2022 Compliance Supplement: Fundamental Changes and Updates Impacting Single Audits

The COVID-19 pandemic has led to a tremendous increase in federal financial assistance managed by various new federal programs. In response to the pandemic’s impact, more funding has been allocated to existing programs to aid local governments, companies, schools, and organizations.

Many organizations receiving these funds are subject to the Single Audit standards for the first time, while many others that previously underwent Single Audits are now receiving extra COVID-19-related funding. Leaders or managers should be aware that the organizations that have received and expended federal grant funds of $750,000 or more in the fiscal year, whether obtained directly from a federal agency, a local government, or another charity, are subject to a Single Audit.

On May 11, 2022, the Office of Management and Budget released the 2022 Compliance Supplement. The 2022 Supplement defines the compliance requirements for auditors to consider when performing single audits under the OMB’s Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). It will be utilized as the primary audit guide for single audits for entities with fiscal years starting on or after July 1, 2021. It can also be a valuable resource for non-profit and for-profit organizations that receive federal funding because it provides information on each compliance requirement and insight into the program-specific requirements that federal agencies are most interested in auditing for compliance.

Every year, OMB updates the Compliance Supplement to reflect new and discontinued federal programs and modifications to existing programs sought by other federal agencies. Therefore, organizations that have received grants or other aid forms may now be subject to new and additional reporting requirements.

Watch our video below or read the article underneath to understand more!

Fundamental 2022 Compliance Supplement Changes and Updates

New Programs (https://www.rubinbrown.com/article/9433/)

Consistent with the 2021 Compliance Supplement and 2021 Compliance Supplement Addendums, several programs are still designated as “higher risk” in the 2022 Compliance Supplement in the respective Part sections and Appendix IV. A “higher risk” designation will often result in a Type A program being audited as a major program. However, this is not an absolute. Several significant programs excluded from the 2021 Compliance Supplement are included in the 2022 Compliance Supplement as follows:

       14.888 – Lead-Based Paint Capital Fund Program and Housing-Related Hazards Capital Fund

       21.023 – Emergency Rental Assistance (ERA)

       21.026 – Homeowner Assistance Fund

       21.029 – Coronavirus Capital Projects Fund

       32.009 – Emergency Connectivity Fund

       59.075 – Shuttered Venue Operators Grant (SVOG)

       93.671 – Family Violence Prevention and Services/Domestic Violence Shelter and Supportive Services

Higher Risk Programs (https://www.cbiz.com/key-changes-and-updates)

Following is a complete list of programs with COVID-19 funding that have been identified as “higher risk” for audits subject to the 2022 Compliance Supplement.

* Programs created by one of the COVID-19 Acts and thus considered 100% COVID-19 funding.

** Existing programs that received additional funding from one or more of the COVID-19 Acts.

Agency                       Assistance Listing Number               Title

Education*                  84.425                                               Education Stabilization Fund

FCC*                            32.009                                               Emergency Connectivity Fund Program

HHS*                           93.461                                               Testing for the Uninsured

HHS*                           93.498                                                Provider Relief Fund

HHS**                         93.778/93.777/93.775                    Medicaid Cluster

Transportation**        20.106                                               Airport Improvement Program

Transportation**        20.500/20.507/20.525/20.526     Federal Transit Cluster

Transportation**        20.315                                               National Railroad Passenger Corporation

Treasury*                    21.023                                               Emergency Rental Assistance

Treasury*                    21.027                                              Coronavirus State and Local Fiscal


A “higher risk” designation often results in a program or other cluster being audited. However, an auditor is not precluded from determining that a higher risk program or other cluster qualifies as low risk. Your tax and audit advisor can help you determine if you qualify.

Key Changes to Significant Programs


Part 2, Matrix of Compliance Requirements. 

Applicable requirements for several programs have been modified this year, and those changes are highlighted in yellow in the actual section. The six-requirement mandate and its related rules and exceptions will continue for 2022. Additionally, new programs previously added in Addendums 1 and 2 to the 2021 Supplement have been identified with one and two asterisks, respectively.

Education Stabilization Fund (ESF).

This fund has once again been identified as a higher-risk program. Regulatory changes, as well as other updates, have been made throughout this section, which includes:

Coronavirus State and Local Fiscal Recovery Funds (CSLFRF)

This program is identified as a higher-risk program and resulted in several small entities needing a single audit for the first time. To help with the administrative cost, for specific recipients, a compliance examination was created for this program as an  alternative option to a full Single Audit or program-specific audit. This alternative is only available to certain eligible participants, so be sure to work with your dedicated auditor to identify the most suitable compliance option for your organization.

Provider Relief Fund (PRF)

The program also continues to be identified as a higher-risk program, which provides relief funds to eligible providers of healthcare services and support for healthcare-related expenses or lost revenues related to Covid-19. It also adds information and requirements for funding provided to this program from the American Rescue Plan and removes the Special Tests and Provisions audit requirement that was in the 2021 Supplement.

Part 5, Student Financial Assistance Cluster

This program has several changes, clarifications and updates for 2022 to reflect regulatory changes and other updates. These changes relate primarily to various Special Tests and Provisions, such as disbursements to or on behalf of students, return of Title IV funds, enrollment reporting, program eligibility, and distance education.


How can we help

We’re here to assist you as you prepare for your single audit and handle the complexity of your federal financing. HWA Alliance of CPA Firms Inc. is a leader in providing guidance and detailed attention in the preparation of Single Audits. Whether you’re preparing your first Single Audit or have had them for years, our experts can assist you in managing the Uniform Guidance standards and compliance requirements, building internal controls, and acquiring the essential information to make your Single Audit proceed smoothly.  Our professionals have worked with NPOs, higher education institutions, and State and Local Government as grant applicants and recipients. We ensure accurate financial reporting and compliance. Your audit will be conducted thoroughly and on schedule, and our experts will share insights with you throughout the process so that you understand the details and expectations of a Single Audit.

Don’t hesitate to reach out—experience audit success with us.