K-12 entities are TANF (ALN 93.558) and Child Care and Development Block Grant/Cluster (ALN 93.575). These programs will also be included in Addendum #2.

Lastly, make sure that your internal controls over your federal programs are in place and that there is always an audit trail of your review and approval. Document all of your spending decisions and rational behind those decisions. I know that many of you brainstorm and assess risk on a daily basis but document those discussions and file it away. This way there is no question from your external auditor or a regulatory agency auditor. Most importantly, if you are making decisions based on an regulatory agency FAQ, keep that as part of the supporting documentation.

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