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Key Takeaways About the 2021 Compliance Supplement

The U.S. Office of Management and Budget (OMB) released the 2021 Compliance Supplement on August 12, 2021. It is effective for audits of fiscal years beginning after June 30, 2020, and supersedes the 2020 Compliance Supplement and its addendum.

The 2021 Compliance Supplement contains more than 1,700 pages. Here are some key takeaways to be aware of:

  • Higher-risk programs identified include:
    • Education Stabilization Fund
    • Coronavirus Relief Fund
    • Provider Relief Fund
  • This designation will likely affect your auditor’s major program determination
  • The Supplement clarifies key requirements for the Provider Relief program, including when to include expenditures on the schedule of expenditures of federal awards and what aspect auditors are required to test
  • OMB is expected to issue more guidance in two future addenda:
    • The first addendum, which is anticipated in the fall, is expected to include guidance on the Coronavirus State and Local Fiscal Recovery Funds (AICPA GAQC) and Education Stabilization Funds for new ARP programs 84.425U and 84.425X
    • The second addendum is expected to include guidance on the Capital Projects Fund, Homeowners Assistance Fund, and the Local Assistance and Tribal Consistency Fund

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