I participated in a recent AICPA conference call which discussed the impact of more than $300 billion of American Recovery and Reinvestment Act of 2009 (Recovery Act) funds being disbursed to not-for-profits, states and local governments. The government has mandated an exceptional amount of accountability and transparency for these funds. Some items that you should prepare for if you have or will receive Recovery Act funds are:
- Single Audit – if your entity expends more than $500,000 of federal funds, you will be required to have an audit in accordance with OMB A-133. Many organizations that have not been subject to this audit requirement before will now be subject to it. Also in recurring A-133 audits, there will be an increased number of major programs to be audited due to the nature of the Recovery Act funds.
- Reporting – there will be quarterly reporting requirements for Recovery Act fund recipients. Also, Recovery Act funds will have to be separately identified on the Schedule of Expenditures of Federal Awards and the Data Collection Form. Additionally, the Federal Audit Clearinghouse will be required to make publicly available on the internet all single audit reports filed with them for fiscal years ending September 30, 2009, and later.
- Capacity/Internal Controls – it will be imperative for organizations to have adequate staff and internal controls in place to be able to ensure that the Recovery Act funds are being spent appropriately, the more stringent reporting requirements are being met, and their system can track activity properly.
We recommend your organization consider all the requirements for your Recovery Act funds and implement any necessary changes as early as possible to ensure a smooth transition into compliance. Please contact us if you have questions or need assistance.
For more information please contact, Jaclyn Badeau
