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Draft 2025 OMB Compliance Supplement Now Available for Planning

The OMB 2025 Draft Compliance Supplement is Now Available

The Executive Office of the President, Office of Management and Budget (OMB) has released the Single Audit Compliance Supplement for 2025. It can be viewed/downloaded here from the AICPA website with a free account. It is important to note that this document is a draft, so some of the information discussed may be altered and/or removed when the final draft is released. We will update this accordingly if some of the important changes we write about encounter revisions later on. Supplement Parts 1 and 2 have no significant or material deviation from prior years’ regulations.

Here's How Your Single Audits May Be Affected:

Supplement Part 3 - Compliance Requirements

A major change in the literature is the differentiation between requirements for grants/awards that are subject and those that aren’t subject to the 2024 revisions, which went into effect October 1, 2024. This adds complexity for both the auditor and the grantee, as they will need to closely track their organization’s awards to properly identify which awards are subject to which requirements. 

  • Part 3.1 regards awards before October 1, 2024
  • Part 3.2 regards awards on/after October 1, 2024
Notable changes have been made to both parts’ Sections B (Allowable Costs/Cost Principles), F (Equipment and Real Property Management), I (Procurement and Suspension and Debarment), and L (Reporting). We encourage our clients and other auditors to review the new regulations closely, and to reach out to us with any questions.

Supplement Part 4 - Agency Program Requirements

Various federal programs and clusters received additions, revisions, and removals. We’ve noted some of the big ones below.

Additions:

  • 10.646 – Summer Electronic Benefit Transfer Program for Children
  • 93.472 – Title IV-E Prevention Program
Revisions:
  • Section 14 – Programs under the Department of Housing and Urban Development (HUD)
  • Section 84 – Programs under the Department of Education (ED)
  • Section 93 – Programs under the Department of Health and Human Services (HHS)
Removals:
  • COVID-19 Pandemic programs have begun being phased out

Supplement Part 5 - Cluster of Programs

The Research and Development cluster now explicitly includes grants from the National Institute of Health (NIH) and the National Science Foundation (NSF). Verbiage was updated to reflect that found on SAM.gov.

Supplement Parts 6 and 7 - Internal Controls and Guidance For Auditing Programs Not Included

Verbiage in these parts was also updated, notably “non-federal entity” is now referred by “recipient and subrecipient” to distinguish more between the flow of federal funds through organizations.

Supplement Appendices

Appendices have been updated to reflect changes made to agency audit guidelines and contacts, and risk designations. Additionally, the audit threshold has been increased from $750,000 to $1,000,000 in federal awards for fiscal years beginning on or after October 1, 2024. This means that smaller organizations may find they are no longer required to have a Single Audit, reducing their audit expenses.