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Audit Preparation

Single Audits, and the threshold that just moved

The Single Audit threshold rose from $750,000 to $1 million. Many guides and firm websites still show the old figure.

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Last reviewed

What changed

2024 revisions to 2 CFR Part 200 (Uniform Guidance)

The Single Audit threshold rose from $750,000 to $1,000,000 of federal awards *expended*, effective for fiscal years beginning on or after 1 October 2024, so first biting for fiscal year ends on or after 30 September 2025.

Other changes in the same revision: the Type A programme threshold also rose to $1 million for entities with $34 million or less in total federal expenditures; the subaward exclusion from Modified Total Direct Cost rose from $25,000 to $50,000; and the equipment capitalisation threshold rose from $5,000 to $10,000.

Expended, not received

The test is on federal awards expended during the fiscal year, not awarded or received. An organisation can hold a $3 million multi-year grant and expend $600,000 in a given year: that year, no Single Audit is required.

It also aggregates across all federal sources, including funds passed through a state or county agency. Pass-through money is federal money, and organisations routinely miss it because the cheque came from Sacramento.

What a Single Audit adds

It sits on top of the financial statement audit, not instead of it, and it is performed by your independent auditor. Wago Pop does not perform Single Audits; we help you prepare the SEFA and the compliance support the auditor will test.

  • A Schedule of Expenditures of Federal Awards (SEFA), which has to be complete and accurate: this is where most findings begin
  • Testing of compliance requirements for each major programme: allowable costs, eligibility, reporting, procurement, sub-recipient monitoring and more
  • Testing of internal control over compliance, separately from controls over financial reporting
  • An auditor's opinion on compliance for each major programme
  • A schedule of findings and questioned costs
  • Submission to the Federal Audit Clearinghouse, on a deadline
  • Where the auditee is a government or receives certain funds, Yellow Book (GAGAS) standards apply as well

Get the SEFA right first

In our experience the SEFA is a very common source of trouble. Programmes get omitted, pass-through funds are missed, Assistance Listing numbers are wrong, or expenditure is recorded on the wrong basis.

Building the SEFA properly during the year, rather than reconstructing it in the week before fieldwork, is one of the cheapest things an organisation with federal funding can do to keep its audit on schedule. It is work we do for clients alongside their monthly close.

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Nonprofit audits

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Common questions

Not answered here? Ask us directly: we would rather explain it than have you guess.

Does the new threshold apply to our current audit?

It applies to fiscal years beginning on or after 1 October 2024. For a June 30 year end, that means the fiscal year beginning 1 July 2025, the year ended 30 June 2026, is the first one under the new threshold. Check your fiscal year start date rather than your year end, because that is what governs.

We expend between $750,000 and $1 million. Are we now exempt?

From the federal Single Audit requirement, yes, for fiscal years beginning on or after 1 October 2024, but check your award terms before standing down. Individual grantors sometimes impose audit requirements contractually that are stricter than Uniform Guidance, and a state pass-through agency may have its own rules. The federal floor is not always the operative requirement.

Does state or county funding count?

Only if it originates federally. Money passed through a state or local agency from a federal source is federal money for Single Audit purposes and belongs on the SEFA. This is the most frequent omission we see. If an award letter mentions an Assistance Listing number, that is federal money regardless of who wrote the cheque.

What is the difference between a Single Audit and a Yellow Book audit?

Yellow Book, Generally Accepted Government Auditing Standards, is a set of auditing standards that adds requirements around independence, quality control and reporting on internal control. A Single Audit is performed *under* Yellow Book standards and adds programme-specific compliance testing on top. Some entities are required to have a Yellow Book audit without triggering a Single Audit. Either way, the audit is performed by an independent audit firm.

When is the report due?

The reporting package must be submitted to the Federal Audit Clearinghouse by the earlier of 30 days after receipt of the auditor's report or nine months after the fiscal year end. For a June 30 year end that is 31 March, which is the same date California's public availability requirement lands on. The two deadlines coincide, so there is no slack.

How do we start?

Book a scoping call using the form on this page, or call us. We will ask about your federal awards, your fiscal year, and what condition your records are in, then tell you what the preparation work involves and what it will cost before anything begins.

Book a scoping call

Twenty minutes, no charge. Tell us what you need and we will tell you what it involves, what it will take, and whether we are the right fit for it.

  • A short call with the person who would actually do the work.
  • A clear scope and a fixed quote before anything begins.
  • We reply to every enquiry within one business day.

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Free resource

Work out whether your nonprofit actually needs an audit

California's audit trigger is not the number on Form 990 line 12, and the federal Single Audit trigger is a different number again. The worksheet walks both, with the citation beside each step.

  • The California Nonprofit Integrity Act test, and what counts as gross revenue for it
  • The Single Audit test at $1,000,000 of federal awards expended
  • Where a grant agreement can require an audit no statute requires
  • What to do if you cross the line part way through a year

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We email you this one document and nothing else unless you ask. We do not share your details, we do not add you to a sequence, and one reply saying stop ends it.