Uniform Guidance Audits
Certain Government Civilian Agencies require For-Profit grant recipients and subrecipients to have annual Uniform Guidance Compliance audit to be conducted by an independent CPA Firm. The two largest agencies requiring this are the National Institutes of Health (NIH) and the Department of Energy (DOE). The audit requirements for each Agency are summarized.
NIH Grantee Audit Requirements
The Department of Health and Human Services (HHS) has specified requirements for non-Federal audits of for-profit (commercial) organizations in HHS’ Title 45, Code of Federal Regulations (CFR), Part 75.501(h) through (k), “Non-Federal Audits.” Per the regulations, a for-profit (commercial) organization is subject to audit requirements for a non-Federal audit if, during its fiscal year, it expended $750,000 or more under HHS awards and at least one award is a HHS grant or subgrant. Title 45 CFR Part 75 essentially incorporates the thresholds and deadlines of Office of Management and Budget (OMB) Uniform Guidance: Cost Principles, Audit, and Administrative Requirements for Federal Awards and provides for-profit organizations with two options regarding the type of audit that will satisfy the audit requirements either:
- A financial related audit (as defined in the Government Auditing Standards, GPO Stock #020-000-00-265-4) of a particular award in accordance with Government Auditing Standards, in those cases where the recipient receives awards under only one HHS program; or, if awards are received under multiple HHS programs, a financial related audit of all HHS awards in accordance with Government Auditing Standards; or
- An audit that meets the requirements contained in Title 45 CFR Subpart F.
DOE – 2 CFR 910.501- Audit Requirements
A. Audit required.
A for-profit entity that expends $750,000 or more during the non-Federal entity’s fiscal year in DOE awards must have a compliance audit conducted for that year in accordance with the provisions of this Part.
B. Compliance audit.
- If a for-profit entity has one or more DOE awards with expenditures of $750,000 or more during the for-profit entity’s fiscal year, they must have a compliance audit for each of the awards with $750,000 or more in expenditures. The remaining awards do not require, individually or in the aggregate, a compliance audit.
- If a for-profit entity receives more than one award from DOE with a sum total of expenditures of $750,000 or more, but does not have any single award with expenditures of $750,000 or more; the entity must determine whether any or all of the awards have common compliance requirements (i.e., are considered a cluster of awards) and determine the total expenditures of the awards with common compliance requirements. A compliance audit is required for the largest cluster of awards (if multiple clusters of awards exist) or the largest award not in a cluster of awards, whichever corresponding expenditure total is greater. The remaining awards do not require, individually or in the aggregate, a compliance audit;
- If a for-profit entity receives one or more awards from DOE with a sum total of expenditures less than $750,000, no compliance audit is required;
- If the for-profit entity is a sub-recipient,2 CFR 200.501(h) requires that the pass-through entity establish appropriate monitoring and controls to ensure the sub-recipient complies with award requirements. These compliance audits must be conducted in accordance with 2 CFR 200.514 Scope of audit