Sneak Preview: Auditor Panel Discusses Extensions, FFATA Reporting Under Addendum
(The following was excerpted from a recent Thompson Grants 360 article.) A panel of auditors, during a recent webinar hosted by the American Institute of Certified Public Accountants (AICPA), provided details for auditors and their auditees on guidance in the Office of Management and Budget’s (OMB) addendum to the 2020 OMB Compliance Supplement, which allows for a three-month extension for submitting certain fiscal year-end audits and a requirement for reporting under the Federal Funding Accountability and Transparency Act (FFATA).
The addendum, which was issued in December 2020, explains how auditors should test major programs under programs that provided awards with funding made available in response to the COVID-19 pandemic. It also includes a few other program updates since the August 2020 release of the Compliance Supplement.
OMB states in the addendum that in light of the late issuance of audit guidance for the COVID-19 programs contained in the addendum, awarding agencies, in their capacity as cognizant or oversight agencies for audit, must allow recipients and subrecipients that received COVID-19 funding with original single audit due dates from Oct. 1, 2020, through June 30, 2021, an extension for up to three months beyond the normal due date to submit their single audit reporting package. Therefore, for an eligible recipient whose federal fiscal year ended June 30, 2020, and whose normal nine-month reporting due date would be March 31, 2021, the deadline for the submission is now extended to June 30, 2021.
During the AICPA webinar, Tom Sneeringer, a partner at RSM L.L.P., explained that the extension applies only to eligible clients that received funding under the COVID-related programs listed in the addendum, adding that the extension will not require individual recipients and subrecipients to seek approval for the extension by their cognizant or oversight agency for audit. However, recipients and subrecipients should maintain documentation of the reason for the delayed filing, and auditors also should document the extension in their own work files. Still, Sneeringer noted that OMB strongly encourages auditors and their auditees to complete and submit their single audit reporting packages to meet their normal submission timeline “due to the amount of money and the oversight that is involved here.”
Sneeringer also reminded auditors that six-month audit submission extensions provided in previous OMB memos (e.g., OMB M-20-17, M-20-26) have now expired, and that the extension addressed in the addendum is the only remaining audit extension in effect. He further explained that the Federal Audit Clearinghouse will not acknowledge that an entity was eligible to receive an extension, so it will be up to auditors and federal agencies to determine whether the audit package was submitted on time, and whether the extension applies when determining low-risk auditee status in the subsequent year (§200.520(a)).
(The full version of this story has now been made available to all for a limited time here.)
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