Does CARES Act funding affect your next Single Audit?
Single audits are required if an organization expends (not receives) $750,000 in either Federal or State Funds, not combined, in your Fiscal or Calendar Reporting Period. As an EIDL or PPP loan recipient you may be wondering how or if these federal funds contribute to or impact your next Single Audit:
Economic Injury Disaster Loans (EIDL) issued by the Small Business Administration are reportable on the Schedule of Expenditures of Federal Awards (SEFA) and are reported for the entire amount received and the value of the loan will stay on the SEFA until it is paid off or forgiven. While these funds alone are unlikely to trigger a single audit, a non-profit might reach the $750,000 as a result of these funds plus other funds expended during the year.
As the Paycheck Protection Plan Funds originate from commercial banks they are not subject to single audit requirements. That being said, the funds may be subject to a compliance audit performed by the bank itself.
For both Federal and State funds, it is best practice to check with the grantor if the funds received should be presented on the (SEFA) or Schedule of Expenditures of State Awards (SESA).
Typically reporting the Single Audit to the Federal Audit Clearinghouse must occur at the earlier of 1) 30 days after the audit is completed, or 2) 9 months after year-end. Currently, under the CARES Act, there is an automatic 6-month extension.