A Single Audit is a comprehensive financial and compliance audit required for non-federal entities, such as state and local governments, nonprofits, universities, and tribal organizations, that expend a certain amount of federal funds in a fiscal year. It was established under the Single Audit Act of 1984, later amended in 1996, and is governed by the Uniform Guidance codified in 2 CFR Part 200, Subpart F.
In April 2024, the Office of Management and Budget (OMB) issued updated guidance for federal financial assistance, including revisions to the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Effective for fiscal years beginning on or after October 1, 2024, the OMB increased the Single Audit threshold from $750,000 to $1,000,000 in federal expenditures. The Type A program threshold has also increased from $750,000 to $1 million for non-federal entities with annual expenditures of $34 million or less.
Entities spending less than $1 million in federal funds annually are no longer required to undergo a Single Audit. This revision is expected to reduce the audit and reporting burden and enable federal audit resources to focus on larger awards with potentially higher compliance risks.
The OMB made several additional updates alongside the threshold change:
Three practices are critical as your organization adapts to the updated requirements.
First, sustain compliance awareness. Organizations must continue documenting expenditures, tracking funding sources, and maintaining proper reporting to meet internal and external accountability standards.
Second, monitor annual expenditures closely. For entities whose federal funding fluctuates year to year, accurate tracking of expenditures throughout the fiscal year helps determine early whether a Single Audit will be required.
Third, strengthen internal controls. Robust internal control systems and consistent documentation safeguard compliance readiness, support timely decision-making, and strengthen the integrity of financial reporting—regardless of audit thresholds.
As OMB guidance and regulatory expectations continue to evolve, our team remains committed to helping clients adapt with confidence. Through financial statement audits, internal control assessments, and compliance consulting, we help nonprofits and other non-federal entities maintain transparency, accountability, and operational efficiency in an ever-changing landscape. If you have questions about how the Single Audit threshold increase may affect your organization, please reach out to us using the form below.
