OMB Updates 2021 Compliance Supplement To Include Corrections

Have you ever had the occasion to read a mystery novel and come down to the last critical page to find out “whodunnit,” only to find that the page is missing?

A somewhat similar occurrence happened when the Office of Management and Budget (OMB) released the 2021 Compliance Supplement on Aug. 13, although in this case, it was the first page ― of Part 8, Appendix IV. For those who previously read this section on “higher-risk” programs, and noted that the flow did not make complete sense, OMB has now inserted this page and has posted a corrected version, which we provide here.

Specifically, the page, now included at 8-IV-1, discusses the provision on higher-risk programs in the uniform guidance at §200.519(c)(2), the various COVID-19 legislative relief packages, including the American Rescue Plan (ARP) Act (Pub. L. 117-2), and notes that due to the additional risk associated with certain COVID-19 funding, additional programs along with the Medicaid Cluster have been added to the “higher risk” list for single audits subject to the 2021 Compliance Supplement.

The page adds that OMB is currently working to identify all new ARP programs and will be posting a complete list with Assistance Listing numbers at the CFO.gov website. This list will also “identify which new programs will have a program section made available in a subsequent follow‐up issuance” to the compliance supplement (although OMB has since informed that there likely will be two addenda to the supplement). There will be no new other clusters formed by ARP Assistance Listing numbers, nor will any ARP Assistance Listing numbers be added to existing other clusters.

In other corrections to the supplement, OMB has included in Part 4 a note for each of the eight programs and clusters listed in Appendix IV as “higher risk” programs. The note states the following: This program is considered a “higher risk” program for 2021, pursuant to 2 C.F.R. § 200.519(c)(2). Refer to the “Programs with Higher Risk Designation” section of Part 8, Appendix IV, Internal Reference Tables, for a discussion of the impact of the “higher risk” designation on the major program determination process.”

Also, OMB updated material in Part 4 for the Department of Health and Human Services’ Testing for the Uninsured program (Assistance Listing No. 93.461) and information in Part 5-3, Student Financial Assistance Programs. Auditors testing these programs should ensure that they review the latest guidance within the updated supplement.

Lastly, we want to thank the National Association of State Auditors, Comptrollers and Treasurers for making us aware of this information. Glad we could pass it on!

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